Whats the difference between the Cash Option and the Annuity Prize?
The winner receives the cash value of the jackpot pool in today’s dollars under the cash option, and would receive that same jackpot pool’s worth over a 25 year period for Megabucks or a 30 year period for Powerball under the annuity option. However when that pool of money is invested today, it grows to the advertised amount in 25 or 30 years, paying the winner a check each year. It is very similar to how a savings bond works. A $100 savings bond costs the purchaser only $50 today. However, if the holder of the bond waits until maturity, the bond is then worth the entire $100. *Note: A new winner has 60 days after presenting the winning ticket to decide on cash or annuity, after 60 days have passed, if no decision has been made, it automatically becomes an annuity.
