CNBC make it 2024-03-26 02:00:50


Mega Millions jackpot is up to $1.1 billion—what billionaire Mark Cuban says to do if you win

For the sixth time in Mega Millions lottery history, the jackpot prize is worth over $1 billion ahead of Tuesday night’s 11 p.m. ET draw.

If you match all six numbers on your ticket, you’ll have the choice between $1.1 billion paid out as an annuity over 30 years or taking home a lump sum payment of $525.8 million, per usamega.com.

Most winners choose the lump sum option, even though it’s less than half of the total jackpot amount.

That way, they get the most money possible right after winning, rather than receiving annual payments. In this case, those payments would be roughly $23 million a year after federal taxes are deducted. With the lump sum payout, winners are theoretically able to invest and start growing the funds right away.

However, Mark Cuban, self-made billionaire and star of ABC’s “Shark Tank,” thinks winners should take the annuity instead. Here’s why.

Why Mark Cuban says jackpot winners should take the annuity

Cuban advises winners not to take the lump sum, largely because there are no guarantees that they will invest it properly.

“Don’t take the lump sum,” Cuban told the Dallas Morning News in 2016. “You don’t want to blow it all in one spot.”

Instead, by taking the annuity payout, you are guaranteed to receive the highest take-home winnings possible. The payments will also be doled out every year, making it impossible to misspend all of the jackpot right away.

To take home as much with the lump sum option, you’d need to make up the nearly half-billion dollar difference in through shrewd investments. But not everyone is good at investing.

“You don’t become a smart investor when you win the lottery,” says Cuban. “Don’t make investments. You can put it in the bank and live comfortably. Forever.”

If you stash your winnings in the bank, you probably won’t get the highest possible return compared with riskier investments. But in doing so, you’ll “sleep a lot better knowing you won’t lose money,” he says.

“If you were happy yesterday, you are going to be a lot happier tomorrow,” Cuban told the Dallas Morning News. “Life gets easier when you don’t have to worry about the bills.”

Cuban also offered this advice to jackpot winners: “Hire a tax attorney first,” before you claim the money. They will help you figure out a plan to ensure that you make the most of your annuity.

Disclosure: CNBC owns the exclusive off-network cable rights to “Shark Tank.”

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34-year-old making $49,000/mo in passive income: What I tell people who want successful side hustles

In 2016, I was working two jobs as a senior web developer and an adjunct professor. On the side, to help me get by, I was a freelance web developer. I knew almost nothing about business.

Today, I’ve built more than 10 passive income streams, including multiple e-commerce brands, a YouTube channel and an online school. Combined, these businesses bring in about $49,000 a month in passive income. I’ve learned a lot about how to create a profitable company.

I always tell people that if they want to build successful side hustles and passive income streams, they need to stop believing these three myths:

Myth #1: You need to spend money to make money

This is a common piece of business advice. If you want to open a retail store, for example, your expenses would include monthly rent, purchasing goods — to stock shelves and then re-sell to customers — and employee wages. That’s a traditional way of doing things, and an expensive one.

My favorite online business model is print-on-demand. I started my print-on-demand side hustle on Amazon in 2017 for $0 and I’ve since expanded it to offer my products through Etsy, Walmart, and eBay.

DON’T MISS: The ultimate guide to earning passive income online

Print-on-demand lets me sell items like t-shirts and coffee mugs with custom designs on them. I don’t pay a dime for any of the inventory until after a customer places an order, which helps me keep costs low. 

After I get an order, I pay a company like Printful, which specializes in printing and shipping products to fulfill the orders for me. After paying the printer, and marketplace referral fees for Amazon and Etsy, then I have a profit left over. 

Myth #2: You can make passive income without putting in the work

Outside of dividend investing, building passive income streams will always require time and dedication. There is no shortcut to success. I worked many early mornings and late nights on my side hustles, especially early on.

While I am still very involved in the day-to-day management of my businesses, I know many people who have been able to step away from day-to-day operations — after they hit an income threshold they were happy with — while continuing to benefit from their previous work. 

Building my profitable passive income streams required a lot of discipline. I had to learn to be okay with the idea of delayed gratification. But in the end I’m so glad I put in the effort. 

Myth #3: You need a team to help run your business

I’m not against having a team, but in my experience, it’s not necessary to have one to be successful. Seven years in, I’m still able to do this on my own, thanks in part to how many different tools are available for entrepreneurs right now. 

For example, for the first two years I ran it, I spent three to four hours every day on my Amazon Merch business in order to help it grow. Today, thanks to advances in automation, I only work one hour per week on it.

I’m a big fan of tools like MyDesigns. It uses AI to automate design creation, generate SEO-friendly product listings and publish my products in bulk online. All of this makes it possible for me to come up with and offer more new custom items, and it’s cut the most tedious work out of the equation. 

Being strategic with these tools have helped me stay on top of everything, while also letting me leave work behind whenever I want or need to. That way I can truly live the life I want.

Ryan Hogue is a former web developer and adjunct professor who quit both jobs to run his e-commerce business. His YouTube channel teaches people how to earn passive income using “Ryan’s Method.”

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Trader Joe’s has raised the price of its famous 19-cent bananas for the first time in over 20 years

One of Trader Joe’s most popular products has just gotten its first-ever price increase.

The popular grocery store chain recently raised the price of its individually-sold bananas by roughly 20%, to 23 cents from 19 cents.

Trader Joe’s bananas have cost 19 cents apiece since the chain first started selling them individually back in 2001. The never-changing price tag became a selling point for the fruit, with signage at some Trader Joe’s locations boasting about the store’s refusal to increase the cost of potassium-rich produce.

