Where would you go for financial guidance if you win the Megamillions?

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timmy
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by timmy » Sat Oct 20, 2018 7:03 am

I would post my progress on the "wealth progression thread". The drop the mic ...

Nissanzx1
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by Nissanzx1 » Sat Oct 20, 2018 7:12 am

I would hire a good estate attorney and manage everything myself. I'd spend most of the next few years aquiring real estate.

I would be looking at ways I could really help people in my community- really trying to solve issues for the long term. I would even possibly create a low-fee, low-cost payday lending service that could put all of the dozens in my town out of business.

I wouldn't win though because I've never played, and never will...

3funder
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by 3funder » Sat Oct 20, 2018 7:35 am

1. Don't tell a soul.
2. Refuse the lump sum option; instead, choose the annuity.
3. Consult a fee-only financial advisor.
4. Consult an attorney who deals with estates and taxes.
5. Whatever portion you choose to invest, invest it in low-cost index funds.
6. Donate to charity.
7. As the years pass, keep investing in low-cost index funds and donating to charity.

wrongfunds
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by wrongfunds » Sat Oct 20, 2018 8:31 am

Sincere question:-

How do they know the pot now will be 1.6 Billion? Do they just use the previous history to project the future size? We all know how future is never guaranteed to repeat the past etc. Besides, they seem to be assuming exponential curve here i.e. the growth for next one is higher than the growth for the yesterday. Have the lottery official pegged us so well?

MnD
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by MnD » Sat Oct 20, 2018 9:07 am

MAJIC9 wrote:
Thu Oct 18, 2018 11:41 am
15+ years ago my coworker won large (>100MM)... didn't change the name... probably no one really knows (nor still remembers) they won.. this country moves on quick... (they did not even try to conceal it by claiming anonymously).. seems to have worked out for them but they were smart and down to earth to begin with.
Exactly. This whole idea that one has to be anonymous and disappear like a mob informant in an era when people with enormous wealth are everywhere is rather amusing. I'd move to a luxurious home with privacy and security like is common among most rich people well-known or not, get some financial help but still be very hands on and engaged and I doubt I'd OK anything exotic or expensive and call it good. I suspect that "top" estate planners that cater to the suddenly wealthy (sports, entertainment, lottery) take them to the cleaners with all kinds of fancy things they don't understand and involve very high fees and costs. That's probably their biggest real threat.
Last edited by MnD on Sat Oct 20, 2018 9:31 am, edited 1 time in total.

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Shackleton
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by Shackleton » Sat Oct 20, 2018 9:27 am

I would hire Klangfool and run every purchase or investment past him just to keep me cognizant of what could happen if the excrement hits the airflow device.
“Superhuman effort isn't worth a damn unless it achieves results.” ~Ernest Shackleton

moghopper
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by moghopper » Sat Oct 20, 2018 9:35 am

wrongfunds wrote:
Sat Oct 20, 2018 8:31 am
Sincere question:-

How do they know the pot now will be 1.6 Billion? Do they just use the previous history to project the future size? We all know how future is never guaranteed to repeat the past etc. Besides, they seem to be assuming exponential curve here i.e. the growth for next one is higher than the growth for the yesterday. Have the lottery official pegged us so well?
I believe that is the minimum based on sales in the last few days. The last cycle, the first day it was at $828M, and then it went to $900 after a day. I suspect that this 1.6B is the minimum, and we'll see it rise by Monday.

CULater
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by CULater » Sat Oct 20, 2018 10:09 am

The bad news is that I didn't win last night's drawing. The good news is that nobody did and the jackpot is now estimated to be 1.6 Billion, the largest in history. The lump sum option will be almost a billion - just a little carrying around money. So I guess I'll be going down and getting some tickets. Estimated value of $2 ticket is about $5, so maybe I'll get three this time. Strictly an objective investment decision. :thumbsup
May you have the hindsight to know where you've been, The foresight to know where you're going, And the insight to know when you've gone too far. ~ Irish Blessing

wrongfunds
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by wrongfunds » Sat Oct 20, 2018 10:44 am

moghopper wrote:
Sat Oct 20, 2018 9:35 am
wrongfunds wrote:
Sat Oct 20, 2018 8:31 am
Sincere question:-

