Lottery player/winner advice ?

Reply #39

visiondude — Tue, 10 Sep 2002 15:45:29 GMT

todd , i am laughing right now. thomas covenant taught me how to do it (blame him). i found the one at the top. thomas sent me the one on the bottom just a little bit ago. i told him exactly that, that it will creep out some people (lol). no i am not an optometrist (lol). gives new meaning to the i am keeping my EYE on you joke.vision - i am looking at you - dude

Reply #38

Todd — Tue, 10 Sep 2002 15:32:06 GMT

All those eyes are giving m

Reply #37

visiondude — Tue, 10 Sep 2002 15:01:29 GMT

i think that if they can't pay all taxes due up front, they forfeit the remaining amount to the boogeyman (IRS).....................visiondude

Reply #36

CASH Only — Tue, 10 Sep 2002 14:08:07 GMT

I suppose it's possible, depending on the heirs' assets, whether the next annuity check comes in the 10 months after the winner dies, the amount(s) and number of future checks. Todd knows about this stuff.

Reply #35

rundown99 — Tue, 10 Sep 2002 13:49:33 GMT

Does that mean that if the heirs don't pay it up front, they may never see the money

Reply #34

CASH Only — Tue, 10 Sep 2002 13:04:26 GMT

AFAIK, 4777, the lottery (once the annuity is bought) does not handle the money. The lottery DOES NOT deduct from the future payments. The IRS can take away the heirs' assets, and, if need be, withhold any portion of future installments, and collect interest, on the owed estate tax. Don't quote me 100% on this however.

Reply #33

rundown99 — Tue, 10 Sep 2002 12:45:52 GMT

CASH OnlyI just have a quick question. What if the heirs to the inheritance can't afford to pay the estate tax up front? Does the lottery hold the money until they can pay or does the lottery take the tax amount of the entire annual check, year after year, until the tax is paid off, and then give them the remaining checks

Reply #32

CASH Only — Tue, 10 Sep 2002 11:10:19 GMT

lotteryinfopls: What if any of the 9/11 victims had recently won the lottery, and they chose annuity, and their heirs had to pay inheritance tax within 10 months of the winners' death, and the heirs did not have the money to pay the inheritance tax for the remainder of the annuity payments? The $28 million winner in Illinois probably went against expert financial advice. Be thankful almost all US lottery jackpot games give you a choice. When the 1990s began, NOBODY was allowed to choose. Choo... [ More ]

Reply #31

Guest — Tue, 10 Sep 2002 10:22:13 GMT

Don't either of you ever post to me again if you are not going to discuss the topic, I got e-mail from the monitor for your reference to 9/11. That issue had nothing to do with this topic and should not have been brought up so if you cannot reply about the topic to me, don't reply to me at all, Understood.

Reply #30

visiondude — Tue, 10 Sep 2002 00:48:27 GMT

lottoinfopls, cash only was making a reference to 9/11 only to point out that we are not guaranteed tomorrow. we could die, we never know when. with annuity it takes 25 years (or so) to get your money. lump sum gives it to you NOW.there are wealthy men working in tall buildings. howard lutnick is the c.f.o of cantor fitzgerald. he was late to work that day (9/11) but he lost hundreds of his employee's at i think around the 84th floor of the world trade center. howard lutnick is worth mor... [ More ]

Reply #29

Guest — Mon, 09 Sep 2002 22:22:32 GMT

What the 9/11 got do with this discussion? Any REAL MONEY $50 MILLION PLUS MEN AREN'T WORKING IN 110 STORY BLDGS. Taking the lump sum is your opinion and decision to take the lump sum should be taken into advisement. $165million man was advised to so. A winner of $28million in Illinois took the annuity and places the payment in the partnership and she was probably advised to do. I would do the same thing, difference of opinion you take lump I am taking the annuity I want all the money not... [ More ]

