Biggest reason for Lottery Winners going broke soon? :/Prev Topic Next Topic

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GiveFive

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Jan 12, 2023, 9:53 am

Quote: Originally posted by Artist77 on Jan 11, 2023
The book-The Millionaire Next Door- says the same thing. Generational wealth lasts 2-3 generations at best and when it gets to a generation that has never worked for anything , the $ goes quickly.

Brand new (rookie) professional athletes that sign multi-million dollar contracts are very susceptible to blowing it all and going broke.

I know of one pro sports team that had what they called a "Player Development" Coach. That particular coach's job (he was a former star athlete that had played for the team) had nothing whatsoever to do with the players athletic ability on the playing field. Instead the Coach's job was to try help new players not to squander their brand new fortune.

When I first learned that the team had such a Coach, I was curious as to why they had him on staff. My guess is that the team had seen new players with big contracts join the team only to blow it all. A lot of money is a wonderful thing to have, but ya gotta know how it must be managed or else you wont have it very long. G5

Play Smart! That's IF there is such a thing as playing smartly!!
AdamGalas

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Jan 12, 2023, 3:35 pm

I just learned on Bloomberg that 70% of lottery winners spend or lose all the money within 5 years.

Even $500 million jackpot winners.

So smart move for most people is to take annuity option.

You are guaranteed to remain rich for 30 years.

Naturally I would still take the cash option but I'm a hedge fund manager who lives my life via spreadsheets.

The only thing I buy if I win is a 2023 Toyota Prius prime.

1% goes to charity and family and friends and 99% minus a Prius goes into my hedge fund.
PrisonerSix

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Jan 12, 2023, 4:07 pm

Quote: Originally posted by GiveFive on Jan 12, 2023
Brand new (rookie) professional athletes that sign multi-million dollar contracts are very susceptible to blowing it all and going broke.

I know of one pro sports team that had what they called a "Player Development" Coach. That particular coach's job (he was a former star athlete that had played for the team) had nothing whatsoever to do with the players athletic ability on the playing field. Instead the Coach's job was to try help new players not to squander their brand new fortune.

When I first learned that the team had such a Coach, I was curious as to why they had him on staff. My guess is that the team had seen new players with big contracts join the team only to blow it all. A lot of money is a wonderful thing to have, but ya gotta know how it must be managed or else you wont have it very long. G5

That is interesting. Most pro athletes don't have log careers, so they need to save. My mother had a neighbor who played for the local NFL team and his mother was helping him manage his money.

He got a monthly $4k allowance and the rest was saved and invested. He was lucky to have someone he could trust helping him. Many so called advisors may not be trustworthy, so one must be careful.

Prisoner Six

"I am not a number, I am a free man!"
Lotto fanatic

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Jan 12, 2023, 7:24 pm

Quote: Originally posted by PrisonerSix on Jan 12, 2023
That is interesting. Most pro athletes don't have log careers, so they need to save. My mother had a neighbor who played for the local NFL team and his mother was helping him manage his money.

He got a monthly $4k allowance and the rest was saved and invested. He was lucky to have someone he could trust helping him. Many so called advisors may not be trustworthy, so one must be careful.

Like a woman named Peggy who was entrusted to help Athletes keep their money, but instead, she stole money to fund a lavish lifestyle for herself. The red flag there was that the athletes in the Peggy case weren't charging her any money to manage their money for her, she was managing their money for them for free supposedly out of the goodness of her heart. Someone is managing your millions for you free of charge and she's not your family or friend? Big red flag. She looked like a crazy Vanessa L Williams.
Lotto fanatic

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Jan 12, 2023, 7:30 pm

Quote: Originally posted by AdamGalas on Jan 12, 2023
I just learned on Bloomberg that 70% of lottery winners spend or lose all the money within 5 years.

Even $500 million jackpot winners.

So smart move for most people is to take annuity option.

You are guaranteed to remain rich for 30 years.

Naturally I would still take the cash option but I'm a hedge fund manager who lives my life via spreadsheets.

The only thing I buy if I win is a 2023 Toyota Prius prime.

1% goes to charity and family and friends and 99% minus a Prius goes into my hedge fund.

There was a case where a man chose the annuity for a multi Million Jackpot prize and spent the first check frivolously and the next month, he was expecting another check and when it didn't come, he complained to the lottery that he didn't get that month's check. The Lottery told him that his next check would come next year. He assumed an annuity meant monthly, not yearly. He was lucky he chose the annuity because he most likely would have blown a lump sum just as frivously as he spent that first annuity check.
Artist77

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Jan 12, 2023, 7:49 pm

LF, I would be less concerned about someone stealing your potential lottery win (that you always obsess about or someone asking you for money or pointing out stupidity in other lottery winners) vs developing an understanding of basic tax law , etc. You have big gaps in your basic knowledge vs what the typical lp member possesses. For example, thinking you are taxed twice which is illogical. Take a look at the Federal and your state tax brackets.

DO NOT BE AFRAID.

