Topic: "Most lottery winners go broke after few years" - page 2. (Read 175 times)

If you don’t have financial knowledge and self-discipline, whatever wealth you have gained, if you don’t have long term plans and goals for that, it will suddenly vanish in time, and live again with your poor lifestyle.

They say if your financial status has level up, don’t change your lifestyle but rather increase more your sources of income. Don’t grow your expenses, but rather increase your savings. Otherwise, if you follow the opposite path, you’ll see yourself embracing poverty again.

I hate to say this but this is indeed true. Not just for lottery but even for those who have turn instant millionaires from other gambling jackpot prizes. One factor I’ve seen is that, these people believe in instant money. They dream to become rich and wealthy, and so they resort into gambling, particularly lottery where prizes are extra huge.

And because of that, now that they have money, keeping it that way and even maximize generating more money seems like too hard for them. Because it becomes instant for them, then most likely losing all of them will be instant as well, especially for those people who have no skills and expertise, but just rely on waiting for their luck in gambling.

The statement is false but what you're saying is false too, statistically not everyone who bet on lottery is winning any money so they just lose whatever the amount they spend to buy the tickets and it's not going to make someone broke but if someone is obsessed and starts buying enormous amounts of tickets with the belief that they can make money are going to broke and I remember one person did that who simply buy tickets for all the money he made through wages and at the end he didn't win anything at all.

This is not just about lottery winners alone but what happens to someone in the habit of not having the idea to grow wealth. Like we have also had the stories of footballers who turned broke after their active years playing and earning big while some invested wisely.

There is also the side of getting money not planned for and in the case of lottery, I think it is always the situation because winners tend to believe they will win more and so they become carefree of what they have won. Most times they never take a break from the winning but rather increase the lottery stake.

I've heard a lot of stories about people who won the lottery or win huge amounts in gambling, then later became broke, all of the stories wouldn't be lies. Most people that hits huge amount of money unexpectedly that are not financially educated will waste the money eventually, whether it's from gambling, inheritance or gifting, they won't think of investment, they will only remember the luxury lifestyles that they never had.

Becoming rich is more easier than staying rich, if a poor person hits one million dollars unexpectedly and his immediate priority is to buy a flashy car, move up to an expensive neighborhood and begins to enjoy luxury lifestyles, before long the money will finish. If he can't sustain the lifestyle, he'll come back to poverty and will be mentally worse off than before he won the lottery. Invest huge amount of money and buy whatever you want from the ROI.

What's usually their expectations?? That 'em diggers stick to them after the gold has been exhausted? that has never happened and if anyone is having an expectation of a change on that, it'll fail. You don't spend your whole money clubbing, partying and grooving with some set of people, expecting them to have your back when you're broke... Infact, the money the cash is deposited into your account, you're automatically supposed to change your lifestyle, limiting the number of people that sees you and vice versa.

Some of them would often say "Well, I don't want my friends to feel like I was influenced by the money I got from my wins, thereby kicking them aside.... Yes!!!! Let them do whatever they want. Some false accusations is better than going broke cause your friends would do the same as well
No, you don't.

That's not entirely wrong, because from what I've seen with my own eyes, most lottery winners go bankrupt because they use their money irresponsibly and carelessly. This is because many lottery winners do not have good financial management, or environment, or bad traits that make them tend to spend their money without thinking about the long term of it. But I think it comes back to each individual, there are also those who have succeeded until now in managing the money they get from their lottery winnings.

On the moment that you do hit up lottery or simply becoming rich on an instant then the primary thing that comes up into your mind is to buy up all the things that you had wished for in the past or something that you cant afford. Primarily you will really be thinking up on purchasing a car, house and lot, tons of travels and buying useless things until the time that they have lost everything on a short period of time. They will really be having those kind of regrets on the moment or time that they will be seeing that they have slowly trying out to sell their possessions just because they dont really have more money.

It is really just that a wasteful thing if they will really be having that kind of behavior but majority of them do get blinded on the money that they have gotten. Yes, we cant be perfect but it would really be that impossible that you cant be able to find yourself having that kind of realization or awareness at least that you do really need to make use of that winning amount into more proper way and something that sustainable.

It is really that hard to control that greed on the time or moment that you will really be handing up a huge amount of money. It will really that make your extreme greed on which it might be resulting for you to play
even more or doing gambling because you are really that trying out to hit up another jackpot but in most cases you do end up on being broke.

When you lack financial management, you will end up lavishing whatever amount of money on you. This the same reason why lottery winners might get broke after some years because they didn't work hard to get the huge amount of money in their possession, and lack how to manage such huge amounts of money since it came unexpectedly, and it's their first time. It can happen to any gambler and not only lottery winners.

It is called stigma, and it is very common when comes to gambling and the effects it could have to people who do not know how to manage their own money and their own finances. I think the rumors on lottery winners being unhappy or unsuccessful after their got their lucky jackpot was rather inspired because of a handful of true stories of lottery winners and all got extrapolated from them, turning a couple of isolated cases into a urban legend, which does not have much of a scientific base to support itself.

I also like how OP pointa out rich people are rich because of they were in the right moment at the right place and in the most of the cases were born to the rich family in the first place, it did not have much to do with hard work and finance management. It is possible to become rich from investing and business creation, but it is not the norm in this world we currently live in.

I won't be surprised that a lottery winner can go broke. I have seen mighty men fall because of one or two mistakes along the line.

