Newspaper article The Canadian Press

How Big Does the Lottery Jackpot Need to Be to Let You Quit Your Job?

Newspaper article The Canadian Press

How Big Does the Lottery Jackpot Need to Be to Let You Quit Your Job?

Article excerpt

How much do you need to win to quit your job?

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OTTAWA - Hoping to fund your retirement by winning the lottery is a ridiculous idea.

Sure, someone has to win, but banking your future well-being on a cheap ticket, a handful of carefully chosen numbers and near-impossible odds isn't financial planning -- it's wishful thinking.

But if you're fond of daydreaming about winning the big jackpot -- Friday's Lottomax jackpot is $38 million, after all -- how much would you actually need to win to quit your job for good?

That depends on an array of factors, including how you plan to live your live going forward, how old you are and what kind of financial legacy you want to leave, says investment adviser Kathryn Del Greco at TD Wealth.

While some may be happy to putter in their gardens, others may have a bucket list that includes playing the great golf courses of the world and indulging their love of rare wines and fine dining.

"There isn't a magic number that you could apply to everyone," Del Greco said.

As you begin your fantasy session, keep in mind that lottery winnings aren't taxed in Canada, so the amount on the oversized novelty cheque you'll be handed in your dreams will be the very same sum you'll deposit in the bank.

But once that money starts earning interest and investment income, those amounts will be taxed.

Larry Moser of BMO InvestorLine estimates a risk-free portfolio of GICs will yield close to one per cent, while you may be able to earn four to five per cent a year by taking some risk in a conservative portfolio. …

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