How do they know the pot now will be 1.6 Billion? Do they just use the previous history to project the future size? We all know how future is never guaranteed to repeat the past etc. Besides, they seem to be assuming exponential curve here i.e. the growth for next one is higher than the growth for the yesterday. Have the lottery official pegged us so well?
I believe that is the minimum based on sales in the last few days. The last cycle, the first day it was at $828M, and then it went to $900 after a day. I suspect that this 1.6B is the minimum, and we'll see it rise by Monday.
But if there was a winner yesterday, then the pot would have been less than a billion, correct? Or are you saying that by Friday's close, it was already at 1.6B? I find that hard to believe.

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VictoriaF
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by VictoriaF » Sat Oct 20, 2018 10:57 am

wrongfunds wrote:
Thu Oct 18, 2018 12:49 pm
VictoriaF wrote:
Thu Oct 18, 2018 12:16 pm
Don't bother with small change. Skip this Friday and play for 3 commas next week.

Victoria
What makes you so certain that *I* will not win the jackpot this Friday? I have already planned on how to handle the prize money. Please don't throw monkey wrenches in my plan.
20 Oct 2018: I told you!

Victoria
WINNER of the 2015 Boglehead Contest. | Every joke has a bit of a joke. ... The rest is the truth. (Marat F)

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whodidntante
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by whodidntante » Sat Oct 20, 2018 10:58 am

I would invest the money very similarly to how I do now. If there were a better way, I would be doing it already. I would seek advice on tort liability protection and tax liability reduction, but not for investments.

wrongfunds
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by wrongfunds » Sat Oct 20, 2018 11:21 am

Was there ever a time when Victoria was wrong? That time will eventually come but so far it has not come!

CULater
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by CULater » Sat Oct 20, 2018 11:35 am

Talk to you later. I have to go to the Chinese restaurant to get my fortune cookie with the numbers for Tuesday's drawing.
May you have the hindsight to know where you've been, The foresight to know where you're going, And the insight to know when you've gone too far. ~ Irish Blessing

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Re: Where would you go for financial guidance if you win the Megamillions?

Post by Silverado » Sat Oct 20, 2018 12:50 pm

MnD wrote:
Sat Oct 20, 2018 9:07 am
MAJIC9 wrote:
Thu Oct 18, 2018 11:41 am
15+ years ago my coworker won large (>100MM)... didn't change the name... probably no one really knows (nor still remembers) they won.. this country moves on quick... (they did not even try to conceal it by claiming anonymously).. seems to have worked out for them but they were smart and down to earth to begin with.
Exactly. This whole idea that one has to be anonymous and disappear like a mob informant in an era when people with enormous wealth are everywhere is rather amusing. I'd move to a luxurious home with privacy and security like is common among most rich people well-known or not, get some financial help but still be very hands on and engaged and I doubt I'd OK anything exotic or expensive and call it good. I suspect that "top" estate planners that cater to the suddenly wealthy (sports, entertainment, lottery) take them to the cleaners with all kinds of fancy things they don't understand and involve very high fees and costs. That's probably their biggest real threat.
Yeah, I chuckle at these threads because so many people say to get some wealth management firm involved. I am with you, likely just going to take them to the cleaners. However, since they start with millions and millions and millions, likely don't even realize a simple three fund with a moderately conservative allocation would do a better job. I view it a little bit like executive compensation for public companies, make it so complex and interconnected that shareholders don't even know what's going on and the comp committee can justify their exorbitant hourly rate.

MnD
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by MnD » Sat Oct 20, 2018 1:05 pm

Jackpot!
1 megaball match ($2), 1 megaball plus one number match ($4) and one 3 out of 6 number in Lotto (state lottery game) match ($3).
A $9 dollar haul on only a $15 investment thanks to my diversified approach to lottery portfolio design.
I'm off to erase my history in Google images and call the wealth pro's.

