It can be hard to decide how you want your Powerball winnings to be paid out to you. Fortunately, there are people who can help you make this decision. Financial advisors such as tax preparers, investment counselors, and budget consultants can all be of assistance to you during this time of major decisions making.
Financial professionals have often helped many people decide what option is best for them. The major reason why many people choose to have an annual payment sent to them is because they will be awarded an increased amount to help account for inflation costs. Otherwise, if they take the cash lottery amount they will just receive the principal amount. No further payments will be sent to the winner.
If you choose the cash option it will be sent to you all at once, as mentioned in the previous paragraph, and you will be responsible for paying taxes on that entire amount. If you choose to have your prize payments sent to you annually you will receive payments every year for 29 years in a row. Each payment will be increase by a certain percentage as well, in order to keep up with inflation rates.
If you have just won the Powerball grand prize, you will usually have up to 60 days to decide how you want your reward paid to you. This is why many people consult professional financial advisors. Those advisors will help you decide what your overall monetary goals are, and they will help you define a useful purpose for the money. They will help steer you in a direction, which will ensure that your lottery winnings, especially if you win the grand prize or one of the first three cash prizes, will stretch out as far as possible.
There are pros and cons to choosing either type of lottery cash payment. Some people would cash option over the annuity option for a variety of reasons. For instance, those who choose the cash option may consider the principal amount more than enough to meet their needs, even after taxes.
Some people would use the cash from a lottery payment to help them fund their dreams that they never thought could come true. For instance, they can take long vacations, and possibly reduce the number of hours worked on a job, or even or eliminate needing to work a job altogether.
Furthermore, they can improve their home, pay off past debts, and help their families, and give money to charities. Likewise, they may not want to wait to get their hands on their money, and they may feel more secure knowing it is in their hands already.
Another reason why people would want to consider the cash option is they may want total control on how they want to invest the money in order to profit from it. For instance, they may use a portion of the money for business or corporation start-up costs, and they may need a lump sum to get started.
They may also decide they want to purchase real estate with it, or they may consider purchasing stocks or bonds. The reason some people would do this with their lottery winnings is because even though these are riskier investments rather than just accepting annuity payments they could also be more profitable as well. If you are considering the cash option of lottery payout you can talk to your financial advisor about various investment options that can bring you a better return than annuitized lottery ticket payments.
There are reasons why people would want to have annual payments sent to them as well. For instance, some people like the idea that the increased payment amount every year covers the rate of inflation. This will help people to earn what they feel is rightfully their Powerball lottery cash prize. Furthermore, they will still be able to use the annual payments to invest if they want to. They would just have a smaller lump sum from year to year to work with.
If you need help regarding lottery winning investment opportunities it is highly recommended that you seek out a financial advisor whose judgment you trust. If you need to find someone you can ask around, or search for an advisor by using your web browser.