When the Mega Millions is up to a potential $750M and the PowerBall is up to $550M, it’s time to put a couple chips down on the table and pull up a chair to play at least one hand.
For the $750M prize, our take home after all taxes would be $308M. Phew. That’s a nice chunk of change. So where would I/we put it?
- 10% to tithe ($31M)
- 10% to charities ($31M
That takes us to $246M. Then it’s time to take care of family.
- $15M trust funds for our kids, payable in three increments every 7 years beginning at age 25. ($30M)
- $15K tax-free gifts to various family members and close friends. For those that don’t recall, tax-free gifts are given person to person, so in this instance, if we want to give a gift to Denis’ sister, he’d give $15K, I’d give $15K. Then to her husband, Denis would give $15K and I would give $15K. So really, they would be getting $60K TAX-FREE. But we could do the same for their sons as well. And my sister and her family. And my parents. And other family members and friends. Denis would give $15K and I’d give $15K, which means every person would get $30K tax-free. And we can do that every year going forward until we’ve reached $10M, which is the current limit for lifetime gifting (although I’ve read this may get adjusted to a lower amount under the Biden administration).
- But not only that, separate from those gifts we would be allowed to make unlimited direct payments for medical and tuition expenses for family members.
We’ll assume those three line items total $46M. We still have $200M!
It was funny this morning when Denis and I were talking about the lottery, and what we’d do if we won. He said, “We’d pay off the mortgage!” and I thought, “I’m not staying in this house if I have hundreds of millions of dollars at my disposal!” There are some GORGEOUS homes in our area that are between $1-3M with acreage for privacy. And I’ve always loved the idea of buying a cabin on The World, which is the luxury cruise ship that sails all around the world every year and you can hop on and off at your leisure in the various ports of call. And all of us would have a serious upgrade in vehicles. So let’s set aside $10M which is more than enough.
That leaves $190M. That gets invested. Assuming a withdrawal of just 2% each year, our annual “salary” becomes ~$3.8M. With that we could do so much – continuing to help charities, to help family and friends, and live a pretty more-than-comfortable life.
I’m in!!
