The Mega Millions lotto had no winner this last drawing, so it's rolled over again, making the jackpot of $365 million one of the largest ever.
The amount is staggering, isn't it? Over a third of a billion dollars. It would be nice (an understatement) to win it, but even nicer (read:greedy) to be the sole winner.
The $365 million is for an annuity which would be paid out over 26 years. When you purchase a ticket, you have the option of the annuity or taking a lump sum, which for this drawing would be $255.1 million. After federal taxes, that figure would be $165.815 million. (No state tax in Texas!) I've always thought I would opt for this method of payout, considering what my age would be after 26 years. I have to face the fact that I most likely wouldn't live to see the last yearly payments. (or wouldn't remember my name or that I had ever won the lottery) That's not the only depressing fact to take into consideration - the interest on certificates of deposits is pathetically low. They vary all the time and from bank-to-bank, but some yearly CDs pay less than 1% a year and 5-yr CDs anywhere from 1.7- 2%.
Let's say you blew through 10 million right off the bat and allotted another million a year to spend until your jumbo 5-yr CDs matured. (of course, you could make a dab of interest on unspent money, but let's disregard that for the sake of simplicity.) $150 million @ 2% would, with simple interest (not figuring compound rates) get you $3 million per year. (15 million+ over the five yr. period) Of course, Uncle Sam would want his 35%*, so the yearly net would be $1.95 million. I think most people could live on that.(You could also make some interest on the earned interest if you reinvested it.) You could then leave the huge sum of money - the 150 million- to your family. (Although in some cases, you *might* want to lie to them and tell them you're leaving most of it to charity. Otherwise they might want the will to be read a little early, if you get my drift. It's happened.)
On the other hand, if you did opt for the annuity, the income is much better. Before taxes, the yearly payout would be $13.692+ million a year with a net of $8.9 million. That would give you a monthly take-home income of a little more than $741, 666, a weekly income of $171, 153 and change - which works out to $24,383.56 a day.
Or, you could look at it this way: $1015.98 an hour. You could afford to pay someone minimum wage (Federal min. wage is $7.25) - along with some basic benefits - just to screen your calls from all the distant kinfolk and scam artists who would want some of your new-found riches.
That leaves you with a thousand bucks an hour for 26 years. That's $1000 per hour, every hour of every day of every week of every month for 26 years. Rain or shine, asleep or awake, it's going into your bank account.
Not bad wages, huh?
*I've read that 35% federal tax rate might soon go up to 39% if the current administration has its way. It's not just the President and the Democrats in Congress - a growing percentage of the population is of the mind that the rich don't pay enough taxes. Winning the lottery wouldn't just change your life, it might also change your political affiliation. -wink-
Edit: I don't mean to insult anyone w/ the political reference. I expect you...or I...would keep our same core political beliefs as we had before winning the lottery, BUT I'd think...would hope...we would be more "liberal" in regards to charity and more "conservative" fiscally.
UPDATE: The announced jackpot is 363 million. I guess the 365 number was the estimate. Usually, though, when a jackpot is this large, the number goes up because the prize is tied into a percentage of tickets sold. So, my calculations are incorrect. They were, anyway. I don't know what caused me to make the mistakes, but I did. (I used my computer calculator, but I guess you need to be semi-smart to use it. That lets me out.) So sue me. Wait until I win the lottery, though, because you damn sure wouldn't get anything now.
I read an article this morning which mentioned "lottery fever" - when people get excited by the huge jackpot and buy more tickets, often more than they can afford. It also touted some "expert" who said a lottery player should always pick their own numbers, not allow the machine to choose them. That doesn't make any sense, because one number is just as good as any other. (the winning number notwithstanding! -grin-) I always get a "quick pick" because my old set of numbers never did much good. I also had a fear that if I ever did quit playing them or change to another, they would come up. That could happen anyway, I suppose.
I also bought but one ticket. Buying two tickets doesn't do much to increase your odds of winning, not by my thinking. If the odds are one in ten million, then an extra ticket would make it two in ten million. I suppose you've doubled your chances, but....
