Winning Big, Losing Bigger: Dumb Ways People Have Blown Their Lottery Winnings
After you win the lottery, you can make smart decisions, or you can make dumb decisions. A smart thing to do might be to put your lottery lump sum payout into a savings account to accrue interest, or perhaps invest in a new business. A dumb thing to do would be to, well, do any of the things these folks made the mistake of doing.
Donating to Political Campaigns a Bit Too Much
Donating to political campaigns isn’t a bad thing, and can be as effective a political move as voting for a candidate is. However, Janite Lee spent all her money on political donations. She won $18 million in a 1993 lottery, and after donating money to Washington University’s law school — where a reading room is named after her — and to the Democratic Party, she wound up filing for bankruptcy in 2001, less than 10 years after she won big.
Getting Too Deep Into Debt
When you win the lotto, you can choose to accept your winnings as a lottery lump sum payout, as many people do, or as a lottery annuity settlement. The latter pays out smaller, yearly lottery payments, and in an immediate annuity, can begin paying out the sum in as little as 30 days. Both the Mega Millions and the Powerball have similar annuity schedules. In the case of the Mega Millions, each succeeding payment is 5% more than the last. This is the type of payout Suzanne Mullins decided on in 1993, but she soon found herself in debt when she used her annuity’s future payments as collateral for a $200,000 loan. Eventually she sold her annuity, but didn’t pay back the debt from the loan. The lending company filed a suit against her, and won $154 million, but it was worthless, since Mullins didn’t have any assets.
Gambling the Fortune Away
Evelyn Adams’ logic wasn’t entirely flawed. She had a lucky streak going, and wanted to ride it out as long as she could. After winning the lottery twice — once in 1985, and again in 1986 — she took her $5.4 million to Atlantic city to bet on her luck. The thing is, luck runs out. She lost all her winnings, and eventually wound up living in a trailer park. If you know of any silly things people have done after winning the lottery, feel free to share in the comments.