Bloodslick

I imagine that this thread has happened elsewhere. Imagine that this is its comeback, like Transformers, My Little Pony, and pet rocks have all had.

Let's say that you won $20 million USD, and were the sole holder of a winning ticket. You have the choice of being paid an annuity, or receiving a lump sum equal to about half the total prize. Which would you choose? What would you do with the money?

Before reporting my win to the state's lottery commission, I would retain a lawyer to review the terms of the annuity contract. (Lump sums are for those with no imagination.) I would find permanent legal counsel who was well-versed in business law, and I would hire a full-time accountant to keep my books. I would start investing based on my newly-retained financial planner's advice, in stocks, mutual funds, and new business and real estate ventures. I would donate to charity, and I would self-incorporate so that the things I spent money on in the name of business would be tax-deductible.

I would basically plan my life so that I never, ever had to work again. I could probably buy a very nice car my first year. Two years down the road, I'm sure I would have enough to buy myself a reasonable house, or to have one constructed. By the end of my lifetime, I might just have enough money in enough places with enough legal protection that I wouldn't know how to get rid of it all. Wouldn't that be nice?

Edit: I made a mistake above. Lump sums are for those with too much imagination and little practical sense.

im2smrt4u

I'd get a lump sum and invest it myself. You don't get paid interest while they sit on your winnings for 26 years.

Also, my first purchase would be these:
http://www.tfproject.org/tfp/showthr...threadid=36486

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taliendo

to fuck with practicality, i would take the lump sum. Who knows if I'm going to die tomorrow?

I'm not a very materialistic person, but I can say that I would buy a decent car probably a nice Volkswagen, a normal three or four bedroom house, pay off my debt as well as my parent's debt. Buy them a new house and a few new vehicles. Get a few choice "I really want that items" such as a collection of instruments. I would throw one hell of a party and then quietly invest the remainder of the balance -- whatever's left, trust me it would be more than 75 percent of my original winnings.

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Mehoni

The whole thing, right now.

I would get my teeth fixed, decorate my apartment, buy a tv, have laser surgery done to my eyes, buy a dvd-burner, put away a whole lot of it, give money to Amnesty an "stadsmissionen (an organization that helps the homeless), go to Japan, buy a whole lot of Lego, buy all the books I want (they cost atleast $100, expensive stuff). Then I would read all the books and use all the stuff.

I lack imagination I see, because I wouldn't buy a big house or a car or a plane or anything. $2 million dollars would prolly do for me, hehe.

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Snoogans

Exactly.
I would live the remaining years of my life in complete happiness and freedom.

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Halx

Being paid over time means you'll probably get 500k per year after taxes. You can easily live on 100k/year, even in Orange County or some place safe and ritzy, so reserve that for living costs, insurance and entertainment. Put another 100k/year into a bitchin' home and a bitchin' car. Save the remaining 300k that you get every year and divide it between retirement accounts, mutual funds and maybe a couple real estate investments.

Also, don't give shit to anybody.

The result is 40+ years of comfortable living. If any of your investments have paid off over time, then you get to live even longer in the lap of luxury.

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SecretMethod70

Halx pretty much summed up what I would do with the sum of money ( )

No need for a lump sum now - sure, there's no interest on it over the time they pay it to you, but even in 20/30 years, 500k is still going to be a lot of money (well, I hope so, then again I really don't know). Nonetheless, through investing the surpluss money each year, it'll build up a pretty good savings for retirement.

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bundy

i know this little fantasy.
i´d buy a place in Tahiti, or the Marquises... then i´d invest the rest so that i could live comfortably as a writer/artist for the rest of my days. i´d probably establish a small, boutique beach hotel. and i´d have to establish some fantastic satellite internet connection.
i´d then marry a sweet young local girl, and live happily by the tranquil pacific.

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ShaniFaye

I would take one lump sum, pay off the usual debts, move to scotland, buy me a castle(fix it up somewhat) and some highland cows, hire some men to wander around in kilts all the time and live happily ever after

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splck

Our lotteries here pay out in lump sums and are tax free. If the winnings were paid over time, I'd opt for that. There's no bank in the land that wouldn't allow you to buy shit on credit if they knew you were receiving a payment of $50,00 a month for the next 25 or so years.

