LEE COUNTY, Fla. -- Experts are advising what people should do to make a $1.6 billion dollar jackpot last, Tuesday.
The Mega Millions lottery jackpot has soared to $1.6 billion. 4 In Your Corner reached out to Dr. Victor Claar, economics professor at Florida Gulf Coast University to find out how to make that money last.
When it comes to taking the lump-sum versus annual payments, Dr. Claar suggests taking the time to determine whether you're responsible with investments. If you think politically taxes will be lower in the future, it might be worth it to take an annual payment. However, if you're a savvy investor, you may have better luck taking the lump-sum. "If you can get a rate of return with the lump-sum, lets say 6 percent or so, you're absolutely better off taking that money as a lump-sum because you can do better than the market," he said.
According to Dr. Claar, it is also a good idea to diversify your money to cut down on risk. The Federal Deposit Insurance Corporation can only insure about a quarter million, which isn't much when you're looking at a jackpot in the billions. "Another risk is bank failure," he said. "If you park your money in one bank, or in a couple of banks, your deposits are insured, but not fully insured."
However, Dr. Claar's last bit of advice has more to do with remaining humble. "Don't let money change the sort of person you are," he said.
Tuesday's Mega Millions drawing will air at 11 P.M. Eastern time on Fox 4.