There is no real “curse of the lottery”, but there are terrible mistakes that are made by those who win large prizes without taking the steps toward a safer, more organized and better planned future.
Everyone has horror stories of families who were already dysfunctional and who became more so after sudden acquired wealth events. There are stories of existing gambling addictions that became nightmares of gross excess at the major casinos. Some lottery winners neglected to take care of their taxes and ended up broke or in worse debt than before their good fortune arrived. Others reveled in the sudden public attention, only to fall prey to predators who get their information from reading the papers and watching the news.
In order to head off the worst of disasters, the steps toward a positive and healthy transition into wealth include getting legal and other counsel even before cashing in the ticket; getting as much privacy and security as possible; and not jumping too early into major purchases or decisions. Also, getting help with any psychological issues such as family dysfunction, over spending and feeling unable to cope will help to head off the disappointment and sense of loss that can easily come with great gains in life.
Consult with attorneys for consumer banking, wills, trusts, and estates before making any major decisions. Those attorneys can help with everything from cashing the ticket at the lottery offices to avoiding ripoffs at the banks. Good law specialists will help with the complexities of income and tax planning, real estate, philanthropy, giving money to family, and other issues.
Most of all, good attorneys love to keep their clients out of court by preventing the mistakes and disappointments that lead to legal trouble.
Security and safety is important, especially in the early months. It is not wise to let the lottery officials or the press give out any more information than the minimum required by law. Many lottery winners allow their identity, home address and other personal information to go out before realizing that there are predators, sales people and others who will call, show up at their home or find other ways to bother big lottery winners.
Planning and decision making will help the big winner to calm down and to think before acting. Many experts call for months of “doing nothing big”. That is because those months will allow the facts, complications and realities of life to be absorbed before the winner makes major purchases, big investments and other major money and personal decisions.
A lot of tragedy can be averted by paying close attention to three things: big real estate purchases, major financial investments, tax issues, and keeping all spending to a budget.
It is very easy to get into a distorted psychological concept of money: that it is endless and that no price tag is too big. If necessary, get early individual and family counseling about the way the human mind processes the concepts of money. Counseling and other advice teaches ways to avoid some of the emotional and commercial sales traps that suddenly cash rich people will fall into.
There does not have to be a “curse of the lottery”. With the best legal, personal and financial counseling; some attention to individual and family emotions and security; and working to transition slowly and surely into a life of sudden acquired wealth, a big winner can have a great life.