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Best jackpot advice yet

Topic closed. 32 replies. Last post 9 years ago by CARBOB.

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Coin Toss's avatar - shape barbed.jpg
Zeta Reticuli Star System
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Posted: December 26, 2007, 9:24 am - IP Logged

We were watching TLC last night when they showed the lottery programs.

When David Edwards came on my wife said he sounded likedecent guy. I told her people on LP said he was just like Jack Whitaker. She asked why so I looked on the net (couldn't remember exactly what he had done) and found this.

Considering all our threads here about "What would you do if you won $ _ _ _ million", this is well worth reading (my bolding, article on blue background):

David Edwards, another lottery loser

Don McNay

"The world’s original hard luck story and a hard time losing man."

-Jim Croce

In light of increasing media cost consciousness, news outlets can save money by pre-arranging a "fill in the blanks" news story.

It would say:

Powerball winner ______________ is in trouble with the law again. This is the _____ time the jackpot recipient has been arrested.

There are reports that he/she has spent all of their money in _____ years. There have been ______ lawsuits filed against he/she and family members in the past year.

The media should have the story ready. They are going to use it over and over again.


The most recent chance to “fill in the blanks” came from Powerball winner David Edwards, who hails from Ashland, Ky.

Ken Hart at the Ashland Independent newspaper has written a number of articles about Edwards and his wife Shawna.

Edwards won a $41 million Powerball and took home $27 million in August 2001. Six years later, the money was apparently gone.

Edwards was evicted from his $1.2 million home in Palm Beach Garden, Fla., for not paying his association dues. Shortly thereafter, Edwards was evicted from a storage unit that he was apparently living in. The items in storage were auctioned to pay Edward’s storage fees.

His wife was arrested for not paying $17,000 in back child support. She was released and then arrested again. She missed a court date and failed a drug test.

You would think someone who won the lottery would get it right.

About a week after Edwards won the lottery, I watched him on television and predicted that he would run through all the money. He had every red flag for disaster. An out-of-work ex-con, Edwards immediately acquired an entourage and went on a buying spree. He was all over the media, and I remember him saying that he was going to meet with financial advisers.

If I had been Edwards’ financial advisor, I would not put it on my resume.

I’m not sure the best adviser could have kept Edwards from running through the money. There would have been several ways to try. Before Edwards started spending like a drunken sailor, an adviser could have placed some of the money into a trust and some into annuities that would have paid over Edwards lifetime.

It didn’t happen, and Edwards became another “shake your head” kind of story.

I saw Edwards on a show called “The Curse of the Lottery.” The show’s premise was that winning the lottery was a curse, not a blessing.

Receiving a life-changing amount of money is not a curse as long as the receiver takes steps to keep him or herself under control.

Most people have built-in controls on their finances. They work for a paycheck and pay their bills. They have a budget based on a steady amount coming in.

When people get “sudden money” from an inheritance, lottery or other source, they often don’t know how to handle it.

It makes them easy prey to family and friends wanting a “loan” and prey to temptation to spend on unneeded items.

There is a whole economy built around people who let money run through their fingers.


I’ve noted a ton of advertisements aimed at “helping” people spend their tax refunds. A tax refund is not manna from heaven. A refund means that the government took more money out of a person’s paycheck than needed. People should be saving that money for a rainy day instead of blowing it on a trip to Las Vegas.

If people can’t handle a tax refund, imagine what they would do with $27 million.

It is actually easier to handle big money than manage a small amount. With big money, there is a point where all your immediate needs can be met. You can buy a nice house and car and not have any debts. You can go anywhere you want and do what you want.

After that, everything else is just showing off.

It is the showing-off part that gets lottery winners into trouble.

The less flash they have with their money, the less likely they are to be part of a “fill in the blanks” media story.


Edwards is another lottery hard-luck story and a hard-time losing man.

Don McNay is author of the upcoming book, “Son of a Son of a Gambler: Winners, Losers and What to Do if you win the Lottery.”

 

 

We've had plenty of threads about remaining anonymous or not and some people say they'd want all the publicity they could get.

We've had threads about winning multi - millions and buying fleets of cars and mansions.  

The story above tells us that the less showing off people do with a jackpot win, the more likely they are to keep it.

Those who run the lotteries love it when players look for consistency in something that's designed not to have any.

