Top YouTuber MrBeast recently handed out a $5 million prize to the winner of "Beast Games" season 2. While many people would dream of winning $5 million, MrBeast has the internet divided on a question about a big lump sum upfront or steady monthly income for life.
MrBeast Divides the Internet
With 469 million subscribers on YouTube, MrBeast often entertains people around the world and provides life lessons, entertainment and shows how far some people will go to win money and challenges.
On the same day that the 10th and final episode of a second season of "Beast Games" aired on streaming platform Prime Video from Amazon.com Inc (NASDAQ:AMZN), MrBeast took to social media to ask an intriguing question.
"If you won Beast Games, would you rather take $5,000,000 upfront or $50,000 a month for life?" MrBeast, who is also known as Jimmy Donaldson, asked.
The question divided the internet and went viral with 10.9 million views on the tweet.
Unlike a straight up question of would you rather take something now or split the amount evenly over a time period, the question becomes more of a dilemma of wanting immediate cash now and securing financial freedom or betting on living more years and being smart with steady monthly income over time.
Here's the math.
Taking $50,000 a month equals $600,000 annually. It would take 8.33 years to equal the $5 million payout, which means as long as you live 8.33 more years from now, you would make more money by taking the monthly payments.
Factors to consider include how long you may live and also the rate of return you could get if you took the $5 million now. Some people on social media believed they could invest the $5 million or put it to work to earn a higher monthly rate of return.
This author polled followers on social media to see which answer ranked ahead:
"MrBeast Question on Beast Games as a poll: Would you rather take $5 million upfront or $50,000 a month for life if you won Beast Games 2?" I asked.
The results from 43 votes were:
- $5 million upfront: 34.9%
- $50,000 a month for life: 65.1%
The winner was the monthly income, but based on the fact that you could outearn the $5 million in 8.33 years, the close results of the poll may come as a surprise.
Ultimately, it comes down to life expectancy, rate of return and financial goals. The average life expectancies are 78.4 to 79 in the United States and around 73 years globally. This means that if you are 70 or under in the U.S. and 64 years and 8 months old or younger globally, you are more than likely to make more than the $5 million by taking monthly payments.
Another factor to consider could be if the person asked the questions has kids as $5 million upfront now could secure their financial future with college money or money put aside, while the monthly payments could stop if the parent died tomorrow.
Financial hardships or needing money immediately for medical bills, debt, or to care for a loved one could also factor into being more likely to take the $5 million now.
Social Media Responds
The question divided social media and generated plenty of thoughtful responses. Here are some of the most viewed:
- @willreil: I would take $50,000 a month. That's $600k a year, which is 12% of $5m that you can the reinvest at market rates. In year 8 you will have $5m and still be earning $50k a month plus the interest you earn on your money. $50k a month is better than $5,000,000 at all points.
- @miragemunny: $5,000,000 up-front, because i must account for any possible misfortunes or financial inconveniences on the part of the "Mr. Beast" company that would prevent or delay me from receiving my monthly $50,000 checks over the course of my life, which i intend to be long!
- @danielRPK: Simple math: if you take the $5M upfront and split it into $50K per month it'll last about 8 years. But if you choose $50K a month for life you'll likely end up with much more assuming you live longer than 8 years. So yeah – $50K a month is my answer. Now… can I get some?
- @digvija73188705: Taking the lump sum gives immediate freedom to invest or spend while the monthly payout ensures steady security for life. The choice depends on whether you value long term stability or the flexibility of having all the money at once.
MrBeast's Question Vs. Lottery Jackpots
MrBeast's question could look similar to the decision many people will never have to decide, which is if you win a lottery jackpot, do you take the lump sum or the monthly payouts over time.
For a recent Powerball jackpot that was at $1.8 billion, the lump sum cash payout total was only $826.4 million. While this is a life changing amount, it is also significantly less than the $1.8 billion.
Those taking the lump sum for lottery jackpots lose a significant part of future earnings with a lower upfront payout.
Taking the annual payments grants 30 payments over 29 years with one payment up front and the additional payments made each year that are 5% higher to fight off inflation.
The lottery example is different than MrBeast's question as his payout doesn't cap the monthly payments and instead makes them for life, allowing them to pass the lump sum upfront payout.
Image created using artificial intelligence via Gemini.
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