Why you might go bankrupt if your next-door neighbor wins the lottery

Comment #39

KY Floyd — Sat, 20 Feb 2016 18:26:18 GMT

they said the bankruptcies went up 2% for each 1K of the prize. So that could be a very significant increase if ...

Here's a novel idea. Imagine that somebody wins 200k and bankruptcies increase by 400%. You think that's significant?

Now imagine that your chances of winning PB increase by 400% to 1 in 73 million. You think that's significant

Comment #38

HoLeeKau — Sat, 20 Feb 2016 16:14:56 GMT

The sample averaged 13 for each lottery winner's neighbors they followed. I think 13 might actually be too big because they wanted to know how the winner's increased conspicuous consumption affected those living around them. I might notice what 8 of my neighbors purchase if it's parked in front of their home, but I really doubt I'd notice any further away than that.

Plus, they said the bankruptcies went up 2% for each 1K of the prize. So that could be a very significant increase if you live n... [ More ]

Comment #37

Teddi — Sat, 20 Feb 2016 12:25:55 GMT

I thought I was the only one who saw it. LOL. This study made me think of that movie too.

For those who didn't see it, a corporation puts actors into upper middle-class neighbourhoods, posing as perfect families. They give the appearance of the family everyone else wants to be.

Pretty soon the other wives are buying the same types of furniture, packaged foods and hair products Mrs Jones has, the men are buying the same golf clubs and big screen tv Mr Jones has, ditto with the teens on cl... [ More ]

Comment #36

Artist77 — Sat, 20 Feb 2016 11:55:33 GMT

I agree with Golfer. That sample of 13 is insignificant and it looks like they kept reducing the sample size to achieve a predetermined result. I think they wanted publicity for their research. Hopefully someone will redo the study and show it is ridiculous. And yes, I read the study and know that is one zip code but 13 is still too small a sample size.

Comment #35

Teddi — Sat, 20 Feb 2016 11:47:30 GMT

You really need to take a Xanax and calm yourself down. There is nothing in this entire article anyone would need to get this worked up about. Common sense alone should tell you it isn't an anti -lottery hitjob. When has having a lottery win in a close vicinity ever decreased lottery sales? Instead people play more. They buy tickets at the same store as the winner.

If all the lottery winners who end up dead, end up bankrupt, end up behind bars, or end up hounded/sued for years doesn't stymie... [ More ]

Comment #34

rowlettewheel — Fri, 19 Feb 2016 13:30:41 GMT

I'd move another State, and tell no ONE...

It works....

Comment #33

dallascowboyfan — Thu, 18 Feb 2016 17:04:17 GMT

there was a movie with Demi Moore called The Joneses that touched on this.

Comment #32

golfer1960 — Wed, 17 Feb 2016 20:04:40 GMT

This is just about income inequality and made to look like legit research:

By demonstrating what the economists described as causal evidence on the link between income inequality and financial distress, their paper adds to the growing use of data on lottery winners to examine the economic and social effects of sudden income windfalls.

Comment #31

golfer1960 — Wed, 17 Feb 2016 20:01:15 GMT

This is just another hit piece on income inequality.

Income inequality induces poorer neighbors to consume more visible (rather than invisible) commodities to signal their abilities to 'keep up with the Joneses' to their richer neighbors, economists Sumit Agarwal, Vyacheslav Mikhed and Barry Scholnickwrote. This tendency can lead to additional and unsustainable borrowing among the relatively poor to finance this additional conspicuous consumption, which can eventually result in financial dis... [ More ]

Comment #30

Murgatroyd — Wed, 17 Feb 2016 18:14:30 GMT

The analysis only contained postal codes with 13 households? That's pretty small isn't it?

No, the analysis contained all Canadian neighborhoods, divided up by postal code. Each Canadian postal code, on average, contains about 13 households. The methodology was to compare bankruptcy rates in each winner's postal code (i.e. the winner's immediate neighbors) with the rates in nearby postal codes, where people's general economic status is about the same, but they aren't quite so physically close... [ More ]

Comment #29

Gleno — Wed, 17 Feb 2016 15:58:35 GMT

Keeping up with your neighbors is a losing philosophy.

Comment #28

golfer1960 — Wed, 17 Feb 2016 14:44:39 GMT

This article is full of crap!

This type of garbage is designed to get people not to play the lottery.

Look at what they wrote: They analyzed lottery prizes and bankruptcy filings over 10 years, sorted down to six-digit postal codes that on average contained only 13 households, revealing financial ripple effects on a lottery winner's closest neighbors. They limited their analysis to neighborhoods with a single lottery win and excluded cases when lottery winners themselves filed for bankrupt... [ More ]

Comment #27

sully16 — Wed, 17 Feb 2016 13:34:57 GMT

The Federal Reserve is hazardous to our health.

Comment #26

haymaker — Wed, 17 Feb 2016 13:29:15 GMT

I will gladly pay you Tuesday for a hamburger today

Comment #25

Dotun lotto — Wed, 17 Feb 2016 12:17:18 GMT

Midweek will surely paid us today kindly call me right now to verify your name 08053758492

Comment #24

JAMORA — Wed, 17 Feb 2016 07:28:44 GMT

I think they probably feel like it could have been them, and then outspend their expendable income in hopes that lightening will strike twice....imagine the increase in lottery sales at the neighborhood store where a $$$$million dollar ticket was sold...

Comment #23

lulu1feather — Wed, 17 Feb 2016 05:46:42 GMT

I don't know how I feel about this. To me, it sounds kind of like blaming a spoon for making someone obese.

When I win, I'll be leaving my neighbors behind in a jiffy! So, they can just go about their normal lives without having to spend the last of their retirement funds to compete with 'Ol Moneybags next door.