The 19-cent bananas have proved so popular over the years that they recently made the Trader Joe’s Product Hall of Fame.

In a statement to CNBC Make It, a representative for the brand said that the new price “still represents a tremendous everyday value for bananas.”

“We only change our prices when our costs change, and after holding our price for bananas at 19¢ each for more than two decades, we’ve now reached a point where this change is necessary,” they said.

The spokesperson noted that although banana prices were going up, the price of other produce items such as romaine hearts, bell peppers and green onions have all gone down.

Trader Joe’s didn’t always sell its bananas individually. The grocer used to sell them by the pound like other retailers, but because its stores don’t have scales, the bananas were weighed and packaged in its warehouse.

In the first-ever episode of the “Inside Trader Joe’s” podcast, then-CEO Dan Bane said that changed when he noticed an elderly woman browsing the bananas but not buying any. Bane approached her and asked why she didn’t take a bag of them.

“She said to me ‘Sonny, I may not live to that fourth banana,’” he said on the 2018 episode. “And so we decided the next day we were going to sell individual bananas. And they’ve been 19 cents ever since.”

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The best- and worst-paying college majors, 5 years after graduation

If you want to make the most money possible right after college, study to be an engineer.

As a major, it’s the safest bet in terms of earning power. Engineering degrees occupy nine of the top 16 college majors with the highest incomes five years after graduation, a recent New York Federal Reserve study reveals. 

Computer engineering majors ranked first with an annual median salary of $80,000, followed by chemical engineering and computer science — the only two other majors that earn more than $75,000 annually.

They make roughly double that of the lowest-paid majors, which tend to be degrees in the liberal arts or humanities.

Here are the 16 highest-paying college majors, five years after graduation:

The technical knowledge, mathematical proficiency and problem-solving abilities required in engineering are valuable across many industries. As such, the profession tends to have higher salaries compared with other occupations.

In contrast, students who major in liberal arts, performing arts and theology earn the lowest salaries within five years of graduating from college, according to the study of full-time workers.

Graduates of all three majors earned a median annual income of $38,000, the lowest out of the 75 majors in the study. Other low-paying majors include leisure and hospitality, history, fine arts and psychology, all of which garnered median salaries of $40,000 or less per year.

For context, that’s slightly less than the U.S. personal income median of $40,480 as of 2022, per the latest data available from the U.S. Census.

Here’s a look at the 16 lowest-paying majors, five years after graduation:

With liberal arts degrees, graduates tend to be paid less overall for various reasons. For one, their skills may not be directly related to generating revenue, even if their vocation is a benefit to society.

Or, it can be a case of too few well-paying jobs compared with the number of graduates each year, as is the case for fine arts degrees. As such, the lack of demand can drive down wages.

Education majors tend to be paid less as well. While teachers have good job security, summers off and pensions, they’re usually paid by state governments, which have lagged in keeping wages commensurate with inflation. In recent years, the “teacher pay penalty” has gotten worse, according to the Economic Policy Institute.

Data for this annual study was compiled from U.S. Census data from 2022, the most recent available. The study excludes students currently enrolled in school and is limited to a working population of those ages 25 to 65, with a bachelor’s degree or higher.

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I spent 5 years interviewing 233 millionaires—here are 5 things they never waste money on

I spent five years studying 233 millionaires to learn about their habits and the way they think.

They came from different backgrounds and experiences, but all had at least $160,000 in annual gross income and $3.2 million in net assets.

I was particularly interested in what they spend their money on. But almost everyone told me that what contributed more to their wealth was that they stopped wasting money on certain things:

1. Processed and packaged food

To prioritize their health, they stopped buying low-quality, processed food and instead opted for organic or wholesome foods that did not have preservatives. 

They often sought out products that could be sourced to their place of origin, and frequented farmers’ markets and grocery stories that were known for high quality produce and meat.

2. Cheaply made products 

They refused to drop money on the latest fashion trends, or inexpensive and poorly constructed furniture. Instead, many preferred to invest in timeless quality pieces for their wardrobe and home that were built to last.

Often, the cost was two to three times more than the low quality clothing and furniture. But they were comfortable making bigger purchases, because it would still be less expensive than constantly replacing cheap craftsmanship.

3. Major home or car repairs

In the same vein, many of the millionaires told me that given the option, they preferred to spend money on completely replacing things like old roofs, washing machines, dishwashers, refrigerators, furnaces, and even vehicles, rather than putting their hard-earned funds towards expensive repairs. 

While this was often more costly, they rationalized that something new would last far longer than something repaired, which gave them priceless peace of mind. 

4. Outdoor tools and equipment 

While some still enjoyed doing outdoor work, like mowing their lawn, weeding, landscaping and trimming, the vast majority — once they got wealthy — hired landscapers to take care of all outdoor upkeep. 

This meant they no longer spent money repairing or replacing old equipment. Many gave their tools away to family and friends. 

What they were buying was time. Since they no longer needed to carve out an hour of two every week or month to maintain their property, it gave them more time to rest, relax or engage in recreational activities. 

5. Lottery tickets 

Many of the millionaires eschewed gambling as they were building their wealth, and that common sense extended into their new financial lives.

They shared that after they got rich, they refused to spend money on lottery tickets, and would encourage their employees, family and friends to do the same.

Since the likelihood of winning any lottery is slim, they saw it as a waste of money. Instead, it was better to put those funds towards memorable experiences.

Tom Corley is an accountant, financial planner and author of “Rich Kids: How to Raise Our Children to Be Happy and Successful in Life”, “Effort-Less Wealth”, “Change Your Habits Change Your Life”, “Rich Habits Poor Habits” and “Rich Habits: The Daily Success Habits of Wealthy Individuals.”

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