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foolio7714

Lump sum and invest it myself. I Believe your winnings can't be transferred, so if you die with 10 million dollars still owed to you by the lottery, your family gets nothing. So take it all now, spend some, save some, and put a full court basketball court in your house. Yeah!

BonesCPA

I disagree. You are going to have people coming out of the woodwork, especially family. You "can't" turn down family and still go to weddings, funerals, etc. So I would give everyone in the family (aunts, uncles, first cousins but not cousin's spouses or kids) a specific amount of money - if we are talking the million per year, probably $5,000. With it I would put a letter to the effect of: "I have been fortunate, so here is $5,000. I am giving this as a gift, without you asking. This is the only gift of this money I am giving you. If you ask for anymore, for any reason, you will no longer be considered my family." My parents, brothers, sisters, children, grandchildren (if any exist), would get what they need, but everyone else would only get the one time payment.

Anywho, I would take the annuity. The first year's money would go to pay down all debt. Future years would go into investments that would pay a monthly dividend or interest. Figuring a 6% return, each half million would produce $2,500 per month. After three years or so, you probably could stop working. From there, who knows.

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yournamehere

Ya think?
Just don't hire Mike Tyson as your financial advisor, and you'll have a fair chance.

I would take the lump sum for this reason - the Rule of 72 states that compound interest will double your money in a situation where (time in years) X (interest rate) = 72
The lottery commission is basically doubling your income over 20 years. That's an average interest rate of 3.6%. I think I can do better than 3.6% on my own, thank you.
Of the $10M, I would set aside $5M for me and my family to invest and live large on, and set up an annuity for a N-P foundation to give away the other $5M in a 20-year period..

It's always been a fantasy of mine to be sitting in a diner or somewhere and overhear someone's sincere tale of misfortune, then walk over and write them a check to pay off their house, or medical bills, or whatever. All anonymously. I'm hoping this stems more from a streak of altruism than from a desire for personal power. Hell - I'll use my own $5M for the power trip.

Edited Later: I forgot to add - unlike <b>Bloodslik</b>, I would not quit my job - I enjoy it too much.

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Bloodslick

I like the responses I've seen so far. I think part of the reason I chose the route I did is that it represents an "old money" view instead of a "nouveau riche" one. I'll go buying all of the fancy things when I know that recovering from a bank failure or natural disaster or health issue isn't going to wipe out my fortune. All of those things are expensive, perhaps more than you might realize. If there were fiscal merit in taking the lump sum over the annuity, I would follow my financial planner's advice, but they would have to present a fine argument.

Any other thoughts?

Conclamo Ludus

I would take the installments and use them as a supplemental income to live very VERY comfortably without going insane over how fast I'm spending it. I'm quite happy with my material possessions, and it seems that with more money you only get more bills. I'd try to find new and intersting ways to spend an extra 500k a year. I like Halx's answer. Very comfy.

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Psivage

I would by my dad business from him so he can retire, build a new place for my parents, paid off my friend college bills, buy me a place with lots of acreage and private, get me a Saint Bernard Dog. Go hog wild on DVD, and comics. Give to Shriner Hospital, and whatever the major charity for finding a cure of kidney diseases. Set up account for my nieces and nephews for college. Then tell the world to fuck off.

dragon2fire

i would give the money to charity

and take the lump sum


i dont want to be rich

Conclamo Ludus

great answer.

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lurkette

I'd probably take the lump sum and, after paying off my house and other debts and buying a house for my mother, I'd establish a charitable endowment of which I would be the administrator and president. I'd give myself a small salary, slightly more than I'm making now (wouldn't need much after having paid off the house!) and use the money for "entrepreneurial charity" - investing in research on social issues that leads to concrete progress in solving problems. I think I'd focus on homelessness and hunger prevention.

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sailor

Id most likely take the annuity. Although it does depend on whether or not I planned on spending that money quickly. Were you to take the lump sum and stick into something like a large cap index fund, it could easily earn more than the annuity could ever pay you merely by virtue of being there in a larger amount for longer. Never underestimate the power of compounding interest.

