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Why can't lottery winners be smart and live a simple lifestyle?

Topic closed. 16 replies. Last post 1 year ago by Brcebrce.

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LiveInGreenBay's avatar - driver
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Posted: January 16, 2016, 3:41 pm - IP Logged

So many stories about lottery winners going crazy and blowing everything.  I'd like to think if I won a huge amount I'd be smarter with the money.

Never give up.  Banana

    HoLeeKau's avatar - YheaShea
    Idaho
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    Posted: January 16, 2016, 4:14 pm - IP Logged

    They don't even have to live a "simple" lifestyle.  If you win enough that you can invest even just 20 million after taxes, you could live an opulent lifestyle.  That should yield more than half a mil after taxes, probably more, without even touching the original 20 million investment.  Seriously, who can't live extremely well on half a mil a year???

    I think the problem is that people feel rich when they really aren't.  In today's world to be rich enough not to have any budget limitations, you have to have billions of dollars.  They start spending and giving millions and fail to subtract it from their total.  A week after they've collected their 100 million, they've already given 10 million to their church, 20 mil to mama, and some big gifts that total millions and they're still thinking "I can afford it, I have 100 million" instead of realizing that now they only have 65.  And if they keep spending like that, next week they'll only have 40.

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      London
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      Posted: January 16, 2016, 4:18 pm - IP Logged

      They don't even have to live a "simple" lifestyle.  If you win enough that you can invest even just 20 million after taxes, you could live an opulent lifestyle.  That should yield more than half a mil after taxes, probably more, without even touching the original 20 million investment.  Seriously, who can't live extremely well on half a mil a year???

      I think the problem is that people feel rich when they really aren't.  In today's world to be rich enough not to have any budget limitations, you have to have billions of dollars.  They start spending and giving millions and fail to subtract it from their total.  A week after they've collected their 100 million, they've already given 10 million to their church, 20 mil to mama, and some big gifts that total millions and they're still thinking "I can afford it, I have 100 million" instead of realizing that now they only have 65.  And if they keep spending like that, next week they'll only have 40.

      This reminds me of that women from 'The Lottery Changed my Life'

      She won something like 10 million and bought a huge house, a bunch of cars, a really expensive car for her new boyfriend who she met after she won...... 

      I suspect that she will end up broke sooner or later.... assuming she hasn't blown it already!

      2016 Won/Lost

      EuroMillions / Spent: £22 / Won £0 / Total -£22

      UK Lotto / Spent: £4 / Won: £0 / Total: -£4

      2016 Total: -£24

      Jan: -£22 Feb: £0 ~ Mar: £0 ~ April: £0 ~ May: £0 ~ June: £0 ~ July: £2

       

      EuroMillions = £2 Line / Played: x11 [old price] 

      EuroMillions = £2.50 Line / Played: x0

      UK Lotto = £2 Line / Played x2

        lejardin's avatar - Lottery-014.jpg

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        Posted: January 16, 2016, 4:24 pm - IP Logged

        This reminds me of that women from 'The Lottery Changed my Life'

        She won something like 10 million and bought a huge house, a bunch of cars, a really expensive car for her new boyfriend who she met after she won...... 

        I suspect that she will end up broke sooner or later.... assuming she hasn't blown it already!

        Ironically, her story IS on "The Lottery Changed My Life" right now on TLC's show.  This is the episode where her and the fiance are looking at jets and HIS 2.2 million dollar Bugatti as a wedding gift.  She just got out of a Rolls Royce saying she WILL buy that car she just test drove.

        BUT.....she was profiled on 20/20 and it was said she just filed bankruptcy on January 6, 2015.  No clue what she has left as far as cars.  Dont know if she bought the rolls or if the fiance got his Bugatti.  On that show last night no mention of the fiance.

        So you are right, clearly she blew it all already.

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          Posted: January 16, 2016, 4:33 pm - IP Logged

          Ironically, her story IS on "The Lottery Changed My Life" right now on TLC's show.  This is the episode where her and the fiance are looking at jets and HIS 2.2 million dollar Bugatti as a wedding gift.  She just got out of a Rolls Royce saying she WILL buy that car she just test drove.

          BUT.....she was profiled on 20/20 and it was said she just filed bankruptcy on January 6, 2015.  No clue what she has left as far as cars.  Dont know if she bought the rolls or if the fiance got his Bugatti.  On that show last night no mention of the fiance.

          So you are right, clearly she blew it all already.

          Oh wow, thanks for the update!

          I love that show, my favorite episode is than father & son who won the $1m and the son ends up buying a bunch of useless crap and storing it in that motel, he even had one of those inflatable rubber aliens haha.

          I guess they're broke too now, his son bled him dry... :(

          2016 Won/Lost

          EuroMillions / Spent: £22 / Won £0 / Total -£22

          UK Lotto / Spent: £4 / Won: £0 / Total: -£4

          2016 Total: -£24

          Jan: -£22 Feb: £0 ~ Mar: £0 ~ April: £0 ~ May: £0 ~ June: £0 ~ July: £2

           

          EuroMillions = £2 Line / Played: x11 [old price] 

          EuroMillions = £2.50 Line / Played: x0

          UK Lotto = £2 Line / Played x2

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            Arizona
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            Posted: January 16, 2016, 6:01 pm - IP Logged

            What so many people fail to realize is that a million dollars isn't a lot of money in the long term. If you have a full-time job that pays more than minimum wage, but doesn't pay particularly well, you'll make about a million dollars over the course of your career.