How Great Thou Art. God has blessed America.
PrisonerSix

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Jan 12, 2023, 10:11 pm

Quote: Originally posted by cottoneyedjoe on Jan 11, 2023
I saw a video on YT that said most lottery winners go broke from investing in an Axl Rose themed burger joint called Buns n Roses.

There could be some truth in that. Someone comes up with a crazy business idea and then asks a lottery winner to invest in it and it of course loses money. Or the winner themselves has an idea for a business that doesn't work out and it goes broke. There was one who invested in a female wrestling TV show that failed and he lost a lot money as a result.

I do know most businesses fail in the first 5 years and some ideas work well while others, not so good. Everyone must be careful investing, even lottery winners.

Prisoner Six

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KY Floyd

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Jan 13, 2023, 12:05 am

"You are guaranteed to remain rich for 30 years. "

J.G. Wentworth says "Guess again."

"Or the winner themselves has an idea for a business that doesn't work out and it goes broke. "

I think a pretty good rule of thumb is that if you couldn't make living from running your own business before winning the lottery trying to do it with your lottery winnings is a bad idea. The only difference the lottery money will make is that you can lose a lot more before you have to give up.
Lotto fanatic

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Jan 13, 2023, 5:27 am

Quote: Originally posted by PrisonerSix on Jan 12, 2023
There could be some truth in that. Someone comes up with a crazy business idea and then asks a lottery winner to invest in it and it of course loses money. Or the winner themselves has an idea for a business that doesn't work out and it goes broke. There was one who invested in a female wrestling TV show that failed and he lost a lot money as a result.

I do know most businesses fail in the first 5 years and some ideas work well while others, not so good. Everyone must be careful investing, even lottery winners.

The Female Wrestling thing is something that sounds good on paper, but in actuality is a bad idea. A huge amount WWE Fans said that females wrestling is actually their least favorite part of WWE and they use that time to make a sandwich or use the bathroom. If he had invested in a strip club where only females strip, it could have been a huge success. People pay good money to watch a beautiful woman wearing nothing but a panty and bra dance suggestively and to give them lap dances. He could even have opened an all female MMA. Wrestling is staged, but MMA is 100 percent real and People pay good money to see Women beating the hell out of other women for real.
Artist77

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Jan 13, 2023, 6:02 am

Quote: Originally posted by Lotto fanatic on Jan 13, 2023
The Female Wrestling thing is something that sounds good on paper, but in actuality is a bad idea. A huge amount WWE Fans said that females wrestling is actually their least favorite part of WWE and they use that time to make a sandwich or use the bathroom. If he had invested in a strip club where only females strip, it could have been a huge success. People pay good money to watch a beautiful woman wearing nothing but a panty and bra dance suggestively and to give them lap dances. He could even have opened an all female MMA. Wrestling is staged, but MMA is 100 percent real and People pay good money to see Women beating the hell out of other women for real.

The correct term is "women" not females. Why invest in strip clubs and promote women demeaning themselves? Would you want your daughter to strip? Perhaps start a foundation to help women not to have to work in strip clubs and help them get a degree.

DO NOT BE AFRAID.

How Great Thou Art. God has blessed America.
db101

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Jan 15, 2023, 3:14 pm

Quote: Originally posted by Lotto fanatic on Jan 13, 2023
The Female Wrestling thing is something that sounds good on paper, but in actuality is a bad idea. A huge amount WWE Fans said that females wrestling is actually their least favorite part of WWE and they use that time to make a sandwich or use the bathroom. If he had invested in a strip club where only females strip, it could have been a huge success. People pay good money to watch a beautiful woman wearing nothing but a panty and bra dance suggestively and to give them lap dances. He could even have opened an all female MMA. Wrestling is staged, but MMA is 100 percent real and People pay good money to see Women beating the hell out of other women for real.

Wow how did I miss this post? What are you smoking Tasha?
db101

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Jan 15, 2023, 3:15 pm

Quote: Originally posted by cottoneyedjoe on Jan 11, 2023
I saw a video on YT that said most lottery winners go broke from investing in an Axl Rose themed burger joint called Buns n Roses.

Lol good one.
PrisonerSix

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Jan 15, 2023, 5:41 pm

Quote: Originally posted by Artist77 on Jan 13, 2023
The correct term is "women" not females. Why invest in strip clubs and promote women demeaning themselves? Would you want your daughter to strip? Perhaps start a foundation to help women not to have to work in strip clubs and help them get a degree.

Because they make money.

Prisoner Six

"I am not a number, I am a free man!"
Artist77

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Jan 15, 2023, 6:38 pm

Quote: Originally posted by PrisonerSix on Jan 15, 2023
Because they make money.

Odd to see a woman promoting women stripping. Better ways to spend jp money and not cause harm to women.

DO NOT BE AFRAID.

How Great Thou Art. God has blessed America.
PrisonerSix

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Jan 15, 2023, 7:06 pm

Quote: Originally posted by Artist77 on Jan 15, 2023
Odd to see a woman promoting women stripping. Better ways to spend jp money and not cause harm to women.

If you're referring to me, I'm not a woman. That's the problem with the 'net, you can't always tell.

Prisoner Six

"I am not a number, I am a free man!"

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