Although, to do that, you would have to not spend any of it for a good long time. Therefore, I would probably (after doing the calculations to make sure) take the annuity and just invest most of it. Like Hal said, thats still about 500k a year before taxes.

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jfranco13

I would prefer the lump sum. Mainly because I could get all my debt paid off and pay for a house for myself and one for my family up front, then start investing which is what I'd be doing with the annuity anyway. No reason to wait 2-3 years before you get done with everything you would want to get done right away.

Quit my job, buy a nice car like a G35 and another project car to work on in my spare time. Go back to school and become a teacher if I could, and work for free.

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Jimbob666

Two chicks at the same time, obviously.

jaker

retire in rio

onetime2

I'd go lump sum. Invest in some more real estate, start a couple of businesses (not at the same time but one at a time) that I have plans for, and buy two homes, two boats, and a couple of cars. The rest (should have about $5MM left over after the above) would go into investments (some retirement accounts and some to generate income in case the businesses don't work out).

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Bloodslick

THERE'S the answer I've been waiting for.

You all mention paying off debts. What is this "debt" that you speak of?

dailyjo2003

Lump sum. (Although I've heard that insurance companies will purchase your annuity at a higher lump sum than the lotto people will give you. )

Obtain professional counsel.

Travel.

Build home.

Travel.

Donate some money.

Travel

Repeat.

BuddyHawks

I don't care how I get it, I wont be spendin too fast.
I'd buy a cabin I Northern Wisconsin and go fishing all day. I'd also buy a cabin for my dad.
Season tickets for all Cards games.
The fastest machine with the fastest internet connection (A person with alot of money should not have to experience lag).
I'd make a hefty donation to TFP.
I'd Travel around the world.

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chris2980

id buy games and computer stuff

Halx

I believe that you CAN get by without giving any money to anyone. Besides charities of course. When a family member asks you for money, just grin at them. YES, I AM A SELFISH BASTARD!

Take 'em out for dinner or something, but within a few months, they are gonna realize that you're hard as a rock.

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MSD

I would buy a small, uninhabited isalnd and see how I could do in real-life Sim City.

Fremen

If I won more than 10 million, I'd sign over half of it to World's King.
Just to watch what he would do.

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Finchie

If I can invest the lump sum and get more in the long run, I'd get that. Otherwise, I'd get the annuity. I'm not sure that becoming extremely rich would make me very happy. It might change my personality, and I really wouldn't want that. I really don't want to become a rich asshole who doesn't care for others. I don't think that would happen, but who knows, money can have a bad effect on people.
But once I get my money, the first thing I would do is pay off my college tuition and give money to my parents to help pay their bills. Then I'd buy a new car, a laptop, and some parts for my computer. If I had money left over, I'd look into building an entertainment system and donating the rest of the money to various charities. Other than that, I don't see myself going on a wild spending spree or dropping out of school. I'd probably just keep living how I do now, except I'd buy more "little" things like books, games, etc. I'd still get a job when I got out of college. I don't want to be one of those people that win $100 million dollars and then spend it all away in a few years. How the hell do people do that?

Spinach_Indeed

I'd get the lump sum, because I'm greedy. I want it all and I want it now.

I'd probaly put 2 million away, just in case I end up going too crazy and blowing it all on.. something like a Giant Statue of myself made out of gold.

I always fantasize about blowing very large sum of money on something you normaly wouldn't. Like leaving a 300 dollar tip at some small little Diner, or finding a webcomic or website that has a donate option, and donating 20,000 dollars.

Stull like that.

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sailor

Land. I would buy so much land it would make your head spin. I love isolation--being out in the middle of nowhere with no one else around for miles is one of the greatest feelings in the world. I would buy a huge chunk of land in the Pacific Northwest, one in the southern VA mountains, and maybe one in Texas or New Mexico. Id put a little cabin on it, and be happy.

