Feeling blue about losing $656 million Mega Millions jackpot lottery? Cheer up. Behind the lottery frenzy and hoopla, I’ve seen enough miserable winners over the years to conclude this: If you’re not prepared to handle the pitfalls that follow a
Feeling blue about losing $656 million Mega Millions jackpot lottery? Cheer up. Behind the lottery frenzy and hoopla, I’ve seen enough miserable winners over the years to conclude this: If you’re not prepared to handle the pitfalls that follow a sudden windfall, you’re probably better off without it.
First, if you become a winner you should be prepared to gain a lot of new friends and lose others, especially if you chipped in with a group to buy the winning ticket. Witness the McDonald’s employee in Maryland who claimed to hold a winning Mega Millions ticket as an individual, the New York Post reported, even though she also bought tickets for several other people as part of a restaurant pool. If true, she could be the latest of many targets in group lottery lawsuits.
Advice: If you play with friends, keep careful records. As filmmaker Samuel Goldwyn is said somewhat inaccurately to have said, an oral contract is not worth the paper it’s written on.
Another hazard: impulse buying. One legendary case was the late William “Bud” Post III, who died six years ago at age 66. He won $16.2 million in the Pennsylvania Lottery in 1988. Within three months, according to an obituary in the Washington Post, he was $500,000 in debt after buying a liquor license, a lease on a Florida restaurant for his brother and sister, a used-car lot and its fleet for another brother and a twin-engine plane, although he did not have a pilot’s license.
Along the way, a brother tried to hire a contract murderer to kill him and his sixth wife; a landlady forced him to give her one-third of the jackpot, and he was convicted for assault at his dream house in northwestern Pennsylvania after he fired a shotgun at a debt collector. He went bankrupt, came out of it with only $1 million free and clear, and reportedly spent most of that, too. Message: Invest wisely.
Excessive generosity also can be a hazard, judging by the widely reported story of Janite Lee, a Korean immigrant who won $18 million from the Missouri Lottery in 1993. She generously doled out many dollars to educational programs, community services and political organizations, and dined with President Bill Clinton, among other VIPs. Alas, in 2001 she filed for bankruptcy and was reportedly left with only $700 in her bank account. Sad.
So is another affliction commonly called “affluenza,” the lonely feelings of worthlessness and dissatisfaction that come, even after you already have become quite wealthy, from always wanting “a little bit more.”
That’s how Richard Watts, who manages the fortunes of some of the country’s wealthiest families, describes the syndrome in his new book, “Fables of Fortune: What Rich People Have That You Don’t Want.” Unlike many of his fellow Harvard Business School grads, the California lawyer decided not to write a book about how to make money but about how to keep your sanity while living with it.
The biggest tragedy of the rich, he told me during a visit to Washington, falls on children, who, because of their parent’s well-intentioned over-generosity, end up being “children of entitlement,” woefully under-equipped to face the struggle and decisions of normal life. Once they reach adulthood, Watts says, “their wings have had so little strengthening, their chances of flying are limited.”
Yet if this sounds like the sort of problem you’d like to have, there are important lessons to be learned from the suddenly wealthy who managed to avoid unhappy headlines.
One, catch your breath. Take a little time to employ competent advisers and figure out what to do with the new cash sensibly. You’ll have plenty of time to blow your money later.
Second, do something nice. Some lottery winners have set up foundations to improve the lives of others. Then they maintained a very low profile to keep others, including the media, off their backs.
Also: Avoid impulse buying, which is good advice for all of us.
What’s more important than money, I realize as I grow older, is time. Time is, indeed, like money as the old saying goes. Wisely use it — or lose it.
Email Clarence Page at cpage@tribune.com.
