Lottery Jackpot

A large cash prize in a game or lottery, especially one that accumulates until someone wins it. The term jackpot is also used for similar prizes in other games, including poker and blackjack, as well as some sports events. The winner of a lottery jackpot is generally expected to choose an annuity payment, where the winnings are paid out in annual installments over 29 years, or a lump sum. When choosing between the two options, a winner should consider the time value of money as well as income taxes withholdings, which can significantly reduce the final payout.

Enormous lottery jackpots are becoming more common as players buy tickets at record levels. The current Mega Millions jackpot has reached $1.28 billion, a figure most of us can barely comprehend. The size of the prize is not accidental, according to Victor Matheson, an economics professor at the College of the Holy Cross. He told CBS MoneyWatch that the Multi-State Lottery Association, which oversees the Powerball and Mega Millions lotteries, intentionally designs its games to generate bigger jackpots.

How a winner handles the payout of their jackpot prize requires careful consideration, and probably the advice of experts. For example, accountants can help with tax planning and filings, while lawyers can provide guidance on property transfers and other legal issues. In addition, a lawyer can also be helpful in deciding whether to hire a trust or a private foundation to manage the money. If you plan to use your jackpot to buy a new home, for example, you may want to hire an architect to help you with the project and negotiate a fair price.