The Science Is In: Winning the Lottery Probably Won’t Make You Better Off
One man faced perpetual harassment after winning $315 million Powerball
Stories about the tragedies that have befallen lottery winners are so common that it’s almost a cottage industry in journalism. As the Powerball jackpot approaches a record-breaking $1.3 billion, it’s a good time to review the different ways a sudden boost in wealth can ruin a life.
In 2002, Jack Whittaker of West Virginia won $315 million in the Powerball, according to ABC. After reports spread to his hometown, he became the victim of perpetual harassment from friends, colleagues, and even strangers who wanted a piece of the winning; he was followed around and disturbed at baseball games or on visits to the bar, where he had his drink drugged one time so that the assailant could steal his briefcase.
— Gotdatgood (@IbeenOWT) July 7, 2015
Whittaker not only broke off with his friends, he attributes the death of his grand-daughter to his winning of the lottery. Whittaker said that she had been targeted by drug-dealers who knew that Whittaker had money, and one day disappeared in late 2004, her body found dumped behind a van two weeks later.
Winning the lottery can also drive a wedge between couples. In 1996, Denise Rossi won $1.3 million in the California lottery, according to the LA Times. She hid the information and divorced her husband 11 days later, and was later sued by her ex-husband for violating the state’s asset disclosure laws, which ended with a judge forcing Rossi to hand over all of her winnings to her ex-husband.
The correlation between a sudden spike in wealth and divorce is well known among divorce lawyers.”When Google went public, there was a wave of divorces. When Cisco went public there was a wave of divorces,” Palo Alto-based divorce attorney Steve Cone told the Financial Times before Facebook’s IPO. “I expect a similar wave shortly after Facebook goes public.”
Less dramatically, lottery winners often fall prey to the more banal vice of profligacy. Evelyn Basehore won $5.4 million on two lottery tickets in the 1980s. In 2012, she told the NY Post that she had gambled the winnings away, and was working two jobs and living in a trailer park.
Basehore’s fate is a common one. The National Endowment for Financial Education estimates that 70 percent of Americans who experience a sudden spike in wealth lose it within a few years, reports NBC News. A 2011 MIT study found that that those who had won “large” amounts in the lottery ($50,000 to $150,000) were just as likely to go bankrupt after a 5-year span as those who had won a “small” amount (less than $10,000).