            This is the same trap that catches so many pro athletes. A non-superstar may make half a million per year, but the average pro sports career is less than five years, so total earnings are only a couple million dollars - not a lot more than the average person; just in a shorter time.

              hearsetrax's avatar - 0118

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              Posted: January 16, 2016, 6:01 pm - IP Logged

              So many stories about lottery winners going crazy and blowing everything.  I'd like to think if I won a huge amount I'd be smarter with the money.

              its called too many decades spent working and looking at the world like this and not enough time working and trying to find this syndrome

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                Posted: January 16, 2016, 7:26 pm - IP Logged

                They don't even have to live a "simple" lifestyle.  If you win enough that you can invest even just 20 million after taxes, you could live an opulent lifestyle.  That should yield more than half a mil after taxes, probably more, without even touching the original 20 million investment.  Seriously, who can't live extremely well on half a mil a year???

                I think the problem is that people feel rich when they really aren't.  In today's world to be rich enough not to have any budget limitations, you have to have billions of dollars.  They start spending and giving millions and fail to subtract it from their total.  A week after they've collected their 100 million, they've already given 10 million to their church, 20 mil to mama, and some big gifts that total millions and they're still thinking "I can afford it, I have 100 million" instead of realizing that now they only have 65.  And if they keep spending like that, next week they'll only have 40.

                "people feel rich when they really aren't."

                Plenty of people who really were rich have gone broke. I think there are two interrelated problems that trip people up.

                One is that they don't realize that being rich doesn't mean you've got unlimited wealth. Bill Gates could lead an extremely lavish lifestyle and still have trouble spending all of his money, but somebody with 25, 50, or even $100 million could blow it fairly quickly if they don't realize that as rich as they are they still have limits.

                The other is that even if you've got $100 million in the bank you're still living on a fixed income if you spend a significant portion of the annual income. Taxes on interest income and inflation mean that you can't spend $2 million the first year and have the same spending power for 50 years unless interest rates get a lot better than what a safe investment pays today. You half a million example would only be worth 1/4 million after 25 years if we have 3% inflation. If you compare your lifestyle to a celebrity that's also worth $100 million you may think  you can  have the same lifestyle, but that celebrity will probably earn much more than you do, even if you're getting a great  rate on your investment.

                There's no question that $100 million makes you very rich, but if you want to leave a lot to your heirs or want to live another 40 or 50 years it's going to offer a very comfortable lifestyle, but not an extremely lavish one.  You can have a very nice house, fly first class several times a year and stay at very nice resorts when you go on vacation. You can drive a 100k car and even have a modest yacht. You probably can't have your own private jet (or even something beyond a minimum NetJets share), a 100' yacht, and a fleet of expensive cars unless you're willing to make sacrifices somewhere else or risk running out of money before you remember to die.

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                  New Member
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                  Posted: January 16, 2016, 7:39 pm - IP Logged

                  There probably are plenty of lottery winners who are smart with their money, but part of being smart is keeping a low profile, so we don't hear about them.

                  Other argument:

                  • The odds of winning a lottery go up the more tickets you buy
                  • Buying a lot of tickets is not smart
                  • Therefore, a disproportionately large number of dumb people win the lotteries
                    lejardin's avatar - Lottery-014.jpg

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                    Posted: January 16, 2016, 8:24 pm - IP Logged

                    Oh wow, thanks for the update!

                    I love that show, my favorite episode is than father & son who won the $1m and the son ends up buying a bunch of useless crap and storing it in that motel, he even had one of those inflatable rubber aliens haha.

                    I guess they're broke too now, his son bled him dry... :(

                    Ditto, lol, it is my favorite show(s) even tho they are old and all reruns.  The people you speak is the "ficks", Leroy and his son Jeff from Michigan.  They were a  disaster waiting to happen.  Jeff mentioned the name of the hotel and the camera showed the exact room number of his "storage" room.  They have been the topic of a lot of posts here including yours truly.  I was actually embarrassed watching them.

                    My favorite episode was the Morrisons of New York, a real feel good story.  They bought a beautiful $3.9 million dollar house.  They had run a homeless shelter and the government shut them down claiming they were overbilling.  People told them you have the money to pay back what you owed so why not do it?   Mr. Morrison said there was no way because they were not guilty.  They proved they were right, government closed the case and they were cleared of any wrongdoing. 

                    My other favorite was James Gadske, called the hotel millionaire.  Very down on his luck and down to his last couple of bucks, played the lottery and won.  He was so disheveled that no one would help him claim his winnings.  Imagine that?  Once he got his money after an old friend helped him and did NOT take advantage him, he decided to live at a neighbor hotel.  Lived very quietly and he said he didnt need much.  Just a nice clean place, he had a tv, radio, chair, hot running water and utilities he didnt want for anything. 