Reply #28

visiondude — Mon, 09 Sep 2002 20:25:08 GMT

trusts become two things: (1) trusts are a firewall' between you and the people that want to seperate you from your money. multiple trusts, multiple firewalls. nothing EVER in your name. and you can change trusts many times making it harder for people to get at you. the more you win, the more someone is interested in your cash -o - la.(2) one of the most important things about lump sums are the transfer of estate (tax) issues. your heirs get hammered tax wise on an annuity. some of... [ More ]

Reply #27

CASH Only — Mon, 09 Sep 2002 19:50:23 GMT

lotteryinfopls: The $165 million NJ winner took the LUMP SUM !! A lottery winner should ALWAYS choose lump sum if they win (regardless of age- weren't most of the 9/11 victims younger than 45 ?) If you ever win the lottery (assuming the choice is made after you win) I bet you'll realize the lump sum is a better deal.

Reply #26

Guest — Mon, 09 Sep 2002 19:44:51 GMT

See edited reply above. So isn't this a capitalist society. After all the winner only paid A FEW BUCK FOR THEIR MILLIONS. No matter what you do somebody always going to make money off it. THAT'S WHAT CAPITALISM IS ALL ABOUT

Reply #25

CASH Only — Mon, 09 Sep 2002 19:31:26 GMT

lotteryinfopls: The provider if the annuity that is sold to the lottery for the winner makes money off of YOUR winnings...NOT YOU. Why don't you ask Webmaster Todd about whether cash or annuity is better

Reply #24

Guest — Mon, 09 Sep 2002 19:26:54 GMT

Sorry Cash Only if YOU misunderstood these annuity FROM PRIVATE COMPANIES INVEST ONLY IN US TREASURY BONDS!!!!!! NOT IN THE ACTUAL US TREASURY. And if you win you should not claim your winnings in your name any way. Either a family trust or a family partnership or you can set up a foundation like the $165winner in NJ and every body get a check working for the foundation or the partnership. I wonder if the NJ executive claimed the annuity or took the $92 million lump sum. Give me an answer

Reply #23

CASH Only — Mon, 09 Sep 2002 18:56:14 GMT

Until about four years ago, getting financial advice after you won was less important because you had to choose when you played, if the cash/annuity choice was available. Unfortunately, NY still requires the choice be made when you play.

Reply #22

visiondude — Mon, 09 Sep 2002 18:19:39 GMT

it is interesting that it wasn't too long ago that people even started to consider getting financial advice before running down to their local lottery hdqtr's to collect their cardboard check. most past winners did just that ( i want my money NOW). a few lottery states are actually advising winners to get advice before collecting. they didn't use to do that before.people that didn't seek advice before collecting were ignorant of the implications of an annuity estate tax. it seems that until... [ More ]

Reply #21

CASH Only — Mon, 09 Sep 2002 17:53:18 GMT

lotteryinfopls: Visiondude is right about taking the lump sum. So is Todd the webmaster. So is almost everyone else who has voiced their opinions on this board. BTW, which state are your from? In New York, where I live, the annuities, AFAIK, are from private companies, not the US Treasury.

Reply #20

visiondude — Mon, 09 Sep 2002 17:46:34 GMT

when i win i am going to take the lump sum. then i am going to let my son bury all the CASH in my new expansive back yard in a secret location. then i am going to instruct him to give me only $20,000 a month for the first year (of course i won't tell anyone how much i am alloting myself per-month). that way i have control over MY cash. i won't need to invest because who needs more money when you already have $20 million buried in your back yard? the idea will be to protect it so you don't l... [ More ]

Reply #19

Guest — Mon, 09 Sep 2002 17:11:38 GMT

Cash only What if you take the lump sum and put it in your own annuity and the company goes bankrupt? Having worked for the state comptroller office if that company goes bankrupt there is a whole people that are going to be feeling pain not just you any way you will have some your payment in another insurance institution any way. But if that every does start to happen you can kiss US Treasuries goodbye because those are the only annuities fund the state lottery can invest in. They invest only... [ More ]

