How big of a lottery win do you need to quit your job?

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 life 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 GIC rates will yield close to one per cent, while you may be able to earn 4 to 5% a year by taking some risk in a conservative portfolio.

“The longer the time horizon for needing the income, the greater the pool of money you’re going to need at the beginning to make sure that money lasts,” he said.

A 5% return means that for every $1 million in lottery winnings, you could generate about $50,000 in annual income before any fees and taxes. Put another way, a 5% annual return on $5 million could generate about $250,000 a year.

However, many forms of investment income are taxed at a lower rate than money earned by working, so compared with your salary, you may not need to make quite as much from your investments to have the same amount in your pocket after taxes.

Del Greco also cautioned inflation can erode the value of your nest egg without at least some investment growth.

“That’s why we encourage a balanced portfolio that would incorporate high-quality, dividend-paying stocks, because dividends are taxed at a lower tax rate, and also blue-chip equity stocks provide a natural hedge to inflation pressures,” she said.

If you do hit the jackpot, both Del Greco and Moser recommend putting the money aside for a time before doing anything with it to give yourself time to formulate a plan once the initial thrill of the win passes.

“Before you make any rash decisions, before you start spending any money, before you start giving away all the money, you really want to sit down and figure out what the purpose of this money is,” Moser said.

In your dreams, at least.