The precious lottery. How long have you spent thinking about winning that magical multi-million dollar ticket? I’ll be honest that I’ve taken a ticket out, mostly for the luxury of thinking about what I’d do with the winnings. Buy a house? Sure! Go on vacation? Yes, please. How about doing everything that you want to do? Sounds like FIRE to me.
They say you’re more likely to drown in your bathtub or die from the wounds after falling in bed than you are of winning the jackpot lottery, but in the unlikely event you do actually win, I will hand down my hard-sought after advice to you. After you win the next jackpot, do something completely different with it: Give it to me.
An analysis of lottery winners by economists at the University of Kentucky, University of Pittsburgh and Vanderbilt University took a population of 35,000 lottery winners in Florida’s Fantasy 5 lottery found that around 5% of the group went bankrupt in five years. But with my expert advice, you won’t. Exactly 100% of experts don’t recommend giving the money to me, but the experts are also wrong.
After winning, most people don’t donate a lot of their lottery winnings. They tend to spend it on themselves, friends, and family. Comedian Mitch Hedberg relates it perfectly, “I went to a pizzeria, I ordered a slice of pizza, and the ‘guy’ gave me the smallest slice possible. If the pizza was a pie chart for what people would do if they found a million dollars, the ‘guy’ gave me the ‘donate it to charity’ slice. I would like to exchange this for the ‘keep it.’”
Just give up already: You can’t win!
A couple in New Jersey who received half of the recent record-setting $390 million jackpot in 2007 decided to keep it. Elaine and Harold Messner (the winners) received $116 million in check form. They then promptly retired from their jobs. “We feel very fortunate and blessed,” said Harold to the Associated Press. “This is that early retirement we’ve always dreamed of. Now we can do all those things we said we would do once we retired.”
The largest U.S. lottery jackpot was $656 million in 2012, with three winning tickets. A handful people have made a lot of money from the lottery, but then most of those have lost it all. William ‘Bud’ Post won $16.2 million in the Pennsylvania lottery in 1988 and then he died in 2006. He is quoted as saying, “I wish it never happened. It was totally a nightmare.” MSN reports, “A former girlfriend successfully sued him for a share of his winnings. It wasn’t his only lawsuit. A brother was arrested for hiring a hit man to kill him, hoping to inherit a share of the winnings. Other siblings pestered him until he agreed to invest in a car business and a restaurant in Sarasota, Fla., — two ventures that brought no money back and further strained his relationship with his siblings.”
Contrary to popular belief, you have a better chance of winning the lottery than being struck by lightning! For that $565 million Mega Millions, the odds were about 1 in 756 million.
The saddest part about this is that poor people are hit the hardest. I think when you are thinking about your future, the lottery should help you achieve your goals, not be the magical solution to all your problem. Financial independence is about retiring to something, not away from your life. I think that’s a big reason why people use all their money within seven years.
If you beat the odds, you still obviously can’t handle the responsibility of all that money. So, the moral of this writing is to give your money to someone who is trustworthy, someone who can spend your money wisely, and someone who will willingly take it. That person is me. So, go out to your local convenience store, put a buck down, and say, “This one’s for you, Banana Fire Guy.” Just don’t get struck by lightning.