Everyday people dream of winning the lottery and having the financial freedom to pursue the important things life has to offer. Of course, for the lucky few that do win such financial windfalls are also accompanied by a  lesson in the time value of money. For example, many winners choose to receive their payments in a long-term payout over a period of 20-25 years. These long-term payouts are typically rolled into an annuity. 

If the winner were to take into account the rising cost of living, and the often hefty withholding taxes which have been steadily increased over the years in some states; all of which could substantially diminish the payout. Many individuals may decide that investing the lump sum payout now might be more beneficial to them in the long run. In fact, it's actually possible that a lump sum payout invested wisely today could eventually eclipse  the original amount of the winnings by the end of the original 25 year payout period!