Oh, and another boat. I miss owning a sailboat

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raeanna74

Annuity
Pay off all my debts
Build my own home - Under 100K
Buy an SUV - Jeep Grand Cherokee Leather (I know some people hate them - including hubby. lol)
Go into Real Estate - Not the selling kind. The buying ONLY kind.
With that much money though I could not just turn the financial planning over to one person. That's why I would go into Real Estate. I can be constantly working with people and yet my money would not be all in one place or in one person's hands. That is except my controller but he would be supervised anyway. Real Estate is one of the best investments. If I can get out of debt that is where I want to go investment-wise.

My dream life is to have my own home and have many children and many animals to care for. That would be what I would want to come home to at the end of the day.

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Nefir

I'd take the lump sum. There are things on my list that I'd rather have *right now*, like:
- A nice house somewhere pleasant, with a nice roof I can put some couches on and have a barbecue.
- A badass telescope, also on said roof.
- All the "L" lenses my camera can stand.
- A nice car
- Some premium-quality musical instruments, and lessons for using them well
- A comfortable life for all my family

When it comes down to it, I doubt I'll be able to just sit there and not work. I'd start a business of some sort, which will be very viable considering I can invest decent sums into it, and will hopefully leave me with a very comfortable life long after the lump sum has been squandered on the material things.

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soccerchamp76

Annuity, here is why: Most people that win the lottery end up bankrupt. Why, you ask? Most people are dumb and blow all the money and buy everyone they know a house/car etc. They end up in debt and the money is gone. With the annuity, you KNOW that EACH year you will get a restock of money, say $500,000.

My plan: Retire, become a teacher.
With $500,000 each year you could buy a million dollar mansion (let's say mortgage it for 5 years or so, at a $1.5 million dollar house; $300,000/yr). That leaves you with $200,000 for a car/bills/etc. plus the teaching money. You buy a top of the line Mercedes/BMW for you and your wife/husband. That is only the first year. After your mortgage is paid off, you both have cars, you now have $500,000 of disposable cash each year for 35 years. Now you start saving and just enjoying life.

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scansinboy

If by chance you should win the lottery, and want to take the annual payment, for Christ's sake, Do NOT turn in the winning ticket right away.
Go see a good lawyer, establish a corporation/company in your name and then, once you are incorperated or whatever, then you present the winning ticket as property of said company. That way, even if you die, the company can still be paid the remaining annual payments.

As for me, I'd open up my own bar/restaurant. do it first class all the way, exactly the opposite way of all the shitholes that I've had the misfortune to work in and asshole bosses I'f had the misfortune to work for over the years. I'd also design my own house, from the ground up, in the prime location of my chosing, and probably buy a nice sailboat. That's about it.

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Tophat665

$20M?

Call my wife. "Honey, just won $20M. Start packing."
"Oh, that's wonderful! Where are we going?"
"I'm not going anywhere."
(Joke. It's a joke.)

Buy all the girls on my block silver plated six shooters and a quart of the finest highland scotch. (kidding)

OK: Hire lawyer, accountant, nanny, maid, architect, personal trainer. Take the accountant's advice on how to get the money.

Spend $1M on designing and building an estate, and another $1M on the land around it.

Start a microbrewery.

Give two weeks notice and quit my job to "go back to school". Go back to school for 1) Applied Mathematics and 2) Brewing.

I figure, that's a quarter of the total $20M at most. Use another quarter to half on the items I list below, and the rest to make sure I never had to work again.

Charity gets NOTHING (unless my accountant advises they do for tax puroposes, in which case the ACLU and NORML have a new friend), but I will help to fund politicians who try to get a welfare state going.

Pay off all family debts & health insurance for 10 years (consult with accountant on exact amount feasible). Ask favorite aunt if she wants to go to college. Get favorite cousin a nose job if she wants it. (She's drop dead, like Veronika, but has an unfortunate proboscis). Buy best friend's mortgage and pay it off. Track down some folks I owe money to from way back (they have probably forgotten) and pay up with interest and apologies. Explore setting up college funds for friends and family's children.

Nuff for now.

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Bloodslick

Wow. My political and social sensibilities really hate that part of your response. Otherwise, sounds good.