Lep

There is one and only one 'proven' system, and that is to book the action. No matter the game, let the players pick their own losers.

    sirbrad's avatar - Lottery-062.jpg
    PA
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    Posted: December 26, 2007, 4:48 pm - IP Logged

    As I stated before though this is ONE "extreme" example. You have to be very very stupid to ever have it as bad as David did, then as great as he did, then back to worse than he started. Medoa loves this story however, as all the other thousands of successful lottery winners induce boredom. 

      justxploring's avatar - villiarna
      Wandering Aimlessly
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      Posted: December 26, 2007, 6:00 pm - IP Logged

      I think that the most important thing when a person wins a jackpot, is he must realize that this is probably going to be a once in a lifetime opportunity and that he got very, very, very, very lucky.  The reason someone in Hollywood can usually (but not always) afford to be flashy and we read about the celebrities who blow millions, is because they are capable of earning that money back.  Most of us aren't in that type of profession where we can turn around a loss that quickly.  Ex: Will Smith was interviewed on TV a couple of weeks ago. If what he said is true, he blew over $5M when he was just 18 yrs old. Then the IRS reminded him he didn't pay his taxes and garnished his wages over the next few years until all $2M+ interest was repaid. However, most of us don't have the earning power of a Will Smith or a Tom Cruise or an Oprah.  So being flashy can be dangerous because it's human nature to want more and an elaborate lifestyle is very expensive to maintain.

      I do agree, however, that the story of David Edwards is extreme.  I knew someone who made so much money in land development in the 80s that he went a little crazy, but he always kept enough invested to fall back on.  I think the best thing is to try to live on the interest.  Then you can spend all you want on travel, cars, boats and having fun but still have the principal when you run out!  If you ended up with "only" $5 million after tax, $250,000 a year would be the minimum you'd get just in interest alone.

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        nashville
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        Posted: December 26, 2007, 6:09 pm - IP Logged

        I think that the most important thing when a person wins a jackpot, is he must realize that this is probably going to be a once in a lifetime opportunity and that he got very, very, very, very lucky.  The reason someone in Hollywood can usually (but not always) afford to be flashy and we read about the celebrities who blow millions, is because they are capable of earning that money back.  Most of us aren't in that type of profession where we can turn around a loss that quickly.  Ex: Will Smith was interviewed on TV a couple of weeks ago. If what he said is true, he blew over $5M when he was just 18 yrs old. Then the IRS reminded him he didn't pay his taxes and garnished his wages over the next few years until all $2M+ interest was repaid. However, most of us don't have the earning power of a Will Smith or a Tom Cruise or an Oprah.  So being flashy can be dangerous because it's human nature to want more and an elaborate lifestyle is very expensive to maintain.

        I do agree, however, that the story of David Edwards is extreme.  I knew someone who made so much money in land development in the 80s that he went a little crazy, but he always kept enough invested to fall back on.  I think the best thing is to try to live on the interest.  Then you can spend all you want on travel, cars, boats and having fun but still have the principal when you run out!  If you ended up with "only" $5 million after tax, $250,000 a year would be the minimum you'd get just in interest alone.

        what you said is true justx because the difference between a david edwards lottery winner and britney spears is that britney releases an album or sells more perfume and she can replace the money she blew on a new car or house but a lottery winner who doesnt invest their money doesnt have an income stream to replace what they spend so eventually like edwards they have spent all of the money or they owe the IRS more money.

          LuckyLilly's avatar - savy chick.png

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          Posted: December 26, 2007, 6:18 pm - IP Logged

          what you said is true justx because the difference between a david edwards lottery winner and britney spears is that britney releases an album or sells more perfume and she can replace the money she blew on a new car or house but a lottery winner who doesnt invest their money doesnt have an income stream to replace what they spend so eventually like edwards they have spent all of the money or they owe the IRS more money.

          I just read where Britney Spears makes AND SPENDS almost $800,000 PER MONTH!  I dunno how accurate the article is, but it says she does not save nor invest a penny of that income.  If I were her, I'd start getting a little worried tho, because it's questionable just how long her income will continue if the rumors are true that her career is on the skids.

            Coin Toss's avatar - shape barbed.jpg
            Zeta Reticuli Star System
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            Posted: December 26, 2007, 6:49 pm - IP Logged

            I'm not so sure anymore about Edwards being that much of an extreme example.

            On those lottery programs on TLC it was pointed out at least three times that the states are that half or over half of jackpot winners are worse off than they were before they hit the jackpot, withing five years.