The amount is staggering, isn't it? Over a third of a billion dollars. It would be nice (an understatement) to win it, but even nicer (read:greedy) to be the sole winner.
The $365 million is for an annuity which would be paid out over 26 years. When you purchase a ticket, you have the option of the annuity or taking a lump sum, which for this drawing would be $255.1 million. After federal taxes, that figure would be $165.815 million. (No state tax in Texas!) I've always thought I would opt for this method of payout, considering what my age would be after 26 years. I have to face the fact that I most likely wouldn't live to see the last yearly payments. (or wouldn't remember my name or that I had ever won the lottery) That's not the only depressing fact to take into consideration - the interest on certificates of deposits is pathetically low. They vary all the time and from bank-to-bank, but some yearly CDs pay less than 1% a year and 5-yr CDs anywhere from 1.7- 2%.
Let's say you blew through 10 million right off the bat and allotted another million a year to spend until your jumbo 5-yr CDs matured. (of course, you could make a dab of interest on unspent money, but let's disregard that for the sake of simplicity.) $150 million @ 2% would, with simple interest (not figuring compound rates) get you $3 million per year. (15 million+ over the five yr. period) Of course, Uncle Sam would want his 35%*, so the yearly net would be $1.95 million. I think most people could live on that.(You could also make some interest on the earned interest if you reinvested it.) You could then leave the huge sum of money - the 150 million- to your family. (Although in some cases, you *might* want to lie to them and tell them you're leaving most of it to charity. Otherwise they might want the will to be read a little early, if you get my drift. It's happened.)
On the other hand, if you did opt for the annuity, the income is much better. Before taxes, the yearly payout would be $13.692+ million a year with a net of $8.9 million. That would give you a monthly take-home income of a little more than $741, 666, a weekly income of $171, 153 and change - which works out to $24,383.56 a day.
Or, you could look at it this way: $1015.98 an hour. You could afford to pay someone minimum wage (Federal min. wage is $7.25) - along with some basic benefits - just to screen your calls from all the distant kinfolk and scam artists who would want some of your new-found riches.
That leaves you with a thousand bucks an hour for 26 years. That's $1000 per hour, every hour of every day of every week of every month for 26 years. Rain or shine, asleep or awake, it's going into your bank account.
Not bad wages, huh?
*I've read that 35% federal tax rate might soon go up to 39% if the current administration has its way. It's not just the President and the Democrats in Congress - a growing percentage of the population is of the mind that the rich don't pay enough taxes. Winning the lottery wouldn't just change your life, it might also change your political affiliation. -wink-
Edit: I don't mean to insult anyone w/ the political reference. I expect you...or I...would keep our same core political beliefs as we had before winning the lottery, BUT I'd think...would hope...we would be more "liberal" in regards to charity and more "conservative" fiscally.
UPDATE: The announced jackpot is 363 million. I guess the 365 number was the estimate. Usually, though, when a jackpot is this large, the number goes up because the prize is tied into a percentage of tickets sold. So, my calculations are incorrect. They were, anyway. I don't know what caused me to make the mistakes, but I did. (I used my computer calculator, but I guess you need to be semi-smart to use it. That lets me out.) So sue me. Wait until I win the lottery, though, because you damn sure wouldn't get anything now.
I read an article this morning which mentioned "lottery fever" - when people get excited by the huge jackpot and buy more tickets, often more than they can afford. It also touted some "expert" who said a lottery player should always pick their own numbers, not allow the machine to choose them. That doesn't make any sense, because one number is just as good as any other. (the winning number notwithstanding! -grin-) I always get a "quick pick" because my old set of numbers never did much good. I also had a fear that if I ever did quit playing them or change to another, they would come up. That could happen anyway, I suppose.
I also bought but one ticket. Buying two tickets doesn't do much to increase your odds of winning, not by my thinking. If the odds are one in ten million, then an extra ticket would make it two in ten million. I suppose you've doubled your chances, but....