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                      Happy California
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                      Posted: January 16, 2016, 10:39 pm - IP Logged

                      Ditto, lol, it is my favorite show(s) even tho they are old and all reruns.  The people you speak is the "ficks", Leroy and his son Jeff from Michigan.  They were a  disaster waiting to happen.  Jeff mentioned the name of the hotel and the camera showed the exact room number of his "storage" room.  They have been the topic of a lot of posts here including yours truly.  I was actually embarrassed watching them.

                      My favorite episode was the Morrisons of New York, a real feel good story.  They bought a beautiful $3.9 million dollar house.  They had run a homeless shelter and the government shut them down claiming they were overbilling.  People told them you have the money to pay back what you owed so why not do it?   Mr. Morrison said there was no way because they were not guilty.  They proved they were right, government closed the case and they were cleared of any wrongdoing. 

                      My other favorite was James Gadske, called the hotel millionaire.  Very down on his luck and down to his last couple of bucks, played the lottery and won.  He was so disheveled that no one would help him claim his winnings.  Imagine that?  Once he got his money after an old friend helped him and did NOT take advantage him, he decided to live at a neighbor hotel.  Lived very quietly and he said he didnt need much.  Just a nice clean place, he had a tv, radio, chair, hot running water and utilities he didnt want for anything. 

                      I Agree! I also enjoy those shows which you speak of. Especially after a Power Ball run of 1.568 Billion.

                       Chi ha danari, trova cugini. (He who has money finds many cousins.) Italian proverb

                        Coin Toss's avatar - shape barbed.jpg
                        Zeta Reticuli Star System
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                        Posted: January 16, 2016, 10:50 pm - IP Logged

                        Why can't lottery winners be smart and live a simple lifestyle?

                        Greed, ego. Not all, but the ones who go broke.

                        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.

                          HoLeeKau's avatar - YheaShea
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                          Posted: January 17, 2016, 11:02 am - IP Logged

                          "people feel rich when they really aren't."

                          Plenty of people who really were rich have gone broke. I think there are two interrelated problems that trip people up.

                          One is that they don't realize that being rich doesn't mean you've got unlimited wealth. Bill Gates could lead an extremely lavish lifestyle and still have trouble spending all of his money, but somebody with 25, 50, or even $100 million could blow it fairly quickly if they don't realize that as rich as they are they still have limits.

                          The other is that even if you've got $100 million in the bank you're still living on a fixed income if you spend a significant portion of the annual income. Taxes on interest income and inflation mean that you can't spend $2 million the first year and have the same spending power for 50 years unless interest rates get a lot better than what a safe investment pays today. You half a million example would only be worth 1/4 million after 25 years if we have 3% inflation. If you compare your lifestyle to a celebrity that's also worth $100 million you may think  you can  have the same lifestyle, but that celebrity will probably earn much more than you do, even if you're getting a great  rate on your investment.

                          There's no question that $100 million makes you very rich, but if you want to leave a lot to your heirs or want to live another 40 or 50 years it's going to offer a very comfortable lifestyle, but not an extremely lavish one.  You can have a very nice house, fly first class several times a year and stay at very nice resorts when you go on vacation. You can drive a 100k car and even have a modest yacht. You probably can't have your own private jet (or even something beyond a minimum NetJets share), a 100' yacht, and a fleet of expensive cars unless you're willing to make sacrifices somewhere else or risk running out of money before you remember to die.

                          The other is that even if you've got $100 million in the bank you're still living on a fixed income if you spend a significant portion of the annual income. Taxes on interest income and inflation mean that you can't spend $2 million the first year and have the same spending power for 50 years unless interest rates get a lot better than what a safe investment pays today. You half a million example would only be worth 1/4 million after 25 years if we have 3% inflation.

                          But in 25 years, you'd still have your original investment sitting there.  You could start spending that down, maybe by investing in an annuity or something else a good advisor could help you with, and increase your available income for the next 25 years.  When that runs out, the winner would likely be dead unless they won at a very early age.

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                            Happy California
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                            Posted: January 17, 2016, 12:32 pm - IP Logged

                             I have read that 70% of lottery winners are either broke or in financial difficulties five years after their win.

                             Chi ha danari, trova cugini. (He who has money finds many cousins.) Italian proverb

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                              Posted: January 17, 2016, 12:36 pm - IP Logged

                               I have read that 70% of lottery winners are either broke or in financial difficulties five years after their win.

                              That's crazy.......

                              2016 Won/Lost

                              EuroMillions / Spent: £22 / Won £0 / Total -£22

                              UK Lotto / Spent: £4 / Won: £0 / Total: -£4

                              2016 Total: -£24

                              Jan: -£22 Feb: £0 ~ Mar: £0 ~ April: £0 ~ May: £0 ~ June: £0 ~ July: £2

                               

                              EuroMillions = £2 Line / Played: x11 [old price] 

                              EuroMillions = £2.50 Line / Played: x0

                              UK Lotto = £2 Line / Played x2