Powerball Players
Did you play?
As you know, the odds were not in your favor. The Powerball jackpot jumped to $579.9 million by the time of the drawing on Wednesday, making the cash option $379.8 million, according to the Associated Press. The pot, won by two ticketholders, still wasn’t big enough to surpass March’s $656 million Mega Millions prize, the largest lottery jackpot in history.
Powerball tickets were selling at an average of 130,000 a minute, which equates to players buying 7.8 million tickets an hour, spending $15.6 million an hour for a chance at the huge jackpot, the AP reported.
Still you dreamed of cashing in big, didn’t you?
But if you still have hopes of changing your life by hitting the lottery, consider the pitfalls of fast riches from previous winners. The National Endowment for Financial Education estimates that as many as 70 percent of people who land sudden windfalls lose that money within several years, the AP reports.
“I know a lot of people who won the lottery and are broke today,” the AP quotes Sandra Hayes, 52. The former child services social worker split a $224 million Powerball jackpot with a dozen co-workers in 2006, collecting a lump sum that she said was more than $6 million after taxes. “If you’re not disciplined, you will go broke. I don’t care how much money you have.”
Here are a few examples: A two-time New Jersey lottery winner squandered her $5.4 million winnings, according to AP. Jack Whittaker of West Virginia, who was profiled in The Washington Post, won almost $315 million a decade ago on Christmas and later blamed the windfall for his granddaughter’s fatal drug overdose, his divorce, hundreds of lawsuits and his lack of true friends. Whittaker chose to take a onetime payout of $113,386,407.77, after taxes. Read the Post’s article about this rich man, poor man.
“Lottery agencies are keen to show off beaming prize-winners hugging oversize checks at celebratory news conferences, but the tales of big lottery winners who wind up in financial ruin, despair or both are increasingly common,” writes the AP.
Let’s Talk
Join me at noon ET for my online text chat with Kerry Hannon, author of my November Color of Money selection, “Great Jobs for Everyone 50+: Finding Work That Keeps You Happy and Healthy…and Pays the Bills.” Here’s the link for a review of Hannon’s book.
Be sure to send your questions in early or read the archives later.
Family Financial Fights
Mix finances and family, and the results are complicated, often leaving somebody angry or feeling taken advantage of.
But I’m here to help. If you have some family financial drama going on, perhaps I can offer some advice on how to work through your issues -- or avoid them all together.
Send your Family Financial Fight stories to colorofmoney@washpost.com. Be sure to include your full name, city and state and put “Family Finance” in the subject line.
Could the Mortgage Interest Tax Break Be on the Brink?
The mortgage interest deduction that so many homeowners enjoy could be on the chopping block as lawmakers try to find a way to avoid the dreaded “fiscal cliff” -- automatic spending cuts and tax increases set to take effect Jan. 1.
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