The curse of the lottery: 11 reasons why winning a jackpot could be a disaster
On January 29, the Powerball jackpot was over $ 396 million, and someone won that amount. That kind of money can change your life, but not necessarily for the better. Several jackpot winners fell victim to the "curse of the lottery" and some ended up bankrupt, divorced - or even died, writes GOBankingRates.
“This is such a big shock that they are not ready for it,” said Don McNay, financial advisor to the lottery winners. "This is the curse of the lottery because winning made their lives worse, not better."
If you still haven't won the Powerball jackpot, this “bad luck” can be a hidden gift from fate.
Money doesn't make you happy - and it does
If you have 99 problems, winning the lottery will solve only one. Although it would be nice to never worry, knowing that your debit card has enough money for big purchases, there may be other things in your life that cannot be helped by money.
A study published by the National Bureau of Economic Research in 2018 on the long-term effects of winning a lottery showed that winning does not have a significant impact on people's everyday happiness.
“We have not found convincing evidence that lottery winners will be happier in the long run,” said Daniel Cesarini, Ph.D., professor at the university, and co-author of the study.
You will not be left behind asking for help
Many lottery winners are stunned by how many people ask them for financial assistance, some end up giving out too much.
Sharon Tirabashi won the jackpot in Canada for $ 10,5 million and spent almost the entire amount in just 9 years: a woman distributed her income to her family and needy friends. She gave her parents $ 1 million and another $ 1,75 million to brothers and sisters. She also paid rent to others and gave loans to friends in need of finance or to those who wanted to start a business. Some people, having received money, disappeared from her life.
“Money is the root of all evil,” said Chirabashi.
You might spend it all and break
Although the number of lottery winners who eventually went bankrupt may be overstated, it is still possible.
This happened to David Edwards, who was one of two Powerball winners in 2001 and won a jackpot of $ 295 million. He spent his money frivolously buying things like a new home in a closed community, private flights, cars worth more than a million dollars, a watch for $ 78, a ring for $ 000, and a plasma TV for $ 59. A number of poor business decisions and serious cost overruns led Edwards to go bankrupt and end up living in a cell garage.
Managing that amount can be full-time work
You will need help managing your winnings - and you will have to find someone you can trust. Unfortunately, not all financial advisors have the ability to manage such large amounts. This was the case with Powerball winner Gloria Mackenzie, who won $ 590 million. She sued her son for hiring a financial consultant who, she claims, mismanaged her funds. Her lawsuit, which was pending as of April 2019, alleges that she suffered more than $ 10 million in damages.
“Money was earning between 0,02% and 0,08%,” said Mackenzie lawyer Greg Anderson. "Then they took $ 2 million from Gloria in additional fees."
Anderson cautions against trusting random people on this subject.
"Your friend who is a specialist in exchange transactions can give good advice, but what financial responsibility will he incur in case of a mistake?" Anderson said.
Your children and family members may suffer
The stories of children who grew up in wealth and had serious problems because of this are not uncommon.
When Jack Whittaker won the $ 2002 million Powerball jackpot in 315, he shared his win with his granddaughter Brandy Bragg, which eventually led to her addiction.
“She doesn't want to be responsible for money; she doesn't want to inherit money; she's just looking for the next dose, ”Whittaker said. “She said," All I care about is drugs. " It broke my heart. "
In 2004, Bragg was found dead, her body was wrapped in plastic film.
“My granddaughter died because of money,” Whittaker said.
Not all your friends will be sincere
While true friends will welcome your luck, there may be those who are jealous or angry. And you never know who will try to take advantage of you.
Lottery winner Sandra Hayes, who in 2006 split the Powerball win by $ 224 million with a dozen colleagues, said her unexpected win turned some friends into enemies.
“I had to endure the greed of people who tried to get me to give them money. It caused severe emotional pain, ”Hayes admitted. "These are the people you loved at heart, and they turn into vampires trying to suck the life out of you."
Winning is taxed heavily
The jackpot cash amount on January 29 was $ 274,6 million, which creates a federal income tax of about $ 102 million, assuming that the winner is taxed at a rate of 37%, according to the Powerball.net tax calculator.
"Taxes have a big impact on winning," said Dan Root, CFP and Oklahoma City-based wealth advisor. "If you win, just be aware of how large the tax bill can be and make sure you are prepared to handle it."
Winners cannot always remain anonymous
Only six states - Delaware, Kansas, Maryland, North Dakota, Ohio and South Carolina - allow lottery winners to remain anonymous. In the rest, the names of the winners are made public, leaving them vulnerable to the claims of greedy strangers.
One vivid example of this is the case of Abraham Shakespeare, who won a $ 31 million lottery in Florida in November 2006. After the victory, a woman named Doris "Dee Dee" Moore approached him, who said she wanted to write about it. Eventually, Moore forced him to entrust her with money management and left him without funds. She was later found guilty of the murder of Shakespeare.
Winners may be victims of crime
Shakespeare is not the only lottery winner who has been the victim of a crime. Several other lottery winners were robbed, kidnapped and even killed for their winnings.
In 2005, Illinois lottery winner Jeffrey Dampier Jr., who, along with his ex-wife, won a jackpot of about $ 20 million, was kidnapped and killed by his sister-in-law and her boyfriend. Dampier's body was found in a boyfriend's van with $ 1500 in cash in his pocket.
You may need to relocate.
Some lottery winners are persecuted to such an extent that they have to leave the city in order to find peace.
Mavis Vanczyk, a hospital employee in Chicopee, Massachusetts, was forced to take advantage of the police protection that was placed at her home after she won the $ 758,7 million Powerball jackpot. In addition to the media that literally flooded nearby courtyards, people knocked on doors in her neighborhood, trying to figure out where she lives.
Victory may lead to divorce
Don McNay said lottery winners often get divorced. This is not too surprising, considering that about one fifth of divorces are caused by money-related problems.
It was this fate that befell the British Roger and Lara Griffiths, who won the lottery 1,8 million pounds (2,3 million dollars). They spent their winnings on a dream house, Porsche, Lexus and a private school for their children. But soon Griffiths began to constantly argue about money, and six years later their marriage broke up.
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