Who are the Lottery Winners?

Three lucky winners ended up sharing the record-breaking $656 million Mega Millions jackpot. The winnersare from Illinois, Kansas and Maryland – each of them should receive about $100 millions after taxes, which is still more than enough to live comfortably. Winners have the choice between cashing out this amount or receiving a yearly payment for the next twenty-six years.

The identity of the winners is still a secret: these people need time to figure out what to do with their money, go on a spending spree and open up a few bank accounts.

What is best between the cash out option and the yearly installments? A huge percentage of the money goes toward taxes in both cases, but paying taxes on the yearly installments is slightly more expensive on the long run. However, yearly installments make it easier for the winner to manage the money and maintain a comfortable lifestyle. But what happens when thepayments stop? Most winners will spend the totality of their yearly installments to make house and car payments and not invest the remaining money in anything. After twenty-six years, these people will have a lot of valuable possessions but no real plan for the rest of their lives.

Cashing out a huge sum of money is incredibly exciting and could lead to unbelievable spending sprees. If a winner had enough sense not to spend most of their money on useless things, they could actually create a solid portfolio of investments to support themselves for the rest of their lives. This sounds like a much better option if the winner knows how to manage money or finds a trustworthy financial adviser.