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When I win the lottery....
- Thread starter jen
- Start date
Russell Jaslow
Registered User
Re: When I win the lottery....
The article does specifically state that if the grand jackpot is split, then you're back to square one...
But like others state, it does take into account all the other sub-winners, as that is locked in from the start.
The article does specifically state that if the grand jackpot is split, then you're back to square one...
But like others state, it does take into account all the other sub-winners, as that is locked in from the start.
Russell Jaslow
Registered User
Re: When I win the lottery....
Here's a "scary" thought for those involved in "office" pools, especially if you're the one who "owns" the ticket:
Generosity could result in Powerball winners taking home even less. If you anticipate sharing the prize money, make that agreement before the numbers are drawn (as you would with an office pool), said Labant. Otherwise, the money is a gift rather than income for those recipients, she said — meaning you, the giver, will be the one paying all the income taxes as well as any gift taxes resulting from a substantial split.
Triggering the gift tax is easy to do, with such a big prize. The IRS allows you to gift up to $14,000 per recipient each year, tax-free, with bigger gifts eating away at your lifetime exemption of $5.45 million. (Gifts to a spouse are unlimited.) Exceed that, and the gift tax is a flat 40 percent.
Donated again to a work pool. One of the engineers started researching the cost of small South Pacific islands again.
Here's a "scary" thought for those involved in "office" pools, especially if you're the one who "owns" the ticket:
Generosity could result in Powerball winners taking home even less. If you anticipate sharing the prize money, make that agreement before the numbers are drawn (as you would with an office pool), said Labant. Otherwise, the money is a gift rather than income for those recipients, she said — meaning you, the giver, will be the one paying all the income taxes as well as any gift taxes resulting from a substantial split.
Triggering the gift tax is easy to do, with such a big prize. The IRS allows you to gift up to $14,000 per recipient each year, tax-free, with bigger gifts eating away at your lifetime exemption of $5.45 million. (Gifts to a spouse are unlimited.) Exceed that, and the gift tax is a flat 40 percent.
Kepler
Si certus es dubita
Re: When I win the lottery....
Which is why rule 1 is the instant you win you hire a financial planner. I wonder if it makes sense for the work group of winners to form some sort of entity just for the purposes of determining who to install as a money manager, how to pay them, etc.? It might be a good idea to pool the cost of a CFP / Estate Planner / Whatever, who I imagine are pricey, not to mention that moving it to an impartial professional saves aggravation and likely friendships when people start disagreeing on process.
Which is why rule 1 is the instant you win you hire a financial planner. I wonder if it makes sense for the work group of winners to form some sort of entity just for the purposes of determining who to install as a money manager, how to pay them, etc.? It might be a good idea to pool the cost of a CFP / Estate Planner / Whatever, who I imagine are pricey, not to mention that moving it to an impartial professional saves aggravation and likely friendships when people start disagreeing on process.
Re: When I win the lottery....
Take 90% of your profits, invest in a slow, but steady investment. Hell, at this amount, just a simple bank account or long term-CDs would suffice.
You could burn the rest of it in a massive "I Won The Lottery" Bonfire, and unless you are beyond stupid, you will be set for life. Of course, just burning the money you didn't invest would prove that fact, but I digress....
Take 90% of your profits, invest in a slow, but steady investment. Hell, at this amount, just a simple bank account or long term-CDs would suffice.
You could burn the rest of it in a massive "I Won The Lottery" Bonfire, and unless you are beyond stupid, you will be set for life. Of course, just burning the money you didn't invest would prove that fact, but I digress....
Re: When I win the lottery....
If one individual wins it all, I will feel sorry for that person as their life will never be the same again.
Say the take home lump sum is $1 billion. If you earn 1% on it, thatz $10 million a year in income and about $5 million after taxes and expenses.
How in the heck do you spend $5,000,000 a year for the rest of your life and not be changed?
I'll let you know.
If one individual wins it all, I will feel sorry for that person as their life will never be the same again.
Say the take home lump sum is $1 billion. If you earn 1% on it, thatz $10 million a year in income and about $5 million after taxes and expenses.
How in the heck do you spend $5,000,000 a year for the rest of your life and not be changed?
I'll let you know.
FlagDUDE08
Banned
Re: When I win the lottery....
Jumbo CDs.
Just don't get caught defacing money, as it's technically illegal.
Jumbo CDs.
Just don't get caught defacing money, as it's technically illegal.
FlagDUDE08
Banned
Kepler
Si certus es dubita
Re: When I win the lottery....
Since today's my last day before becoming an eccentric billionaire recluse, I just want to tell you all it's been great knowing you.
Since today's my last day before becoming an eccentric billionaire recluse, I just want to tell you all it's been great knowing you.
Twitch Boy
Defacing this tagline is a MAX foul
Re: When I win the lottery....
Just don't leave any steak for him in catering. The rest will work itself out.
How much would it take to remove Clarkson?
Just don't leave any steak for him in catering. The rest will work itself out.
Re: When I win the lottery....
