This past Friday the 13th was a lucky day for the Smith family as they stepped forward to claim their $429.6 million Powerball jackpot. Just one week earlier the eight family members had pooled their money together to purchase what would end up being the winning ticket.
The winning numbers: 5, 25, 26, 44 and 66 (with Powerball number 9) made the eight members instant millionaires. Ironically, the Smiths were not avid players, purchasing tickets only when the jackpot reached a certain threshold, said family member and spokesperson, Valerie Marie Arthur at a recent news conference.
Valerie’s mother, who purchased the winning tickets, credits “divine inspiration,” having received the numbers in a dream. The family has chosen to take a lump sum cash option of $284 million, netting each winning family member a cool $35.5 million.
But unfortunately, as history has too often illustrated, lottery winnings frequently become curses rather than blessings. According to a 2015 Camelot Group study, 44 percent of lottery winners had spent their entire earnings within five years.
Too often mo’ money, means mo’ problems. Just ask MC Hammer or the 80 percent of NFL athletes who end up broke within three years of retiring. The truth of the matter is that if you’ve made poor money decisions before coming into a large windfall, you’ll likely continue to make poor money decisions after winning the lottery, gaining an inheritance or signing a huge sports contract.
in 2001, David Lee Edwards entered a Clark’s Pump ‘n Shop and laid down $7 for lottery tickets. Later that evening he became the winner of a $27 million dollar lottery fortune. By all accounts, he should have been in financial heaven. Yet, according to the NY Daily News, high living and financial blunders found him years later bankrupt and living in a storage unit.
According to CNNMoney, lottery winner William Post hit in 1988, but the win for $16.2 million could not solve all his problems. His own brother attempted to murder him and financial excesses left him broke and divorced within eight years of striking it rich.
Bad habits and poor money management skills don’t suddenly disappear when more money enters the picture. They simply get amplified, leaving us no better off. It takes great discipline to effectively manage a huge windfall. Understanding what you don’t know and getting help in managing your newfound money are crucial.
Perhaps that’s why the Smiths will have a fighting chance of avoiding the tragic mistakes of so many lottery winners before them.
“What we did was take the initiative to educate ourselves,” explained family member Valerie Marie Arthur. Days within winning the jackpot, the Smith family has assembled a group of lawyers and financial professionals to help them manage their winnings.
“We are thrilled to meet the fortunate winners and I am extremely pleased that they heeded the recommendation to obtain professional assistance and advice to navigate this life-changing event,” Carole Hedinger, New Jersey Lottery Executive Director asserted in a recent press release.
BMWK, what would you do with $35.5 million?