Okay,
I'll get into this fray.
MegaMillions just had a $267 million dollar winner in Ohio. It wasn't me, either. Therefore, the jackpot is back down to 12 million, pay out on a 26 year annuity. By the way, the person who asked about why the lump sum is substantially less. If you take the full annuity, the amount of money is invested into an 'Annuity' (which is why it's called that!) and then paid out over the life that annuity. While in the Annuity, it collects interest, which is what you're paid, along with some principal. If you take the 'lump sum', that is the actual amount of the lottery jackpot. If you invest that exact same amount in another annuity, with the same interest rate, you will have the same amount of money at the end of the annuity term.
Okay, now, Mega is back to 12 million, that works out to about $460,000 a year, or a little less than $300,000 a year, after taxes. So, let's say $300, 000 after taxes.
I will purchase a small plot of land, and build a three bedroom house on it. $150,000
I will pay off my '05 Malibu. I will not get another car. $20,000
I will spend $50,000 and go back to school to finish my pilot ratings. That should take six months.
I will give some family members up to $10,000 a piece. $30-40,000
Right there, I'm at close to the max. That leaves me about $40,000 to live on, less than what I make now per year, although more 'real' money, because the taxes have been paid.
In the second year, I buy my airplane!
Gary