Maya1234
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by Maya1234 » Sat Oct 20, 2018 1:14 pm

“This whole idea that one has to be anonymous and disappear like a mob informant in an era when people with enormous wealth are everywhere is rather amusing. “

So true. When I inherited millions the advice here and other places was “Don’t tell anyone” but we were previously always the “poor” ones here with only 2 million. I know so so many people with lots of money. At work many of my bosses are worth 8- 30 million. No one wold think twice or have any overwhelming interest in me catching up on the low end with them. Many people in my town are worth much much more than us.

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Re: Where would you go for financial guidance if you win the Megamillions?

Post by Spirit Rider » Sat Oct 20, 2018 6:12 pm

dknightd wrote:
Wed Oct 17, 2018 5:03 pm
I would not sign the back of the ticket. I'd see if I could set up some kind of legal loophole that would let me stay anonymous.
As of this year there is precedence in at least one non-anonymous state for retaining your anonymity when claimed by a trust even if you sign the ticket. This was a $500M+ Powerball ticket and the judge ruled in the favor of a winner who followed the lottery's own guidance and signed the ticket before getting legal advice.
BanditKing wrote:
Wed Oct 17, 2018 7:03 pm
My first question would be, can I move to another state without an income tax and then claim my prize, allowing me to not owe state income taxes on the winnings.
Nope, it is like working in a no income tax state and working in a state with an income tax. The lottery winnings are first subject to the income taxes of the state where you purchase the ticket. Then if the income tax in your state of residence is higher, you will be subject to the difference.

typical.investor
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by typical.investor » Sat Oct 20, 2018 6:22 pm

ginmqi wrote:
Sat Oct 20, 2018 5:55 pm
So I was in a discussion on another internet forum and with a few friends regarding potential investing after you come into an extremely large sum of money/windfall. One could say the source of such money can be either inheritance or sheer....luck (and I think most of us know where this luck may come from....).

Let's suppose this liquid sum is north of 500 million dollars, after taxes.

Ignoring how you actually come into this money, if you were suddenly thrust into a role where you are the owner of said amounts of money, is it still prudent to use the boglehead principle to invest this sum? Lazy portfolio, 3-fund portfolio.

When I discuss such investment strategies, I get responses like "You're naive." "You're stupid." "You can't do plebian investing with this much money. You need a team, a family office to manage this much money!" "Billionaires and UHNW individuals don't invest in simpleton places like index funds, you need help."

So am I just way too naive, or is it reasonable to treat a 500 million dollar bank account the same as a normal household bank account? (obviously the 500M account will need at least additional help interms of tax accounting, using professional CPA and/or lawyers....)

I apologize in advance if this has already been discussed before but I was not able to search easily this kind of topic. Thank you.
From a tax perspective, that much money would invite strategies that would give you tax breaks.

For example, one real estate investor offset $1.7 million in salary and investment gains with $8.3 million of (paper) losses due to depreciation. This enabled that person's net worth to quintuple to almost $324 million apparently without paying anything in taxes.

Given that it seems the general opinion here to be sure and use the tax code in a legal way to minimize your liability, I am sure many here would eventually try a financial advisor who could help them in that way.

moghopper
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by moghopper » Sat Oct 20, 2018 8:11 pm

wrongfunds wrote:
Sat Oct 20, 2018 10:44 am
But if there was a winner yesterday, then the pot would have been less than a billion, correct? Or are you saying that by Friday's close, it was already at 1.6B? I find that hard to believe.
Not what I was saying. The drawing on 10/16/2018 was for $667 Million. On 10/17/2018 (after the drawing) the pot was $868M. By 10/19/2018, the pot had additionally increased to $900M, and then $1B.

$900M (10/17/2018)
https://www.nbcnews.com/news/us-news/no ... on-n921021
(This also references the $868M figure in the article.)

$1B (10/19/2018)
https://www.nbcnews.com/news/us-news/me ... on-n922111

My point is that this won't stop at $1.6B. It will go up again before the next drawing. Probably both on Monday and Tuesday.

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Re: Where would you go for financial guidance if you win the Megamillions?