Two other things I would probably do were I to win:
-- buy lots of life insurance. I could afford it and that would expand the social good I could do with the money long after I am gone.
-- endow our local listener-supported radio station (privately supported public radio, not NPR. it's a great station).
Two other things I would probably do were I to win:
-- buy lots of life insurance. I could afford it and that would expand the social good I could do with the money long after I am gone.
-- endow our local listener-supported radio station (privately supported public radio, not NPR. it's a great station).
Re: When I win the lottery....
Just bought a ticket. My current plan:
Trust funds for immediate family members. A trust fund for my son that he would get after he finishes college and works for a few years. I'd invest $50M for my 'income' (and I highly doubt I would be able to spend the return on 50M no matter how hard I tried, I don't care about accumulating any more 'stuff' and there is only so much traveling you can do). I'd probably have to move. Nothing fancy, but would need some privacy so maybe around $1M for a house, and another $500K for a off-grid vacation cabin. I'd invest some money for taxes and upkeep on these two properties. No exotic cars, no private jets, no 10,000 square foot home.
$100M for UMaine, split between endowed chairs and scholarships. The rest of the money would go into a charitable trust. My wife, son, and I would spend a portion of our time deciding where that money will go. The rest of the time we'll travel a lot. And not to fancy resorts. National parks, Patagonia, Nepal, Greenland, Tanzania...
Just bought a ticket. My current plan:
Trust funds for immediate family members. A trust fund for my son that he would get after he finishes college and works for a few years. I'd invest $50M for my 'income' (and I highly doubt I would be able to spend the return on 50M no matter how hard I tried, I don't care about accumulating any more 'stuff' and there is only so much traveling you can do). I'd probably have to move. Nothing fancy, but would need some privacy so maybe around $1M for a house, and another $500K for a off-grid vacation cabin. I'd invest some money for taxes and upkeep on these two properties. No exotic cars, no private jets, no 10,000 square foot home.
$100M for UMaine, split between endowed chairs and scholarships. The rest of the money would go into a charitable trust. My wife, son, and I would spend a portion of our time deciding where that money will go. The rest of the time we'll travel a lot. And not to fancy resorts. National parks, Patagonia, Nepal, Greenland, Tanzania...
Re: When I win the lottery....
Out of curiosity, I googled up this article regarding giving lottery winnings to charity.
Bottom line: You can only give away 50% of your AGI tax-free. So if you win $1B (and let's assume your other income is irrelevant!), you can give away $500M tax-free, leaving you to pay tax on the remaining $500M of AGI. That works out to $198M per some random tax calculator I found. The IRS takes 25% off the top for withholding, which is $250M, so in 2017, you'd get a tax refund of 250-198 = $52M. So the net breakdown of where the $1B goes would be:
Charity: $500M
IRS: $198M
You: $302M
That seems like a good plan to me.
Anyone know the # for the Gates Foundation? I'm gonna need it tonight!
Out of curiosity, I googled up this article regarding giving lottery winnings to charity.
Bottom line: You can only give away 50% of your AGI tax-free. So if you win $1B (and let's assume your other income is irrelevant!), you can give away $500M tax-free, leaving you to pay tax on the remaining $500M of AGI. That works out to $198M per some random tax calculator I found. The IRS takes 25% off the top for withholding, which is $250M, so in 2017, you'd get a tax refund of 250-198 = $52M. So the net breakdown of where the $1B goes would be:
Charity: $500M
IRS: $198M
You: $302M
That seems like a good plan to me.
Anyone know the # for the Gates Foundation? I'm gonna need it tonight!
St. Clown
Ideas Posted are Likely Not My Own
Re: When I win the lottery....
If there's one axiom in economics that holds true outside of the principles, it's that people will always find a way to adjust their lifestyles to their newly expanded budgets. A $50MM investment, with a safe yield of 3%, would gross $1.5MM in revenue, less account fees and earned income tax rates, and you're right around $750K, probably just under. People can spend that with very little effort, and that's not on items that will accumulate their physical possessions.
If there's one axiom in economics that holds true outside of the principles, it's that people will always find a way to adjust their lifestyles to their newly expanded budgets. A $50MM investment, with a safe yield of 3%, would gross $1.5MM in revenue, less account fees and earned income tax rates, and you're right around $750K, probably just under. People can spend that with very little effort, and that's not on items that will accumulate their physical possessions.
JF_Gophers
2147483647
Some of those expenses don't even make sense. Like $3400 for phones.
Re: When I win the lottery....
But from what some people my children's age tell me, he's getting a bargain on child care.
But from what some people my children's age tell me, he's getting a bargain on child care.
Re: When I win the lottery....
Really? Remember that when this list was done (divorce in 2008, so the expenses are probably 2007 numbers), most plans were not unlimited texts or minutes. My inlaws (with 3 teens still at home) routinely had bills in the $800 range. I know, because we heard about it A LOT. I can easily see Shaq using 4x as much - phones for his assistants, kids, wife, guest houses, cars, boats, etc, etc.