Powerball Jackpot
Powerball tickets are shown in San Lorenzo, Calif. No ticket matched all six Powerball numbers following the drawing for a record jackpot of nearly $950 million, lottery officials said early Sunday, Jan. 10, boosting the expected payout for the next drawing to a whopping $1.3 billion. (AP Photo/Marcio Jose Sanchez)
There is one way to guarantee you'll win the Powerball jackpot: buy all of the combinations.
With five balls ranging from 1 to 69 and the Powerball ranging from 1 to 26, that's a lot of possible outcomes. It would cost a whopping $584 million to buy one ticket for each of the roughly 292 million combinations.
But the jackpot is so enormous you'll still come out ahead, right? Not exactly. The $1.3 billion jackpot is worth only $806 million if you want the money right away. Then 39.6 percent of your winnings will go to federal taxes, leaving just $486 million -- still $98 million short of what you spent to guarantee the winning ticket. You'll get some money in smaller prizes for matching two, three, four and five of the winning numbers, but you still won't come out ahead.
One upside is that Pennsylvania exempts lottery winnings from income taxes as long as the ticket was bought within the state.
If you instead opt for the annuity, you'll get the entire jackpot over a 30-year span. You will, however, still have to deal with taxes. There's also the problem of slowly paying off that $584 million you spent. Let's just say most Americans can't afford such a strategy.
And don't forget that even if you buy a ticket for every combination, someone else could also have the same numbers and you'd have to split the jackpot.
For everyone who doesn't have hundreds of millions to spend, listen to the advice of lottery expert Richard Lustig: set a budget and pick your own numbers.