Post by AlphaLess » Sat Oct 20, 2018 8:59 pm

A few comments:

1. Bad news: you did not win the Fri edition,
2. Good news: the upcoming edition has a $1.6B headline number,
3. You will get a massive discount for a lump-sum,
4. You will get hit with taxes.

I would put the main concerns as follows:

1. Anonymity (claim it under the name of a trust, if state allows it),
2. Tax planning,
3. Security.
4. Asset allocation.

I think asset allocation would be the least of my worries. Any allocation from {20,80} to {80,20} would do. With that much money (assuming you are not a billionaire already), you can probably make do no matter the asset allocation.

For #1,2, and 3, a good law firm is necessary.
"You can get more with a kind word and a gun than with just a kind word." George Washington

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Re: Where would you go for financial guidance if you win the Megamillions?

Post by AlphaLess » Sat Oct 20, 2018 9:01 pm

CULater wrote:
Sat Oct 20, 2018 10:09 am
Estimated value of $2 ticket is about $5, so maybe I'll get three this time.
Are you sure about that? If that's the case, then buy 1 copy of each ticket.
"You can get more with a kind word and a gun than with just a kind word." George Washington

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Re: Where would you go for financial guidance if you win the Megamillions?

Post by kacang » Sun Oct 21, 2018 12:42 am

CULater wrote:
Fri Oct 19, 2018 2:16 pm
So, the odds of winning are about 1/302,000,000 and the pot is about $1 Bil. So expected value is between $3 and $4. So, maybe go for 2 tickets this time. I gotta go get another one.
That is provided that the pot is not split. Given the higher level of interest, it's more likely to have multiple tickets with the same winning number. Thus expected value would be lower. And you'll need to discount taxes as well.

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Re: Where would you go for financial guidance if you win the Megamillions?

Post by archbish99 » Sun Oct 21, 2018 1:04 am

AlphaLess wrote:
Sat Oct 20, 2018 9:01 pm
Are you sure about that? If that's the case, then buy 1 copy of each ticket.
I recall reading that there are companies where that is literally their money-making strategy -- they attempt to purchase all possible numbers and guarantee a win. For example, https://www.nytimes.com/1992/02/25/us/g ... ttery.html. They run into limitations like how much ticket stock stores have on hand and the fact that the machines literally cannot print that many tickets in the time between drawings.
I'm not a financial advisor, I just play one on the Internet.

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Re: Where would you go for financial guidance if you win the Megamillions?

Post by RobLyons » Sun Oct 21, 2018 5:45 am

wolf359 wrote:
Fri Oct 19, 2018 10:02 am
RobLyons wrote:
Thu Oct 18, 2018 7:39 pm
First, this will never happen to any of us. The odds, yadda, yadda..
Plus I never play. Waste of money, creates gambling addictions, its a tax on those that can't do math, the poor etc.
$2 is a cheap price for admission if you consider the entertainment value of daydreaming what would happen if you won. Movie tickets cost more for similar escapism fantasy.


Sure, but we all know it's not just a one time $2 ticket. And I live in the real world =)
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blueman457
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by blueman457 » Sun Oct 21, 2018 8:23 am

RobLyons wrote:
Sun Oct 21, 2018 5:45 am
wolf359 wrote:
Fri Oct 19, 2018 10:02 am
RobLyons wrote:
Thu Oct 18, 2018 7:39 pm
First, this will never happen to any of us. The odds, yadda, yadda..
Plus I never play. Waste of money, creates gambling addictions, its a tax on those that can't do math, the poor etc.
$2 is a cheap price for admission if you consider the entertainment value of daydreaming what would happen if you won. Movie tickets cost more for similar escapism fantasy.


Sure, but we all know it's not just a one time $2 ticket. And I live in the real world =)
[ quote fixed by admin LadyGeek]

For my entertainment value, I got 2 tickets.

