ShokWaveRider
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
She should have taken the annual payment, she was only 47 years old.
Can you spot the money mistake this local lottery winner made?
Agreed. They make the "after tax" amount sound like spendable money, when in reality more taxes are usually required at the first filing.The "after tax" amount is after the required withholding, it's not the total tax due. Tax on $5.7 million would likely be$280k State of NC and nearly $2 million Fed taxes.
Going on the record with her full name and a photo, obviously.
Yes, even back before a lump sum was an option, many sold the annuity ASAP for a pot of cash so they really did feel like a "millionaire"............
I can understand the emotional appeal of the lump sum, but monetarily it is a far poorer value in this case.
As with most lottery wins where there is a choice.
For 4.1 net after taxes, vs. a 20 year annuity? Yeah I'd have done the same thing. It's a pretty sweet deal either way, and if she's not a twit and invests it as any of us would I'm sure she'll be fine.
Well, as Taxman59 said above it is less than $3.5 million after taxes. The $4.1M number simply represents withholdings, not actual tax due, and the withheld amount is never sufficient to cover the tax on these things.
It appears to be a lifetime annuity with a 20-year minimum.
So yea, the annuity is a really sweet deal.
Going on the record with her full name and a photo, obviously.
+1, beat me to it. Better to stay anonymous if possible (some state lotteries have laws against that).
Better to stay anonymous if possible (some state lotteries have laws against that).
She's left with ~$3.3 million after paying applicable federal & state taxes.
I had forgotten the annuity is guaranteed 20 years minimum.
I'd also take the $300+ million lottery wins like Powerball/MM as a lump sum, but here at least the annuity was clearly the more remunerative choice.
Best I can make of the lottery curse... would be to imagine any one of us having a spotlight shone onto our FIRE finances, for all our family, friends and the general public to see. Now imagine if it was all just given to you... and something you didn't earn...