            So if you hit a jackpot, right off the bat it's a coin toss Wink  whether you will be one of those statistics or not.  

            That's not any 1 in 175,000,000 odds, that's 1 out of 2.  

            Those who run the lotteries love it when players look for consistency in something that's designed not to have any.

            Lep

            There is one and only one 'proven' system, and that is to book the action. No matter the game, let the players pick their own losers.

              justxploring's avatar - villiarna
              Wandering Aimlessly
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              Posted: December 26, 2007, 6:59 pm - IP Logged

              I'm not so sure anymore about Edwards being that much of an extreme example.

              On those lottery programs on TLC it was pointed out at least three times that the states are that half or over half of jackpot winners are worse off than they were before they hit the jackpot, withing five years.

              So if you hit a jackpot, right off the bat it's a coin toss Wink  whether you will be one of those statistics or not.  

              That's not any 1 in 175,000,000 odds, that's 1 out of 2.  

              Well, if this is really accurate then (as judgmental as I sound) most people who win must be fools.  I mean, I've made a few major boo-boos in my life, but I can't imagine blowing millions after winning a jackpot.  I hope I get the chance to prove them wrong - or even right!  Just the chance is all I ask!

              Smiley

                Coin Toss's avatar - shape barbed.jpg
                Zeta Reticuli Star System
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                Posted: December 27, 2007, 12:11 am - IP Logged

                Oh yeah, we all want to be the one to prove otherwise, "Give me the chance, let me try it!"

                Smile

                Those who run the lotteries love it when players look for consistency in something that's designed not to have any.

                Lep

                There is one and only one 'proven' system, and that is to book the action. No matter the game, let the players pick their own losers.

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                  Kentucky
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                  Posted: December 27, 2007, 1:53 am - IP Logged

                  "A tax refund is not manna from heaven. A refund means that the government took more money out of a person’s paycheck than needed. People should be saving that money for a rainy day instead of blowing it on a trip to Las Vegas."

                  Nobody will dispute that David Edwards blew his windfall but doesn't mean it's a bad idea for people use their tax refund for a vacation.

                  "If people can’t handle a tax refund, imagine what they would do with $27 million."

                  I sure hope sure hope I can handle my $300 refund and won't have financial problems in the future.

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                    Posted: December 28, 2007, 10:26 am - IP Logged

                    I liked some of the examples given on people who are poor money managers. The majority of the people who win the lottery are average middle class or working poor (I include myself it this group) who have very little money management experience, meaning how to save, invest etc.  We all know how to live payday to payday but when that sudden win fall of several million dollars come, its "Lets Party" for most, seeing the means of every desire could be full filled, with no thought of what to do when the money is gone or even having a clue that it will run out eventually with no proper investments or spending limits. I think the tax refund is an excellent parity of what some people do with what Uncle Sam has done by taking too much out of one's check, they get the refund in the mail or direct deposit and its "Party Time". However, I must say there is a group of people who play the lotto that are good money managers; I have acquaintance's who won the Texas lotto and is still benefiting from it, why because they were good money managers to begin with!!!

                    A few years ago, billionaire Warren Buffett advised  "Investors should remember that excitement and expenses are their enemies. And if they insist on trying to time their participation in equities, they should try to be fearful when others are greedy and greedy only when others are fearful."

                      sirbrad's avatar - Lottery-062.jpg
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                      Posted: December 28, 2007, 5:54 pm - IP Logged

                      I have always been very good managing money, and look forward to the opportunity to have A LOT more to manage. My goal is too simply live off of the interest, and to me the principal does not even exist. I can live great on anything from $25,000 and up, preferably $50,000 at least. I also have a few other advantages as well, only about on true family member and I live in a very dead area.

                      Which is why I also would not mind winning the $15 million dollar jackpot, no one would even know nor care. Only the larger ones make worldwide news. But again I also do not care either way, as no one can nor will intimidate me, nor change my lifestyle.

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                        Posted: December 29, 2007, 2:06 am - IP Logged

                        As has been discussed ad nauseum:  If I won a jackpot, I'd put 5 mill in investment-grade annuities, and I'd blow/endow/donate all the rest.

                        Because I'd still have enough to live on, and, 'you can't take it with you'.  Life is short, live now. 

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                          A long and winding road
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                          Posted: December 29, 2007, 10:00 pm - IP Logged

                          Guesser, I love the line "You cant take it with you!".

