Lump Sum or Installments?

  • November 24, 2004

Something fun to distract one on a rainy Wednesday: if I won the lottery, would I take the lump sump payment, or the installments over X years? The answer, of course, is "it depends". How old are you when you win, what's the annuity percentage on the installment plan, how much debt do you have, is there a "Best Buy" on the way home from the lottery claim center, etc. Oh, and I guess I'd have to play the lottery in the first place for this to matter much anyway. What would you do?

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November 24th, 2004
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Written by:
Ian Bicking
Posted on:
November 24, 2004 at 1:22 pm

I'd bet on deflation (-ary pressures), so I'd go for annuity. Well, maybe I'd bet on the current tax laws being favorable, and go for lump. Damn, it is hard, isn't it?

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Written by:
derric
Posted on:
November 30, 2004 at 3:14 pm

um... this is all a foreign language to me as i don't speak econ. it's a much more emotional question--would i be smart enough to invest a lump sum or would i turn into David Lee Roth and spend it all on fast living...