Powerball jackpot reaches record $1.6 bln

The Powerball jackpot reached a record prize of $1.6 billion, the third-largest lottery prize in the country’s history. You can thank the Federal Reserve for boosting the reward amount.

The advertised amount of the jackpot is the future value of the prize after being stored in government bonds for 30 years.

Fed Chair Jerome Powell recently hiked rates by 75 bps, which meant higher bond yield, which in turn hiked up the jackpot amount. So, the higher the interest rates, the higher the reward.

There are other factors too behind the soaring amount. As more and more people buy the tickets, the jackpot prize grows. Another factor adding to the lottery amount is the lack of winners for 39 consecutive draws, hiking up the final lottery amount.

The next draw is today, and the odds of winning the lottery are one in 292 million.

The winner can choose to either receive the prize amount annually over 30 years or take the lump sum payout—in which case the person would get 34%.