14 Jul The Truth About Winning the Lottery
You’ve probably answered this question a dozen times, and if you’re like most people, you’ve imagined that life would be a whole lot easier if you could just pay off the rest of those student loans and credit card bills, buy a new car, and take a nice vacation.
But the truth is, winning the lottery is a lot more complicated than that. It can be downright impossible to navigate the taxes and fees involved, and most lottery winners don’t realize that they aren’t actually going to receive the whole amount of money that they’ve won.
In the U.S. today, your chances of getting a winning lottery ticket are about 1 in 175 million. Despite these odds, plenty of people still play lottery games — even 68% of previous lotto winners still play every week — partly because the opportunity to “win big” is still appealing, and partly it’s an affordable way to have a little fun.
But even after you’ve won the lottery, regardless of the amount, you aren’t necessarily going to have it easy. Recent studies have found that 44% of lotto winners spend all of their winnings within five years, and about 70% end up filing for bankruptcy at some point later on.
Part of the problem is that the average American isn’t prepared to handle such large sums of money. It’s easy to forget that $100 million is still a finite amount of money, and once it’s gone, it isn’t coming back. Most lotto winners never receive help when making the complicated decision whether an annuity or a lump sum of cash is the best option for their financial situation, and the details of both options aren’t always explained thoroughly.
When you win the lottery, it doesn’t matter how you plan on spending your winnings; whether you want to open up that small business you’ve been dreaming about for years, or you want to go back to school, or you want to pay off your parents’ mortgage and credit card debt (maybe as a way to say “thank you” for letting you live in their basement after college…) — all that matters is that you’re able to use your money and invest it as you see fit.