Big dreams as Powerball jackpot hits $320 million
Tim Boyle/Getty Images
(CBS News) One person in America could be $320 million richer Wednesday night.
That's when the Powerball drawing will be held in 42 states as well as the District of Columbia and the Virgin Islands, with a jackpot worth an estimated $320 million.
CBS Station WCBS New York notes no one has won the top prize since June. This current jackpot is reported to be the fourth biggest in Powerball's 20-year history. In order to win the game, the five white balls and the red Powerball drawn have to match. The odds of winning the entire jackpot is 1 in 175 million, according to the Powerball Web site.
This past April, 81-year-old Louise White of Newport, Rhode Island won a Powerball jackpot worth $336 million. And in June, workers from Quaker Oats won a $241 million Powerball prize.
Video: Powerball jackpot up to $320M
What do some Powerball players hope to do with their winnings if they hit the jackpot?
"I'd hire a chauffeur to drive me around so I don't have to walk," said Henry Lewandowski, of Clifton, N.J.
"I'd buy a house and pay my daughter's college off," said another person from the Tri-State area.
In Philadelphia, newsstand owner Steve Ricchini bought some tickets for himself and said he would retire if he won.
"What would I do? I would not be up at 4 o'clock in the morning, I can tell you that. Unless I was still awake from the previous night," he said, as reported by CBS affiliate KYW Philadekphia. He gets also gets a bonus if the winning ticket is purchased from his newsstand.
Meanwhile, CBS Station WBBM Chicago reported that while sales via lottery machines in Illinois have been brisk, online sales have not met expectations.
"We still do $60-70,000 a week in sales over the Internet but, our research suggested that between 600,000 and a million people would begin playing the lottery when the prize was $100 million or more," said Michael Jones, director of the Illinois Lottery.
Although the price of a Powerball ticket went up to $2 as of this January, Minnesota State Lottery's John Mellen thinks the increase is beneficial for the lotteries and the players.
"Because the jackpot now starts and $40 million but it grows faster and it grows bigger," Mellein said, as reported by CBS affiliate WCCO Minneapolis. "And that's what players have said they wanted in this game."
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I dont want anything else
You can also apply a discount for present value of the jackpot. If the nominal jackpot is $320 million as they expect, the lump sum value will be about 72% of that, or $253 million. Take out Federal taxes and it is down to $189 million. (you may or may not have to pay state taxes on lottery winnings as well)
Given that may have to split the winnings with others, that takes the expected value of a winning ticket after federal tax down to $101 million. This gives an expected jackpot value of $101M/175M = $0.58
Now, you can also win some other prizes which are worth about 18.2 cents per ticket making the $2.00 ticket worth $0.78 of game equity and $1.22 worth of tax. But your taxes do a lot to help schools and whatnot, so thank you for playing.
The amonts in payouts now are ridiculous.
It is almost even odds, if you figure the final jackpot will grow to $350 Mil.
Not even close. Blackjack is almost even odds where the house has an edge between 0.5% and 1% per hand. The house has about a 50% edge at this level.