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rocket354
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by rocket354 » Sun Oct 21, 2018 10:00 am

kacang wrote:
Sun Oct 21, 2018 12:42 am
CULater wrote:
Fri Oct 19, 2018 2:16 pm
So, the odds of winning are about 1/302,000,000 and the pot is about $1 Bil. So expected value is between $3 and $4. So, maybe go for 2 tickets this time. I gotta go get another one.
That is provided that the pot is not split. Given the higher level of interest, it's more likely to have multiple tickets with the same winning number. Thus expected value would be lower. And you'll need to discount taxes as well.
Exactly. The pot is likely to never be +EV. At $1.6B, the expected lump sum, after-tax payout is (depending, of course, on state) in the $500 million range. The probability of winning is about 1 in 302 million, but it's a $2 (after-tax) ticket, so you'd need a $604 million after-tax payout to have it be +EV. Even if no one wins and it jumps again well past $2B nominal then there would be so many tickets it would likely split anyways--the $1.6B powerball jackpot in 2016 had to be split three ways, for example.

I will buy a few tickets, anyways. There are worse things in life than figuring out what to do with $500 million, or, more likely, spending a few bucks and daydreaming about what to do with it until I somehow miss every single number.

ponyboy
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by ponyboy » Sun Oct 21, 2018 10:10 am

Please...Please...let someone win the mega millions and power ball jackpots on the next drawing. That way we can stop talking about it.

Nicolas
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by Nicolas » Sun Oct 21, 2018 10:21 am

Megamillions is a misnomer. It's really centamillions hectomillions, or now, in this case, kilomillion (singular). Megamillions means trillions. It's not even a trillion pennies. Sorry, just had to get that off my chest.

Edit: replaced centamillions, which is incorrect, with hectomillions, the correct term for hundreds of millions.
Last edited by Nicolas on Sun Oct 21, 2018 4:41 pm, edited 1 time in total.

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Re: Where would you go for financial guidance if you win the Megamillions?

Post by AlphaLess » Sun Oct 21, 2018 12:47 pm

archbish99 wrote:
Sun Oct 21, 2018 1:04 am
AlphaLess wrote:
Sat Oct 20, 2018 9:01 pm
Are you sure about that? If that's the case, then buy 1 copy of each ticket.
I recall reading that there are companies where that is literally their money-making strategy -- they attempt to purchase all possible numbers and guarantee a win. For example, https://www.nytimes.com/1992/02/25/us/g ... ttery.html. They run into limitations like how much ticket stock stores have on hand and the fact that the machines literally cannot print that many tickets in the time between drawings.
And the biggest problem: multiple winners.
If, say, 3 different companies purchased 1 copy of each ticket per company, there will be 3 guaranteed winners, and they won't make money on this thing. Not to mention that there could be additional multiple random-ticket winners.
"You can get more with a kind word and a gun than with just a kind word." George Washington

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Re: Where would you go for financial guidance if you win the Megamillions?

Post by Mr.BB » Sun Oct 21, 2018 12:56 pm

dknightd wrote:
Wed Oct 17, 2018 5:03 pm
I'd see if I could find a way to claim the money and not let my identity be disclosed.
So, once I found I had the winning ticket, I'd be looking for legal advice.
I would not sign the back of the ticket. I'd see if I could set up some kind of legal loophole that would let me stay anonymous.
I assume there are lawyers who have expertise in this area. Hopefully google would find them for me.
not signing the back of the ticket is the worst thing you can do is your proof that you are the owner. You somehow lost it you can't prove it's yours without that signature.
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by Spirit Rider » Sun Oct 21, 2018 1:01 pm

Mega Millions is definitely not a misnomer. The primary definition of Mega is something that is great, huge or a large amount. For example, mega deal, Megastar, Mega Millions, etc...

The science definition is 109 = 1,000,000,000. For example, Megaohms, Megahertz, etc...

The IT definition is 220 = 1,048,576. For example, Megabyte, Megabit. etc...

Mega Millions is a correct usage of Mega when applied to a financial amount.

Freefun
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by Freefun » Sun Oct 21, 2018 1:14 pm

For financial advice I would go,to suze orman.
Remember when you wanted what you currently have?

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Re: Where would you go for financial guidance if you win the Megamillions?

