After lottery winner Jack Whitaker, of Hurricane, West Virginia, went through a litany of problems, including the drug overdose death of his granddaughter, his wife said she wished he had torn up his record-breaking Powerball ticket.
Seems like a lot of lottery winners want to tear up the ticket.
Some don’t verbalize the thought. They just run through the money as fast as they can.
Having unlimited wealth is a dream for many people. However, I keep running into others, like 9/11 widow Kathy Trant, who consciously or subconsciously hated the idea of being rich.
What is going on?
A lot of “Big Money” misery comes from not having the necessary systems in place. The winners weren’t ready for their fifteen minutes of fame and the hangers-on who would want a piece of them.
I’ve been following the Shakespeare story closely.
He clearly did not have the education, temperament or background to handle his fortune.
Being an easy mark was how he ended up dead.
People don’t really know what to do with wealth.
Some dream of showing off or sticking it to people they don’t like. While “take this job and shove it” probably feels good for a day, revenge won’t keep you happy over the long run.
Money equals security for most people. Or, at least, it should.
One of the primary reasons that people become entrepreneurs is to keep big corporations from running their lives. They want to be responsible for their own financial destiny.
Since money is the ultimate security blanket, it seems senseless that people fritter it away. Yet, it has been said that 90 percent of people who get a lump sum do exactly that.
First is a person, like Abraham Shakespeare, who just couldn’t say no. He was the perfect mark for every con artist with a story.
Usually the person with a story isn’t a stranger. It’s family, longtime friends and newly found “romantic interests.” A lot of emotions get brought into play.
And money seems to flow out the door.
The second is having too much money all at once.
Most of the lotto winners who get in trouble are the people who took all the cash up front. If it were up to me, I wouldn’t let lottery winners take a “cash option.”
If they took the annual payments, they would learn from the mistakes with their first installment or two, and would still have 18 or 19 more chances to get it right.
Most lottery winners eventually figure things out, once the money is gone. Or when they are at the point where they wish they had “torn up the ticket.”
The government figured it out a long time ago. We don’t give people a lump sum social security check at retirement. We don’t want them to run out of the money. The same used to hold true with pension plans. People received an annuity that lasted the rest of their lives.
Today, most pensions are 401K plans. Just like the lotto winners, people are running out of retirement money while they are still alive.
When you think about it, almost all of us have our own “lotto moment.” We make decisions about money that will either give us long term security and happiness or bring on pain and regret.
Handling a lump sum wisely can be a “ticket to paradise.” Or, like Abraham Shakespeare and Powerball Jack, it can be a ticket to misery that they wish they would have torn up.
Don McNay, who lives in Richmond, Ky., is an award-winning financial columnist for Huffington Post Contributor. You can learn more about him at www.donmcnay.com.
Category: Don McNay
About the Author (Author Profile)
Don McNay, CLU, ChFC, MSFS, CSSC is the best sellling author of the book Wealth Without Wall Street: A Main Street Guide to Making Money.
McNay is an award winning financial columnist and Huffington Post Contributor.
He is the Chairman of the Board for the McNay Settlement Group (www.mcnay.com) which provides structured settlement consulting for injury victims, lottery winners, and the families of special needs children.
McNay founded Kentucky Guardianship Administrators LLC, which assists attorneys in as conservators and setting up guardianship’s. It is nationally recognized as an administrator of Qualified Settlement (468b) funds.
Don has appeared on the CBS Evening News with Katie Couric and over 100 radio and television programs.
McNay has Master’s Degrees from Vanderbilt and the American College and is in the Eastern Kentucky University Hall of Distinguished Alumni. Don is a Quarter Century member of the Million Dollar Round Table and has four professional designations in the financial services field.