Lottery payout- which would you take?

Lottery! - which type of payout would you choose?
United States
January 5, 2007 6:42am CST
Today there will be a drawing in my state for a one million dollar lottery. The winner will be given a choice...$50,000.00 a year for life, or a one time payout of $800,000.00.....which would you choose and why?
3 people like this
5 responses
@shorva (923)
• Philippines
5 Jan 07
one time payout.in the future the $50,000 wldnt be as much as it is now.
3 people like this
• United States
5 Jan 07
very good reasoning...thank you
• United States
5 Jan 07
I think I'd take the $50,000.00 a year for life. after the government takes it's share (for taxes) that would be around $25,000.00 a year. The lump sum would be around $400,000.00 after the government got it's share. Hummmmm, see if they stop paying right away, if something happens to you. if so, I'd take the lump sum, if they still pay up to a pretty good amount, I'd still take the yearly. that way your family would have a little extra to fall back on.
• United States
5 Jan 07
good reasoning!..thanks for the response
@reinydawn (11649)
• United States
5 Jan 07
I guess it would depend on your age. $50k/yr for life would be $800,000 in 16 years. If you're younger than say 50, take the annual, invest it and keep working for a couple more years and you'd be set. There is the Time Value of Money to consider - inflation will mean that $50k in 16 years will only buy you what $30k will buy you today, so you're not going to make out in that respect. But if you're young, chances are you'll live longer than 16 years and you'll end up with a lot more than $800,000.
• United States
6 Jan 07
Very good reasoning..yes, your age would have a lot to do with it...thank you
@Lillith (775)
• United States
5 Jan 07
I would have to take the one time payout of $800,000.00. There is no guarantee that I would be around to enjoy the full amount if I took the yearly payout and I would want to be able to enjoy all of that money, as well as do some investing, and making sure my family is taken care of. I know that $50,000 a year would be less taxes and probably end up being more in total. But I have trust issues. LOL
• United States
5 Jan 07
so do i...i'd rather get it all now and be able to accomplish everything all at once, and take a rest from there...lol!...thank you
• United States
5 Jan 07
I would choose the $50,000.00 a year for life if I ever won a lottery like that. That way a person would know that they would have a steady extra income coming in. To receive the one time payout would make it too easy to overspend and use all the money too fast and leave almost nothing for later in life if they didn't invest the money to begin with. Would you choose the annual payments or would you choose the lump sum payment? If you bought a ticket or tickets I wish you the best in winning ;)
1 person likes this
• United States
5 Jan 07
Unfortunately, this was a scratcher drawing that you could not just buy a ticket now...but I think I would take the lump sum, I'd be able to accomplish everything I wanted to with the extra money, put what I need back, and be able to go from there. If I took the yearly, then my dream project would take too long to be realized. Thanks for the luck anyway!