One lucky Queenslander (not me) has won $70 million in last night’s Powerball draw – the equal largest lottery win in Australian history.

Previously a syndicate of friends from the Gold Coast had shared $70 million in 2013.

It’s not yet known who the lucky person is, with Tatts Lotteries unable to contact the winner so far.

Clearly, winning $70 million would be a life-changing event. Hopefully for this lucky Queenslander, he won’t succumb to the issue many other lottery winners have faced, blowing the lot on holidays, new cars, property and partying with friends – and ending up in a worse situation than if they’d never won the lottery.

Here’s a few things the winner can do with their winnings to ensure the money will last a lifetime and beyond.

Putting the funds into a high-interest account (if you can find one that will allow $70 million) at 3.5% will mean $2.45 million in interest income each year. Tax would be payable at the top marginal tax rate of 45 cents for each dollar over $180,000, leaving roughly $1.37 million after tax – still plenty to sustain a lavish lifestyle. After the 2% Medicare levy and the Temporary Budget Repair Levy of 2% for income over $180,000, you’d have around $1.28 million, with no need to touch the principal amount.

Investing the funds into high yielding dividend shares such as the big four banks Australia and New Zealand Banking Group (ASX: ANZ), Commonwealth Bank of Australia (ASX: CBA), National Australia Bank Ltd (ASX: NAB) and Westpac Banking Corp (ASX: WBC) would earn around 5% in fully franked dividends – although the principal amount would be subject to the ebbs and flows of the sharemarket.

That would result in around $4.15 million in annual income, after franking credits were included on the top tax rate – more than 3 times the income from the savings account – and roughly $345,000 tax-free each month.

Foolish takeaway

The earnings on $70 million invested in income-generating assets would easily provide a substantial annual income for any investor, with no need to dip into the capital amount. The principal amount could even be increased by reinvesting dividends back into sharemarket, further increasing dividends and income.

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Motley Fool writer/analyst Mike King doesn't own shares in any companies mentioned. You can follow Mike on Twitter @TMFKinga

Unless otherwise noted, the author does not have a position in any stocks mentioned by the author in the comments below. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.