R.E.N. Spells Ren
Veteran
he shouldn't take the lump sum tho.
take the yearly payments, that's because of the year you get the chance to see how you are handling the money.. are you giving it to leeches, bad investors/financial advisors or spending it on tigers and monkeys...
it will give you a sense of i really need to see where i'm throwing my money at
From a purely financial standpoint it's always better to take the lump sum since the lump sum is the actual cash they have collected for the jackpot since the last time someone hit. With the annuity, it's the amount they are willing to guarantee you they can pay over that 30 year period by placing that pot of cash in an investment vehicle. If they're willing to guarantee a payout of $450M over 30 years, surely you can beat that using another private equity firm, easily.
However, given his age and likely ignorance about money, he'd almost certainly be better off with the annuity. That way he can adjust to his newfound wealth, make his mistakes, and still get an 8 figure check every year to balance things off.
Personally, tho, I'm always taking the lump sum.
You can also use Usamega to figure out what your state will take out.
Mega Millions Jackpot for Fri, Jan 5, 2018
$451,000,000
$281,900,000
Florida: No State Tax on Lottery Prizes!
Your average net per year: $11,275,000 Your net payout: $211,425,000
After 30 payments: $338,250,000
Mega Millions Jackpot Analysis | USA Mega
Powerball Jackpot Analysis | USA Mega
One thing to note is that no one can predict what tax rates will be in the future. If they raise the taxes on high income earners in year 10, then those checks, and his net payout will be less than the figures listed there.