If You Win the $572 Million Powerball Jackpot, Here's How Much You'll Actually Get

NEWS & TRENDING - MONEY NEWS
If you're dreaming of winning the lottery, make sure you know what you'll receive.
Updated June 6, 2024
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The Powerball jackpot has reached unprecedented heights, tantalizing ticket holders' dreams of millions with a staggering $543 million up for grabs. As hopeful participants eagerly await the drawing, we'll delve into what's at stake, where to get in on the action, and explore the possibilities for the lucky winner — all while keeping a watchful eye on the ever-growing pot of gold.

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The enormous jackpot everyone is talking about

The Powerball jackpot soared to a jaw-dropping $572 million this week. The colossal prize comes hot on the heels of a fortunate ticket holder's recent triumph, who claimed the second-biggest jackpot in lottery history just two months ago. The allure of half a billion dollars has once again captured the public's imagination, prompting enthusiasts to wonder who will be the next lucky recipient of this life-changing sum.

The next Powerball drawing

Powerball tickets can be purchased at various authorized retailers across participating states for those eager to test their luck. The last drawing was on Monday, December 18th, and no one again matched all six numbers. Two tickets matched five numbers and won the $1 million prize, but the large Powerball jackpot is still available. 

The next drawing, a potential game-changer, is slated for Wednesday (December 20th). The excitement reaches a fever pitch as hopeful individuals from all walks of life clutch their tickets, each one a potential key to unlocking a new chapter of financial freedom.

How much you could actually win

Should fortune smile upon a Powerball participant in the next drawing, a crucial decision awaits — to opt for the alluring lump sum or a more gradual installment route. Both can come with its pros and cons, and the right one for you might be very different from another winner. Here's how each option would work. 

The lump sum

If you elect the lump sum payment, you would stand to win quite a bit of money. Here's what it would look like: 

$572 million *0.24 (24% federal tax) = $434.72 million 

$434.72 million after a mandatory 24% federal tax withholding offers an immediate influx of cash. 

However, the federal marginal rate, potentially reaching 37%, could further reduce this sum. Here's how that might look: 

$572 million *0.37 = $360.36 million

The total you receive will depend on your taxable income and deductions. No matter how you slice it, that's a large sum that you could use to invest and grow your wealth more than other options, potentially.

Annuity payments

On the flip side, the installment route provides the winner with annual annuity payments for the next 30 years, and it's a great way to avoid larger taxes on lottery winnings. Here's how much you would get:  

30 annual payments of $19.06 million

However, if applied at its maximum, the federal marginal rate could whittle down these payments even more after you pay your taxes each year. It could look like this (depending on your own income and deductions): 

30 annual payments of $12.01 million ($19.06 million * 0.37 each year)

The delicate balance between immediate financial gratification and long-term financial stability adds a layer of complexity to the winner's decision-making process. It also depends on what you want to invest your money into. Investing the majority of the lump sum, depending on the investment, might make you more money in the long term than choosing these payments. It might be best to talk to an investment professional. 

Learning from the past

Reflecting on history, the Powerball has seen astronomical jackpots, with the largest hitting a mind-boggling $2.04 billion. While the lucky winner from Altadena, California, claimed an estimated lump sum payment of $628 million after federal taxes, it underscores the financial impact of opting for the lump sum over 30 annual installments. The allure of such staggering amounts highlights the transformative potential that awaits the next fortunate recipient.

Lottery landscape: Mega millions and beyond

The surge in massive jackpots over the years can be attributed, in part, to strategic rule changes in both Powerball and Mega Millions. These changes, while lengthening the odds of winning the grand prize, give contestants more opportunities to secure smaller prizes. As we focus on Powerball's astronomical jackpot, the Mega Millions also enters the scene with a more modest $41 million on the line. This serves as a reminder that the world of lotteries offers a spectrum of possibilities, from the colossal to the more attainable.

Bottom line

As the Powerball frenzy continues to captivate the nation, tomorrow's drawing hopes to transform one fortunate individual's life. The financial implications are monumental, whether they choose the immediate allure of a lump sum or the steady rhythm of installments. Beyond Powerball, the broader lottery landscape beckons with opportunities for those seeking a shot at newfound wealth. As we stand on the brink of possibility, the lottery remains a captivating arena where dreams and financial realities converge, leaving us all eagerly awaiting the announcement of the next lucky winner.


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Author Details

Georgina Tzanetos Georgina Tzanetos is a former financial advisor who has been active in financial media for the past six years. She holds a master's in political economy from NYU, where she studied distressed labor markets.