Comment #22

OldSchoolPa — Wed, 17 Feb 2016 03:34:03 GMT

Just ask Cynthia Stafford....

Comment #21

Murgatroyd — Wed, 17 Feb 2016 00:22:57 GMT

It's worth noting that this study does not deal with what most people here would consider large jackpots. It looks at Canadian provincial lotteries, with prizes ranging from C$1,000 to C$150,000. It deliberately excludes the big winners.

Comment #20

mypiemaster — Wed, 17 Feb 2016 00:02:28 GMT

If you can't manage your money, you might still go bankrupt whether you are surrounded by hoodrats or lottery winners.

Comment #19

Seattlejohn — Tue, 16 Feb 2016 20:55:50 GMT

Keeping up with the Jones's... even if the Jones's are now bazillionaires...

Comment #18

ronki — Tue, 16 Feb 2016 19:05:55 GMT

that's right who would stay in the same house the first thing is move where they don't know you

Comment #17

TheGameGrl — Tue, 16 Feb 2016 18:51:05 GMT

Some folks can appreciate blessings.

Comment #16

Groppo — Tue, 16 Feb 2016 18:15:07 GMT

Yes, I would too.

Comment #15

OneTrickpony — Tue, 16 Feb 2016 18:01:30 GMT

Now that IS funny. Not only will they be too embarrassed to ever ask you for money again (now would be a good time to win the lottery for real...), you found out their true character. Are you still friends with those people, or did they slowly fade away from your circle? If you uploaded the video to YouTube, you have to give us the link

Comment #14

Groppo — Tue, 16 Feb 2016 17:56:34 GMT

Bingo.

Comment #13

Groppo — Tue, 16 Feb 2016 17:54:46 GMT

Yeah, no way would I stay.

I would certainly move, as my n/hood is not what it was 40 years ago.

And, if winning the lotto did happen to me, I wouldn't want people to play

Keeping up with the Jones's , and cause them undue financial stress.

Comment #12

VenomV12 — Tue, 16 Feb 2016 17:49:42 GMT

Ha Ha, that's great.

Comment #11

HoLeeKau — Tue, 16 Feb 2016 17:35:11 GMT

That's hilarious! Imagine the phone ringing off the wall if you had won $50 million

Comment #10

tnlottodreamer — Tue, 16 Feb 2016 17:12:33 GMT

A few years ago a friend and I pretended we won $50.000 on a two dollar JUMBO buck scratch off. We changed the 13 to a 18. We went up to the lottery district office and we did a selfie of us holding the ticket. We then posted the video on Facebook and we were yelling and screaming woohoo we won. Well I had 2 people call me and at least 5 or 6 people send me a message begging me for money. I told them it was just a joke well im sure that embrassed the heck out of them. It was really funny and I s... [ More ]

Comment #9

Spiritualist — Tue, 16 Feb 2016 16:57:48 GMT

And why should I listen to research by the Fed anyway? It's a corrupt organization that has actively worked to devalue the purchasing power of my currency.

Comment #8

luckyshoes — Tue, 16 Feb 2016 16:44:55 GMT

Don't try to keep up with the Jones.....

Success isn't in Having money...it's in Handling it

Comment #7

VenomV12 — Tue, 16 Feb 2016 16:29:20 GMT

Depending on the part of the country and the amount you win you could move to the most affluent neighborhood in the area and still be vastly wealthier than anyone else. I know a billionaire that lives in a $1.6 million house and the most expensive home in the area is maybe $2 million, maybe a little more so he's right up there without barely having to spend any of his money. He could build a $10 million castle out there easily but then he would never ever be able to sell it. So if you won $50 mi... [ More ]

Comment #6

RJOh — Tue, 16 Feb 2016 16:22:19 GMT

Sometimes lottery winners go bankrupt too acting as rich as others think they are or should be.

Comment #5

music* — Tue, 16 Feb 2016 16:17:28 GMT

I purchased a new $14,000.00 car in 2006 and a neighbor bought the same make and model. I did not feel good about that. This happened in a low-income apartment complex.

I would move before making any big purchases after I win big.

Comment #4

tnlottodreamer — Tue, 16 Feb 2016 16:16:49 GMT

Why do people think they have keep up with their neighbors for? I don't keep up with no one. I buy and do what I want and can careless what the neighbors buy or do.

Comment #3

HoLeeKau — Tue, 16 Feb 2016 15:31:58 GMT

That's what I was wondering too. Did they analyze the neighborhood the winner was in when they won, even if they moved? Or just the neighborhood they moved to

Comment #2

gocart1 — Tue, 16 Feb 2016 15:30:17 GMT

YES ....I WOULD MOVE IN A HEARTBEAT ..ALL THE PEOPLE LOOKING FOR A HANDOUT , WOULD MAKE ME GO UNDERGROUND SOMEWHERE.

Comment #1

TheMeatman2005 — Tue, 16 Feb 2016 15:21:29 GMT

Don't most lottery winners move to a more affluent neighborhood after winning?

I don't think I would be living in my current residence after I win a significant prize amount.

Why you might go bankrupt if your next-door neighbor wins the lottery

Lottery Post — Tue, 16 Feb 2016 15:12:42 GMT

Winning the lottery can be hazardous to your neighbors' financial health.

Research released this month by the Federal Reserve Bank of Philadelphia found a significant jump in bankruptcies among households living near someone who won a big lottery jackpot. The economists theorized that people may have seen the good fortune next door and felt pressure to accumulate more assets of their own, especially flashy purchases like cars, that they simply could not afford.

Income inequality induces p... [ More ]