Post by LadyGeek » Sun Oct 21, 2018 1:21 pm

Spirit Rider wrote:
Sun Oct 21, 2018 1:01 pm
The science definition is 109 = 1,000,000,000. For example, Megaohms, Megahertz, etc...
No, it's:

Mega = 106 = 1,000,000
Giga = 109 = 1,000,000,000

See: International System of Units - Wikipedia (Prefixes)
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MathWizard
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by MathWizard » Sun Oct 21, 2018 1:21 pm

Freefun wrote:
Sun Oct 21, 2018 1:14 pm
For financial advice I would go,to suze orman.
Good one. :D

I would go to the "managing a windfall" in the BogleHeads wiki.
Why tell anyone if you already have the info from a great set of people?

Dottie57
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by Dottie57 » Sun Oct 21, 2018 1:24 pm

Any body need the mega millions financial advisor?

Traveler
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by Traveler » Sun Oct 21, 2018 1:30 pm

I'd like to think my life (or at least my mindset) wouldn't change a great deal. Unless there was a security risk, I wouldn't change where I live in my current locale and I also wouldn't buy a new car. I might buy a home overseas. And I would travel first class and stay in nicer hotels than I do now. I'm not sure I'd worry so much about taxes - they are what they are. Sure, I wouldn't want to give the government any more than necessary, but I wouldn't lose sleep over it if I had $300M+. I would quit my job and I'd research and do some philanthropic giving. Probably take care of some relatives and a few friends but that would be it - don't come asking me for more later. And I'd likely continue my general investment strategy.

BTW, I bought $10 in tickets and "won" $6 this weekend. Gearing up to win both Mega Millions and Powerball this week. Haha

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Re: Where would you go for financial guidance if you win the Megamillions?

Post by Spirit Rider » Sun Oct 21, 2018 2:12 pm

LadyGeek wrote:
Sun Oct 21, 2018 1:21 pm
Spirit Rider wrote:
Sun Oct 21, 2018 1:01 pm
The science definition is 109 = 1,000,000,000. For example, Megaohms, Megahertz, etc...
The IT definition is 220 = 1,048,576. For example, Megabyte, Megabit. etc...
No, it's:

Mega = 106 = 1,000,000
Giga = 109 = 1,000,000,000
Yup, you would have thought I would have notice the mistake when it wasn't the same order of magnitude as the IT definition.

KlangFool
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by KlangFool » Sun Oct 21, 2018 2:14 pm

Folks,

Am I correct to assume that I could donate a significant amount to charity and/or donor-advised trust instead of paying taxes?

KlangFool

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JoMoney
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by JoMoney » Sun Oct 21, 2018 2:19 pm

Yes, if you gave the money to a qualified charity, you wouldn't owe taxes on the amount you gave away.
I don't know the terms and conditions of the lottery, but if they allowed for multiple people to claim the same ticket, you could probably give a fractional share to anybody and they (rather than you) would be responsible for the taxes on their share of it.
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vitaflo
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by vitaflo » Sun Oct 21, 2018 2:28 pm

Maya1234 wrote:
Sat Oct 20, 2018 1:14 pm
“This whole idea that one has to be anonymous and disappear like a mob informant in an era when people with enormous wealth are everywhere is rather amusing. “

So true. When I inherited millions the advice here and other places was “Don’t tell anyone” but we were previously always the “poor” ones here with only 2 million. I know so so many people with lots of money. At work many of my bosses are worth 8- 30 million. No one wold think twice or have any overwhelming interest in me catching up on the low end with them. Many people in my town are worth much much more than us.
When you inherited millions your name and face wasn't plastered all over national news about it. It's not the act of receiving a large sum of money that's the problem, it's that everyone everywhere knows you have and exactly how much.

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Re: Where would you go for financial guidance if you win the Megamillions?

Post by Mr.BB » Sun Oct 21, 2018 3:25 pm

Does anyone remember the guy who won 315,000,000 in 2002? No?
Most people don't and if you win this jackpot or hopefully me, no one will remember what you look like or your name after a while; unless your stupid enough to keep putting your name/face out there to remind people.

