About the REAL payout of that Lottery jackpot

[dixiegrrrrl]

The Reality of Powerball

Yes, mathematically it looks good to buy a ticket for a $1.4 billion draw when you have a 1-in-~292 million shot at winning..

But only actual cash in hand winnings matter..
The rest is a fictitious "time value" figure predicated on an annuity, if you do not take lump sum.
That is money in the future, not money today, in hand.

So a cash payout would be around $868 million
then you pay taxes. 39.6% federal, and only 25% is withheld when you get the check.
Plus any state income taxes.

The 868 million assumes you are the ONLY winner.
But as the prize gets bigger, the buying frenzy that develops for each ticket increases the odds of a multiple winner.

Plus, last year the Powerball changed the odds, decreasing them by about half, of hitting the jackpot.

Not that a few million is something to sneeze at.
And eventually people DO win lotteries.

The above is just another way to look at it.

[ileus]

1. You're right...hardly worth the effort of claiming the prize if you have the winning numbers.

[MohRokTah]

2. The annuitized amount is exact, not an "estimate"

That is because the advertised value is annuitized over 30 years and the principal is held in 30 year treasury securities, which is why the cash payout value is so high and the value after 30 years can be precisely calculated.

[B2G]

3. "a few million"?

Recheck your math.

[HassleCat]

4. Keeping it in perspective

If you buy a lottery ticket instead of a Big Gulp, it doesn't matter. If you spend your entire Social Security check trying to improve your odds of winning, you need to seek help. The lottery is a sucker's bet, which is no biggie if you only allow yourself to be suckered for a dollar or two.

[LanternWaste]

5. I'm not sure what the cash prize has to be that would finally compel me to purchase a ticket

I'm not sure what the cash prize has to be that would finally compel me to purchase a ticket on a whim, but we're not quite there yet. Maybe two billion? I'm sure it'll happen one day or another.

[mahatmakanejeeves]

6. Well I'll just tear up that winning ticket then. NT

[JI7]

7. only thing i get from this is if you are going to play

Why not play other times when total winnings are less ? But still a good amount.

[brooklynite]

8. The lottery office is right next door...

...I'll pop over at lunchtime.

[MiniMe]

9. Thanks, I have already bought my ticket

And if nobody wins this time, I will buy a ticket for the next drawing. I only buy 1. It gives me a few days of daydreams if nothing else. At some point, somebody is going to win. I can't imagine that much money, even after paying all the taxes.

[nadinbrzezinski]

11. Here is some perspective

It is about half of the deficit in the infrastructure budget for San Diego

[nadinbrzezinski]

10. If I hit it (snicker) I think I will be ok

With a few million.

Yes, we do buy a ticket when it crosses a threshold. It's nice to have some fun we are aware of the odds by the way. And yes, I have been hit by lightning (inside a car) twice in my life.

[TeamPooka]

12. 60% of $868 million is $520 million. Calling it "a few million" is Republican Math. nt