Lottery Winners Can Choose Between Lump Sums and Annuities

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The first recorded lotteries in the history of humankind involved money prizes. Dutch towns held public lotteries to raise money for the poor and for various public purposes. They were a popular method of taxation and were widely regarded as a way to generate extra revenue. The oldest operating lotto, the Staatsloterij, was founded in 1726. The English word lotto came from the Dutch noun, ‘loteries’, which means ‘fate’.

When you win the lottery, you can choose whether to receive your prize in a lump sum or an annuity. A lump sum payment may be more exciting up front, but annuity payments require less taxation, so you may want to choose an option that allows you to receive a lump sum in a few years. However, if you do not intend to spend your money right away, annuities can be a good option for you.

Powerball jackpot winners can choose to receive their prize as a lump sum or an annuity. If you choose the latter, your lottery winnings will be split into 30 graduated payments over 29 years. If you want to receive your money over time, you can use an annuity calculator to determine how much you will receive over the years. If you choose the latter option, you will save on taxes and have more money to invest. But you still need to consider the risks involved in taking the cash option.