Everything You Need to Know about Powerball

Powerball’s jackpot will hit $1.5 billion on Wednesday night and could rise even higher to reflect the huge demand for tickets for this record-breaking draw. The prospect of becoming the world’s biggest-ever lottery winner is proving hugely tempting for fans in the US and around the world, and if you want to get involved too but need to know more about how it all works, here are some answers to your Powerball questions!

Everything You Need to Know about Powerball

Is the full $1.4 billion Powerball jackpot paid to the winner?

If just one person matches all the balls drawn in Wednesday’s Powerball draw, they will have the option to take an annuity or accept a cash lump sum. The annuity consists of 30 payments over 29 years, totalling the full $1.4 billion, although each instalment will be taxed as is it deemed by US authorities to constitute earnings.

The cash prize is lower, currently standing at $868 million, and will also be taxed, but you will receive the entire post-tax sum straight away in one payment.

Which is better, cash or annuity?

The choice of whether to take your Powerball prize as an annuity or in cash will depend on your circumstances, including your age and how well you think you could handle a sudden massive injection of cash into your bank account.

An annuity is a guaranteed revenue stream over 29 years, which allows financial security, but some players prefer to be able to buy that sports car, mansion and private island outright, rather than having to wait or taking out credit. You might also think you could invest the cash to offer a bigger return than the full annuity amount, although that strategy comes with a good deal of risk.

Older players might understandably not want to receive the jackpot in an annuity, but it is worth knowing that any remaining payments can be passed on in your will and even cashed out and divided with the rest of your estate.

It is best to consult a financial expert on these matters during the 60 days you are allowed after claiming to make up your mind. They can also advise you on the tax implications of both options.  

What are the benefits of Quick Picks versus choosing your own lottery numbers?

Between 70 and 80 percent of Powerball lines are computer picks, producing a similar percentage of winners, which suggests you have an even chance however you play. However, Quick Picks help you avoid falling into habits like choosing numbers based on birthdays or other special occasions, which will exclude you from winning the jackpot if any number over 31 is drawn.

Can players outside of the US win Powerball?

As long as your ticket was purchased in a participating US state, you can win the Powerball jackpot. You could be visiting, have relatives in the States buy the tickets for you or use an online lottery concierge service to purchase entries on your behalf and you would be eligible to pick up the prize.

You can choose between an annuity or cash payments and you would be taxed as a non-resident alien on the amount you claim.

Are the odds of winning better when the jackpot is lower?

Powerball is a lottery rather than a raffle, so the odds of winning the jackpot remain constant, no matter how high it rises or how many other players take part. You will always have a 1 in 292.2 million chance of claiming the top prize.

Powerball tickets are on sale at authorised retailers across the US and from online concierge services, so make sure you get hold of them before the queues really start to build up ahead of Wednesday night’s $1.5 billion Powerball jackpot draw.

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Article Last Modified: Friday, 14 October 2016 11:25:48+00:00
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