What is an annuity prize?
An annuity is a sum of money payable annually or at regular intervals. Powerball and Megabucks have top prizes that provide an annually annuity option. The Lottery uses the money in the prize pool to purchase zero-coupon bonds. Each of the bonds matures annually so the winner receives a check each year. By buying bonds the Lottery can offer larger prizes than a single, lump sum cash payment. The jackpot prize is paid in 25 annual installments for Megabucks and 30 annual installments for Powerball. The estimated jackpot is the approximate value of the 25 or 30-year annuity prize.
Related Questions
- In the event that an annuity jackpot winner passes away before collecting an entire jackpot prize, what happens to the remaining prize money?
- If someone chooses the annuity prize and passes away prior to the 20-year minimum, what happens to the prize?
- Can PAYDAY Top Prize winners receive a single cash payment, rather than the annuity?
