A 20-year-old Canadian woman recently lit up social media after she won the lottery and (gasp!) chose to accept her winnings in an annuity rather than a lump sum.
Instead of taking a tax-free (Canadian lottery winners aren't taxed like U.S. jackpots) lump sum of $1 million, Brenda Aubin-Vega, of Quebec, chose to receive $1,000 weekly for life. Her decision contrasts with what the vast majority of lottery winners choose and drew criticism. Everyone seemed to have an opinion, even Binance founder Changpeng Zhao.
The fierce debate highlights, once again, the age-old question of whether lottery winners should take the lump sum or an annuity and how even to make that decision.
“The reason most take the lump sum is because if you take the annuity and get hit by a bus, they feel like it’s over,” said Dan White, founder and CEO of Daniel A. White & Associates in Glen Mills, Penn.
Before deciding how to receive your prize, winners should understand what the two options are.
