Beating Broke

Personal Finance from the Broke Perspective

Win the Lottery? Stay Anonymous, or No?

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With the big lottery drawing over, and the winners slowly being announced, there’s some talk about some of the winners remaining anonymous.  Apparently, it’s only an option in certain states, so some have no choice.  But, if you won a major lottery, would you remain anonymous if you had the option?

Lottery Winners Barbara and Michael Ayres © by Montage Communications

In some ways, at least locally, I would think it would be nearly impossible to truly remain anonymous.  There are certain services, like financial planners, investment advisers, and even bank tellers that you’d need the use of.  And, despite the fact that most of them have some ethical requirement to keep your information confidential, it seems like word always leaks out in some way.  Eventually, anyways.  On a more national and global level, it might be a bit easier to maintain your anonymity.

I think I’d like to attempt to remain anonymous should I win a lottery.  Publicly announcing it is sure to bring an onslaught of people, businesses, and organizations to your door (figuratively and literally) looking for funds.  There’s even a chance, albeit small, that you could end up with threats of injury should you say no to a handout.  Obviously, friends and family are going to find out, and some will likely ask for money, but I’d rather deal with just a few people asking rather than half the country.

Of course, making the announcement that you’ve hit it big has it’s upsides too.  You’d be an instant celebrity of sorts.  Depending on the size of the winnings, locally for sure.  If you’d have won the Mega Millions lottery and not had to share it, you’d have likely made it onto several lists of the richest people.  Done properly, the money could be used for lots of good, and that usually draws publicity too.

What would you do?  Anonymous or not?

Invest in Yourself Instead of the Lottery

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Last week, the Mega Millions lottery reached an historic high of $640 million.  That is more money than most of us can wrap our minds around.  In the days leading up to the historic drawing, people everywhere bought tickets, some spending $20 or more on a lottery jackpot they had a 1 in 176 million chance of winning.

Put this in perspective—if you fly on one of the 25 safest airlines (based on safety records), your chances of dying in a plane crash are 1 in 10 million (Yahoo! Voices), which is 17 times greater than your chance of winning this particular lottery.  Likewise, according to the National Lightning Safety Institute, your chances of being struck by lightning are 1 in 280,000 (628 times greater than winning the Mega Millions), yet the majority of us don’t expect to be hit by lightning in our lifetime.

In the days leading up to the lottery drawing, when I expressed disbelief that some whose states do not sell Mega Millions tickets traveled out of state and waited up to six hours to buy the tickets, the romantics around me declared, “When you buy lottery tickets, you are buying the chance to dream.”  So, basically, lottery ticket buyers know they won’t win, but they pay to “dream.”

Mega Millions Lottery

I’ll dream for free, thanks.

Even if you do buy the tickets with the hope, the dream, of winning, do you really want to win?  Time and time again we hear of those who win millions and watch their lives disintegrate and sometimes tragically end.  Business Insider included the tale of 10 lottery winners who won big and lost even more.  Consider just a few of the stories:

-Jeffrey Dampier won $20 million in 1996 and he generously helped his family members buy houses and opened a gourmet popcorn restaurant to supply his family members with jobs.  Still, in 2005 he was kidnapped and murdered by his sister-in-law and her boyfriend.

-William Post won $16 million in 1988.  An old girlfriend sued him for half his winnings, and his brother hired a hit man to kill him.  Within a year he was $1 million in debt and filed bankruptcy.  He now lives on food stamps and $450 a month.

Unfortunately, these stories are not unique.  In addition to the Business Insider post, a quick web search reveals similar posts, “6 Lottery Winners Who Lost It All” and “13 Lottery Winners Who Lost Everything.”  In addition, TLC has a show called Lottery Changed My Life.  If you watch the show, you know that for the majority of winners, their lives were not changed for the better.

Many of us dream about what we would do with more money.  However, the best way to achieve the dream is not through purchasing lottery tickets for a multi-million dollar jackpot that we won’t win (even if you use the worn out argument, “somebody has to win”).  Instead, the best way to achieve that dream is through our own lives.  Dream about what you can do with your life, how you can improve it, and then set to work doing so.  That will get you infinitely further than buying a lottery ticket and paying for the right to dream.

I Won the Lottery! Almost.

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I won the lottery last week.  Almost.  Not quite, but almost.  I suppose I would have had a better chance if I still played the lottery.  I used to play the lottery off and on by myself, buying a ticket now and again, when the jackpot was several hundred million.  Then, I joined a group of people at my work that pooled our money together and bought lottery tickets with that.  Eventually, when I began listening and reading more on personal finance and then found Dave Ramsey, I quit paying the idiot tax.  Happily, I spent that $10 a month on something more worthwhile.  Like debt repayment.  And it was a good decision.  Until last week.

Last week, the group of people that I used to play the lottery with won.  Not the jackpot, but the second highest prize.  All 5 numbers without the magic ball.  $250,000.  There were 19 in the pool, and, after taxes, each will receive about $9700.  When I first heard, boy did I feel stupid.  What was I thinking?  I could have had a share of that!  Do you have any idea what $9000 could do to my finances?  It could eliminate my remaining credit card debt.  What was I thinking, dropping out of the pool?

Then, as I had more time to think about it, I came to my senses.  The odds of winning that prize were 1 in 3,900,000.  You have better luck finding a fresh lightning strike and getting struck by lightning right then and there.  Which doesn’t mean it couldn’t happen.  It did.  But, for each of those 19 very lucky people, there are thousands of people who bought a ticket and will never win.  I can’t say that I’m not still slightly jealous of the winners.  More so because of the “it could have been me” mentality than because I begrudge them the money.  Some of them truly could use it.  But, if they could use it, why are they playing the lottery.

Which is why I wasn’t playing.  I could use the money.  So, rather than spending my money on things like lottery, I was putting it to work for me.  As fate would have it, the pool that I used to play with won.  I see it, now, as a test of my financial resolve.  How many of those 19 will have spent the money on frivolous things and then be complaining in a month or two about how they have all these bills?  All while putting their money in to play the lottery, just in case lightning does strike twice?

I’ll keep plugging away at my debt.  And one day, when they’re still playing the lottery, hoping to hit it big and get rich, I’ll have made myself rich with the money I’m not spending on debt.  Now, does anyone know a good way to make my friends understand that?