Some, get carried away by the wins and spend money unwisely. While few others get into a life situation that makes them spend the necessary money on medical attention and other things. I know of a friend who won huge in sports betting. At some point in life, he became very ill, and he had to fly himself all around to get cured, the pain is he did not get cured and he used 89% of all he had. Sold his house, his cars, and crumble his business just to live. RIP, Ferdy.

But am what saying here is that many things can be a reason why people get broke after winning a lottery. It's not all about them being careless or poor management of the money. No one knows tomorrow this is why we need to pray for better days.

I think this should not be about jealousy or propaganda. Anyone that wins a lottery should see it as a way of notifying them to conscious of how they spend the money won. There is probability that the lottery winner might want to waste money on other lotteries or even gambling and betting. But if such a person have it in mind that there is possibility of going broke, he can avoid what can make him regret later in life.

There are cases where the winners end up miserable. I have watched a documentary on this, and these people are exceptions to the rule. There's one story about a guy who won a lottery and thinks his money is endless and starts to spend on luxury items and is very generous to people around them. They are intoxicated with so much money that they wake up one day with nothing left. Too much money can ruin you.
A high percentage of lottery winners' are living a good life since they educate themselves on how to propely keep their money, while others want to live the life they keep on spending until there's nothing left.

Playing the lottery first and foremost is like a filter. It increases the likelihood of someone being financially illiterate. Not because it's the cause but because people that play are just probably not educated enough to know the downsides. Most lotteries have a ridiculously high so called house edge. Whereas blackjack can have a house edge of under 1% lotteries have a house edge of 50%!

For every dollar players put towards lotteries, only half of that money goes to rewards. The rest is marketing, salaries, executives level payments for companies etc. In a competitive market there could be games with more competitive edges but most lotteries are legal monopolies.

Just wanted to say, don't expect lottery winners to be geniuses in managing finances.

I read those stories of lucky lottery winners who spend like sailors every night partying and giving away money to friends. In the end, when he has no money left, he is back to being lonely again and broke. I think that was what they call sudden rich syndrome.

Now I have no reason to get jealous of those guys, I am like a lottery winner after 2017 since I won a bit good amount of money to stand on my own. But I tend to learn that these friends I have knew me to have no money, I don't have to buy them to be with me.

I want to deeply thank you OP for refuting this general belief. The media has contributed to this misconception because bad news usually has more publicity. News of a lottery winner getting broke is a good clickbait. I also wonder how some of the researchers who come up with such claims get their data and come up with conclusions. It is true that some lottery winners go broke, but the population is usually overblown. The source of the money doesn't really determine how it will be used. Well-managed or invested lottery wins will even bring more money         

Interesting research, I think it's similar like majority beliefs where gambling is bad, while it's not necessary true.

Many gamblers get addicted, but we should know that there are more gamblers aren't get addicted, instead it could improve their life since gambling is entertainment.

It's all back to the person who received the money, if they can't manage the money, they will not go anywhere and vice versa.

I think the reason why people think this way (at least me) is that someone who buys a lottery ticket is usually someone who doesn't know how to manage money anyway, or who doesn't understand math. it should seem illogical for someone who knows how to calculate statistics and earnings to buy a lottery ticket. because no matter how much money he invests, he will never win in the long run. the x dollars he invests will definitely return to him less than x. (I am ignoring the luck factor here, because that person should also ignore it).

I also agree with you about jealousy, probably no one of us has ever won the lottery and probably never will. but that doesn't mean that others haven't. people can't handle it and in a way console themselves by saying “the person who wins will probably lose their money again anyway”

Or "Most lottery winners end up being miserable"

This are both false beliefs, but somehow majority of people believe them to be true. While in reality, most lottery winners end up doing better then ever. And that they are bettering the lives of themselves and their family.

There are at least 2 psychological reasons, that i believe to be a reason, why we tend to believe the opposite:

1: Jealousy:

Winning can happen to anyone, even people who least "deserve" it. So our subconscious mind reasons it for us in a way that makes as satisfied. If we believe they should pay a price for winning, it's easier to accept our own loss. It can be partying too much, getting robbed or being betrayed by closest friends, or being miserable and lonely. If we think that there's some terrible price to pay for winning, that makes losing seem like a better option in a long run.

2. Propaganda:

We tend to believe that people who play lottery go broke because of he same reason they were broke to begin with. And that's being irresponsible with money, so they lack skills to keep the money.

This is propaganda created by rich people. We tend to believe it's all hard work and mad skillz in finances, while biggest reason for anyone getting rich is actually correct circumstances. May rich people had right people around them, and often started with financial extra boost. Or that they just were insanely lucky, buying something that ended up mooning. But rich people rarely admit this, because if being rich is part of someone's personality, they need to be proud of it. Otherwise they would have to rethink their own accomplishments.

Sure, financial skills and hard work play a part, but that doesn't mean anyone with those would get rich. There are numerous reasons for that but i will sum it up to "correct circumstances".

Stories we hear and headlines we see also fuel this belief, because those are the kind of stories being shared and getting clicks. Not the ones where winners are doing just fine, and living a comfortable quiet life.

I share just one article about this belief, even though there are probably many:
https://www.forbes.com/sites/johnjennings/2023/08/29/debunking-the-myth-the-surprising-truth-about-lottery-winners-and-life-satisfaction/