If you win the lottery, which is better one lump sum payment or installments?

Question

If you win the lottery, which is better one lump sum payment or installments?

Answer 1

I believe that you actually get more money if you do it in installments. However, I know I'd want to have the money all at once.

Answer 2

That depends on how much you win.  All I've won is a couple of bucks so I splurge and take my winnings all at once.

Answer 3

i would take the lump some. put much in cd to and live off the interest.  

Answer 4

I would take installments. I would spend it on beer and nasty women. I would then waste the rest of it.

Answer 5

you get more if you get the installments. they take more taxes out if you get the lump sum.

Answer 6

If you do the math, taking half and putting it in a CD that pays interest annually will yield higher results than taking the money up front, especially now.

Answer 7

If you choose the cash option you do get a lower amount than if you take the installments. I personally would choose cash, I wouldn't want anybody holding my money for 26 years  

Answer 8

I always ask for the payments when I buy a ticket for two reasons.  First -- I don't trust myself.  I'd rather take $26million in 26 annual $1mil payments and know each year that I have another million coming next year.  Otherwise, I may blow it all at once.  Second, I plan to live for another 26 years and I figure that I can make ends meet well enough with a million a year -- I'm not too concerned with investing it and doubling it or anything -- one million is enough for me.

However, if you have a good financial planner that you trust, you may make more money investing the lump sum.  The lump sum is less because it is the amount that the lotto determines they would need to invest in order to make your payments over the next 26 years.  You could invest that money yourself and potentially make more.  However, you could also invest that money yourself and lose a substantial portion of it.  I figure that the state probably won't miss the lotto payments, but I may misinvest the money.  So again, I stick with the payments personally.

Answer 9

One time.

Who knows what will happen the next 26 years.  Heck, I don't even know what will happen tomorow!

May be in the next 10 years there will be a World War 3.  May be the Earth will stop rotating in 5 years.  I want to see all of what I could have before then.

Answer 10

depends on yor health and age.You might not be able too leave it in a will (that's what I heard) and it goes back to the state or states so get a financial adviser an make sure before doing anything. (if it were me I would take a lump sum and let my financial adviser guide me.)

Answer 11

Usually, the lump sum option is best. As long as you invest it in a reasonably good way, the eventual yield over time will be much better than what is paid out in yearly installments. (Even if you take it and buy an annuity that pays for the same period, chances are your annual payments will be somewhat higher than the lottery's. The lottery has no incentive to shop around to find you the best rate of return - you do.)