FYI the winner name was Jack Whittaker
"We are what we repeatedly do. Excellence, then, is not an act, but a habit."

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Re: Where would you go for financial guidance if you win the Megamillions?

Post by dm200 » Sun Oct 21, 2018 3:33 pm

CULater wrote:
Wed Oct 17, 2018 4:03 pm
Just wondering how one should cope with winning a multi-million dollar lottery pot. Where would you go for effective, ethical financial advice about how to handle all that money and not end up in a miserable mess? First of all there's the problem of all the relatives and friends. Second of all there's the problem of all the scumbags coming after you for your money. Third of all, how in the heck would you manage all that money effectively and not be completely overwhelmed? Should you just give it all away? Like to know how people would handle this, just in case I win the $900 Mil on Friday night. :moneybag
Right here :) :sharebeer

I would also put a lot of the money into a DAF - and make some anonymous "grants" to favorite causes.

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Re: Where would you go for financial guidance if you win the Megamillions?

Post by Jazztonight » Sun Oct 21, 2018 3:47 pm

VictoriaF wrote:
Thu Oct 18, 2018 12:16 pm
Don't bother with small change. Skip this Friday and play for 3 commas next week.

Victoria
I took Victoria's advice, since she always seems to know what she's talking about.
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by Rainmaker41 » Sun Oct 21, 2018 4:00 pm

We'd use a top law firm for a trust or other suitable scheme to stay anonymous.

Take the lump sum, then:
- 20% to charities and Donor Advised Fund
- 40% to taxes
- 20% gifted to immediate family
- 20% kept as our portfolio

As for financial guidance, with that kind of money the asset allocation wouldn't have a meaningful impact on the ability to spend enough for a comfortable standard of living; it would only impact numbers on a screen. Better to focus on having meaningful lives and forget about the investments.

I guess use 60% Stock, 30% Bond, 10% Cash/Treasury Bills.

Spend 1% of portfolio per year. Donate another 1% per year. That's probably sustainable forever.
My username is not about money, but is my old online gaming username. I can't say that I make a great deal of money; I just hate spending it. Married the most loving woman in the world October 2017.

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Re: Where would you go for financial guidance if you win the Megamillions?

Post by KlangFool » Sun Oct 21, 2018 4:04 pm

JoMoney wrote:
Sun Oct 21, 2018 2:19 pm
Yes, if you gave the money to a qualified charity, you wouldn't owe taxes on the amount you gave away.
I don't know the terms and conditions of the lottery, but if they allowed for multiple people to claim the same ticket, you could probably give a fractional share to anybody and they (rather than you) would be responsible for the taxes on their share of it.
Thanks.

KlangFool

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Re: Where would you go for financial guidance if you win the Megamillions?

Post by tooluser » Sun Oct 21, 2018 6:01 pm

Shackleton wrote:
Sat Oct 20, 2018 9:27 am
I would hire Klangfool and run every purchase or investment past him just to keep me cognizant of what could happen if the excrement hits the airflow device.
Now that's some Ernest advice!
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Re: Where would you go for financial guidance if you win the Megamillions?

Post by archbish99 » Mon Oct 22, 2018 2:38 am

KlangFool wrote:
Sun Oct 21, 2018 2:14 pm
Am I correct to assume that I could donate a significant amount to charity and/or donor-advised trust instead of paying taxes?
Yes and no. You could reduce the amount you would pay in taxes by giving away a portion of it. Part of why my imaginary plan includes donating 40% of it is that it lowers the actual taxes due below the portion they would withhold anyway (25%), meaning everything that's left is mine to work with. But only part of the reason -- as always, doing something tax-deductible purely for the tax deduction is a losing proposition. Donate because you want to donate, first and foremost.

Second, there's a limit to how much of charitable donation you can claim on a single year's taxes before you instead have a carryover. If you were to donate, say, everything you got after tax withholding ($900M income - $225M tax withholding = $675M) to charity, you'd have an unpleasant surprise: you can't deduct more than $450M; the rest becomes a carryover to future years. Of course, the $59M tax refund would still be plenty to set you up for life and you'd pay taxes on only 50% of your income for the foreseeable future, so that might not be the worst strategy in the world....