Reply #18

CASH Only — Mon, 09 Sep 2002 16:21:29 GMT

lotteryinfopls: What if you take the annuity, and the company/corporation the annuity is from goes bankrupt

Reply #17

Guest — Mon, 09 Sep 2002 16:17:01 GMT

You given an opinion not fact, the fact is people as whole are bad money managers even with the annuity 70% of lottery winners squander their winnings just think how that is with a lump sum. An getting a lawyer and accountant is not going to save you just ask those Enron and Worldcom folks who had Arthur Anderson (premier accounting firm) doing the auditing meant that their retirement was okay. The key is YOU MUST DO THE HOMEWORK AND FIGURE OUT WHAT IS BEST FOR YOU. YOU TAKE EVERYTHING UNDER

Reply #16

CASH Only — Mon, 09 Sep 2002 15:58:45 GMT

lotteryinfopls: You've posted only three times so far, and obviously you haven't spent much time reading these messages. NEVER let the lottery assign you the annuity! You lose control, and leverage, over your money if you tell the lottery you want the annual payments. It is YOUR money after all. NOBODY should be fooled into taking the annuity, regardless of their age. Get expert financial advice, take the LUMP SUM, and then shop around for investing. THEN you can consider an annuity, and you'l... [ More ]

Reply #15

harry613 — Mon, 09 Sep 2002 15:00:13 GMT

HEY, some

Reply #14

Guest — Mon, 09 Sep 2002 14:49:34 GMT

I would probably go with the annuity over the cash sum. Use a trust or a partnership with the help of an estate lawyer. Then for the next 27 years you have a steady income. The article was trying to say that to keep a better fix on your money emotionally you need the annuity. The annuity keeps you from spending all you money. Look at some of the young people in their twenties who have won, they should taken the annuity! It your money, it just like a retirement, they don't give you lump sum... [ More ]

Reply #13

rdarmand — Sat, 07 Sep 2002 13:20:26 GMT

Gary,It's always a better investment to take the lump sum.Let's use your example, and say that you have a choicewhether to take $100 million over 25 annual payments of$2.2 million each (55% of $4 million), or $32 million ina single lump sum.The average annual return on common stocks is between10.2% and 11%; so let's assume 10.6%.If you take the annuity, and invest $2.2 million(55% of $4 million) each year for 25 years, after 25years you'll have $262 million. On the other hand, ifyou take the $32... [ More ]

Reply #12

Thomas Covenant — Sat, 07 Sep 2002 08:14:30 GMT

Even with an annuity you still get taxed on the whole thing dventually. Lets say someone gives you a $1000 annuity that matures in one year. They pay $900 for it. When you sell the annuity at the end of the year you will pay taxes on $1000. Which is the principal and the interest. This is what the lottery commision does. They buy 26 annuities, the first one matures in one year, the second one matures in 2 years. and so on. All the money is divided up to make each payment equal. When you choose t... [ More ]

Reply #11

gary — Sat, 07 Sep 2002 07:11:11 GMT

What about the fact that in a lump sum you receive after tax money where as annuity, govt invests pre tax money in annuity and taxes you on the return? Lets say you win 100 mil jacpot. If you take lumpsum, you will only get 58 million out of which they withhold 27.5% federal and applicable state taxes. In reality, a jackpot mean, you have to paay 39.6% federal taxes. So proprbably 45% taxes (assuming 5% state tax) will be paid by you. That means out of 58 mil, you will have 26 mil will be paid

Reply #10

visiondude — Sat, 07 Sep 2002 04:56:07 GMT

wishin, we didn't get away from the original intent of the article. in fact we answered it definitively. if a person thinks they might have a problem handling a large amount of money, by all means structure an annuity. but what we were pointing out is once you collect your annuity from the lottery, you have effectively lost control of your money. the only way out then is to sell the annuity to an annuity purchasing agent. you will get cash out of the sale, but the loss as a result of that sa... [ More ]