                          I used to be sooo miserly with my funds, careful and non risky with my budget or how I contributed.

                          After that quote hit me, I realized what am I saving for? For someone else to figure out what to do with the funds? Its there to enjoy or use in a meaningful way. I dont beleive in going hog wild and such but I have learned that if ya cant take it with you, at least enjoy it while you can!.

                          Its troublesome and almost incomprehensible that such a windfall can vanish for a person who really does KNOW what its like to have not. It shouldn't take a person down the same road twice if they learned from their mistakes the first time. I guess the Fool me twice quote does hold true for Edwards....

                          ~~Is it true, Is it kind,Is it necessary. ~~~

                           Thanks be to the giving numbers: 1621,912,119 02014


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                            Posted: December 29, 2007, 11:46 pm - IP Logged

                            Of course it's easy for most of you to sit here and say you wouldn't blow that much money but until you put in that situation, you don't know what you would do. I can sit here and say, "I would never steal anything from the store." And being that I'm better off than most and always have food on my table and a steady check coming in every week - it's easy for me to make that statement.

                            Put me in a situation where I lost my job, the economy took a nose dive and the prices for neccessities shot up through the roof. Then put me in a store where I think there's no cameras around and I have a wife and kid at home needing food with no money on me but the food is right there, right there..... talk about reality.

                            I'm sure those very people you guys are criticizing are people like you and I. Before they won the lottery, they live pay-check to pay-check and had the same thoughts as you and I, "If I win the lottery, I would never blow it like that...." Blah, blah... like I said, until you're put in that situation, you don't know what you're do.

                            I know for sure ( just by reading some you people's responds) that you would blow that money before year's end. I can tell in by the things you say and your way of thinking.

                              guesser's avatar - Lottery-017.jpg

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                              Posted: December 30, 2007, 1:59 am - IP Logged

                              Of course it's easy for most of you to sit here and say you wouldn't blow that much money but until you put in that situation, you don't know what you would do. I can sit here and say, "I would never steal anything from the store." And being that I'm better off than most and always have food on my table and a steady check coming in every week - it's easy for me to make that statement.

                              Put me in a situation where I lost my job, the economy took a nose dive and the prices for neccessities shot up through the roof. Then put me in a store where I think there's no cameras around and I have a wife and kid at home needing food with no money on me but the food is right there, right there..... talk about reality.

                              I'm sure those very people you guys are criticizing are people like you and I. Before they won the lottery, they live pay-check to pay-check and had the same thoughts as you and I, "If I win the lottery, I would never blow it like that...." Blah, blah... like I said, until you're put in that situation, you don't know what you're do.

                              I know for sure ( just by reading some you people's responds) that you would blow that money before year's end. I can tell in by the things you say and your way of thinking.

                              Luckily, there are SOME folks here that tell it like it is: as I said, I'd save a little, and blow all the rest.

                              If I won, say, 50 mill, why on earth would I even WANT to try and grow it to more ?   We ALL work our butts off, and for what: to make it to 'retirement'.  OK, so now I won 50 mill, I'm retired.   Sure, I could set up family so they are better off, but I keep asking myself, would they do the same for me if they won ?    The heart says yes, reality says NO.     

                              Yep - you 'know for sure' some would blow all the money by years' end, but I'm not one of those.  Yep - I'd blow 90% of it - but that doesn't mean I'm going to blow it all by years' end, it means I'm going to do with it what *I* want to do with it, and to he11 with anyone that thinks I should do certain things with it - according to THEIR whims.   If Uncle Jack wants a new fishing boat, Uncle Jack can go buy one - either a fishing boat, or a lottery ticket - his choice.  Is that being 'mean' on my part ?   That I have 50 mill and won't part with 20K to Uncle Jack ?    Nope. If you take care of Uncle Jack's wish, where do you draw the line ?  Who do you draw the line with ?    At what dollar amount do you draw the line ?   (Of course, if Uncle Jack had terminal cancer, that's a MUCH different story).

                              You are spot-on when you say the circumstances dictate how you live: I'm pretty thrifty and VERY conservative with what I have, if it was just me, I'd live in a mobile home, but the wife dictates we keep this big house, it must be some sort of status symbol that we maintain a bigger, nicer house than her 'friends'.  (PS - don't jump my back - Lived in a mobile home for 25 years and LOVED it).