Would it be best to take a lump sum payment or take it over a long term for a lotto player that is in his 30s?
2007-01-09 14:19:43 · 9 answers · asked by lightning_thunderwolf 1 in Business & Finance ➔ Taxes ➔ United States
When you take the lump sum it is taxed much more but you get it all up front. Depends on what you plan on doing with the money. GOOD LUCK!
2007-01-09 14:29:39 · answer #1 · answered by Smart1 3 · 0⤊ 0⤋
If you take the cash, you get the amount that if invested for 20 years would equal the amount of the guaranteedd payoff. So the answer would be can you invest the money better than the government?
Or can you handle having all the money at one time and not blow it all? Most winners end up broke because they can't handle the money.
Or what tax advantage do you have for taking it all at once or spreading it out.
Your call. LOL.
2007-01-09 14:51:18 · answer #2 · answered by towanda 7 · 2⤊ 0⤋
take the lump sum cash. you'll lose about 40% in taxes, but then you have control of the money and can (after a wee celebration) invest the cash in real estate, stocks, or an annuity of your choice. the annuity will provide you with a lifetime, guaranteed income.
good luck!
2007-01-09 18:36:27 · answer #3 · answered by derekeb_yft 2 · 2⤊ 0⤋
It depends on what you will do with the money when you win.
Considering a high % of lottery winners end up broke you might be better taking the annuity.
But if you do a good job with a budget and hire someone to limit your spending the cash option might be best.
I always choose cash.
Michael
2007-01-09 14:24:57 · answer #4 · answered by PrayerRequestBox 3 · 2⤊ 0⤋
Take the cash. Some annunities become void if you croak. Cash is king.
2007-01-09 15:05:23 · answer #5 · answered by thebushman 4 · 1⤊ 1⤋
Have you ever heard the saying "Don't count your eggs before they've hatched?" Worry about what to do when you actually win the prize.
2007-01-09 14:24:33 · answer #6 · answered by Tora 2 · 2⤊ 0⤋
Usually yonger people take annuity.Old people take the cash.
2007-01-09 14:24:55 · answer #7 · answered by xphxpd 3 · 2⤊ 1⤋
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2015-02-05 20:18:55 · answer #8 · answered by Brina 1 · 0⤊ 0⤋
wish me luck
will do
you can decide what after you win
2007-01-09 14:23:43 · answer #9 · answered by cork 7 · 0⤊ 0⤋