As noted, you might be able to dodge some of this by assigning partial ownership of the ticket to a charitable entity instead. It's possible that would be treated as never having been your income, rather than as a donation from you.
I'm not a financial advisor, I just play one on the Internet.

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Re: Where would you go for financial guidance if you win the Megamillions?

Post by KlangFool » Mon Oct 22, 2018 8:08 am

archbish99 wrote:
Mon Oct 22, 2018 2:38 am
KlangFool wrote:
Sun Oct 21, 2018 2:14 pm
Am I correct to assume that I could donate a significant amount to charity and/or donor-advised trust instead of paying taxes?
Yes and no. You could reduce the amount you would pay in taxes by giving away a portion of it. Part of why my imaginary plan includes donating 40% of it is that it lowers the actual taxes due below the portion they would withhold anyway (25%), meaning everything that's left is mine to work with. But only part of the reason -- as always, doing something tax-deductible purely for the tax deduction is a losing proposition. Donate because you want to donate, first and foremost.

Second, there's a limit to how much of charitable donation you can claim on a single year's taxes before you instead have a carryover. If you were to donate, say, everything you got after tax withholding ($900M income - $225M tax withholding = $675M) to charity, you'd have an unpleasant surprise: you can't deduct more than $450M; the rest becomes a carryover to future years. Of course, the $59M tax refund would still be plenty to set you up for life and you'd pay taxes on only 50% of your income for the foreseeable future, so that might not be the worst strategy in the world....

As noted, you might be able to dodge some of this by assigning partial ownership of the ticket to a charitable entity instead. It's possible that would be treated as never having been your income, rather than as a donation from you.
Thanks.

KlangFool

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Re: Where would you go for financial guidance if you win the Megamillions?

Post by wrongfunds » Mon Oct 22, 2018 8:12 am

Here is a question to a typical BH.

Do you think you would stop doing the cost benefit analysis in your head before splurging on yourself after winning a huge windfall? For example, would the internal questioning such as "Would this $80K car give me $80K pleasure?" vanish from your thinking? For personally, I have a feeling that will be still there.

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Re: Where would you go for financial guidance if you win the Megamillions?

Post by alfaspider » Mon Oct 22, 2018 8:32 am

MnD wrote:
Thu Oct 18, 2018 10:27 am
Why all the concern about anonymity? My state is full of rich people especially during ski season and unless they are pop culture or sports celebrities no-one bothers them. And family - I guess every family is different but I had a sibling sell a business for an eye-popping sum and no-one in the family asked him for money that I'm aware of. Seems like the people that get in trouble with lottery winnings do it to themselves and come from a hand to mouth existence. I might put a guy on the front porch for a while and would probably move to a home that had more privacy because that would be enjoyable and not solely because I'm scared of the world.
The difference between celebrities and wealthy business people is that their fortunes accrue over time and those around them have time to adjust to that wealth. Often, people in that situation will migrate into social groups that are similarly wealthy. Plus, although these folks may be known to be wealthy, it's not always clear how wealthy they are.

A lottery winner, by contrast, is immediately thrust into the public spotlight and everyone knows exactly how much money they came into. If you come from a social group where a lot of people struggle with money, you are going to have every friend and distant relative asking for help. It can put huge strains on relationships when that happens. You can easily bankrupt yourself saying yes to everyone, or lose friends and family by saying no. Besides friends and family, you will have all sort of people trying to sell you financial advice or investment "opportunities." Someone who is already well-off winning the lottery likely would have an easier time as they won't have friends and family in need and are already equipped to manage wealth.

As much as it is fun to dream about winning, there are a lot of stories of winning the lottery making someone's life worse. I think my best chance of preventing that from happening would be keeping anonymous, and being extremely judicious about spending the money. The worst thing you could do after winning the lottery would be to move to a great big mansion where you are isolated from your community, family and friends.

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