Reply #9

wishin — Sat, 07 Sep 2002 03:16:21 GMT

Can we get back to the original post and the article in which the comments were referred, please? The original post mentioned that lump sum is better than annuities doled out by the state. THAT, and several other posts, is not the issue from the article. In fact, the article stated, and I quote, again, From a financial standpoint, it's better to have it and invest it. That plainly advocates lump sum, not state annuity. The point Haisman was trying to get across was that there are people w... [ More ]

Reply #8

visiondude — Thu, 05 Sep 2002 11:47:19 GMT

there are two rules apply to the new lottery winner that will give you the ability to hold everyone at bay (including relatives and friends).1) it is not all of a sudden up to you to right every wrong around you. just because you have money it is not your responsibility to fix aunt edna's credit card woe's (unless of course you choose to). 2) there is a very small but powerful word in the english language. this word will empower you and at the same time enable you to keep your character... [ More ]

Reply #7

CASH Only — Thu, 05 Sep 2002 09:33:10 GMT

Secret4777: Your age doesn't matter. Choosing annuity payments from the lottery separates you from your money because you don't have control of your winnings after the first installment. Visiondude is right about taking the lump sum (in ALL circumstances). Your friends/relatives have no right to your winnings unless you owe them money.

Reply #6

rundown99 — Thu, 05 Sep 2002 04:09:02 GMT

I would normally suggest the cash, but if you are in your twenties, a 25 year annuity plan would certainly discourage those greedy older relatives and friends from separating the money from you because they won't wait so long to take that gift away if most of it hasn't arrived yet.

Reply #5

visiondude — Thu, 05 Sep 2002 00:33:35 GMT

thank's todd !! now if i can figure out those 3 number games i will be a better individual (lol). we are always learning aren't we? (or should be anyway)......................visiondude

Reply #4

Todd — Thu, 05 Sep 2002 00:20:56 GMT

Visiondude - you're right on the mark.

Reply #3

visiondude — Wed, 04 Sep 2002 23:22:26 GMT

with a substantial jackpot, lump sum is the way to go. you never fully trust anyone with YOUR money after that. you can have multiple attorneys and multiple financial advisors that have no financial bias with each other in order to hold each other accountable. this will allow the new winner to keep a good check in place until they can educate themselves on how to handle as much of it themselves as they can. multiple trusts are a good insurance policy. they can act as a good buffer zone... [ More ]

Reply #2

CASH Only — Wed, 04 Sep 2002 22:28:29 GMT

I'm not saying that annuities are bad. My feeling is that if a lottery player likes the idea of receiving annuity payments after they win (should it happen) they still should choose LUMP SUM, and after they receive the cash, buy the annuity after shopping around for the annuity and/or other financial vehicles.

Reply #1

wishin — Wed, 04 Sep 2002 20:39:08 GMT

I respectfully disagree with your analysis of Haisman's article. Althouh I noticed a few typographical/grammatical errors which can change the meaning of the message in his article, I don't believe Haisman is encouraging annuities. My take on the article is that some people are not able to handle the wealth; they strive for immediate gratification that the prize offers instead of planning and anticpating possible pitfalls such as health issues. Hence, the money is gone in 2-3 years. Those... [ More ]

Lottery player/winner advice ?

CASH Only — Wed, 04 Sep 2002 08:41:49 GMT

Re the article posted this morning on financial advice upon winning: I've not commenting on the fact that the 60-day rule does not apply for all games where players have the choice of cash or annuity. Rather, the Mr Don Haisman mentioned in the story apparently is trying to say that most lottery players/winners should not choose the lump sum. I respectfully disagree of course. It must be remembered that the 30 payments in FL Lotto and in several other games (and Powerball starting next month... [ More ]