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The Lottery WinningsLooks Can Be Deceptive!Many Play, Few will When, and even few will truly win.

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If you were one of the winners,which option would you select?

Why?The annuity seems to the more finically safe, because theoption only has a one time taxation of federal and state, inthis case is 32.2 %.

However, the quicker and faster way is cash option whichusually taxed twice, once from lottery commission whichabout 50% and then the state and federal.

However, once one dies the winnings are consumed by the

state not the family of the deceased, so I would say forsomeone expecting live for the next 26 years this is a greatoption, however if you do not chose the annuity option.

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How much would you receivewith the annuity option?

The annuity is only taxed once, but broken intotwenty-six annual payments.

181,000,000 * .678 = 122,718,000.00

122,718,000/26= 4,719,923.0769

So, if you chose the annual payments one is looking at$4,719,923.0769 every year for 26 years after taxes

But, $6,961,538.46 every year before taxes, annually.

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Is the state of Michigan justifiedin advertising the prize amount

as 363 million? Explain On initial thought no, mainly because of false

advertising, and having individuals believing underfalse pretenses.

However, after further examination I drew formupon the conclusion that they must have apublished cash valued amount to calculate theresult in true value later.

It truly is the consumer/winners ignorance that isunder false belief not the state of Michigan.

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Larrys Annuity payment planinvesting in a risk-free rate of

interest at 5%First and foremost since the investment has no risk,Larry should invest more than the 5%,truly.

Additionally, the outcome demands on the invest andmarket. For instance, if he was to invest the entirelottery winning annually into a 5% risk freeinvestment. He could stand to make $235,996.1538annually , and if he does this for entire annuity of 26

years he stands a chance to make $6,135,900.00 in total

4,719,932.0769 *.05=235,996.1538

235,996.1538 * 26 = 6,135,900.00

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Why do most winners select thecash option plan when given a

choice? Less number of years, not just he least being 26

years. Which will in return increase the paymentsdramatically. This will entice the cash option tochoose the annuity, because the payout is greater.

Also, if there was a large sum available in thebeginning for the winner, then the rest broken into

large options.

Reason being most individuals wish enjoy andspend immediately after winning, not later.

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The EndGood Luck to all winners.