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  • James Wylie

Imbalance of Winning the Lottery

Recently, there was a winner of the $1.34 BN lottery and one ticket from Illinois had the winning numbers. The thing about lottery jackpots is that it invokes dreams and fantasies of what we will do with the winnings. I know in my case, I fantasied I would get a yacht, a luxury car, and bunch of condos all over the world if I won it. Certainly it would be nice, and having these dreams takes you to that surreal world of luxury, comfort, and opulence.

But then I read that 70% of all lottery winners of huge jackpots end up broke, jail, or even commit suicide after a couple of years. Some have mentioned that they wished they never won the lottery. Should this be surprising? Not really.

One of the chapters in my book, Life Imitates Science, deals with equilibrium and how events can cause an imbalance in your life. This could be anywhere from going to college which means leaving home for the first time, getting married, having children, getting fired from a job or even getting a promotion to a management position. You are in a state of equilibrium with your life and then suddenly, it is upset.

Now one would laugh at why becoming an instant billionaire be upsetting. The key word here is instant. All of a sudden, you went from probably earning a decent living to becoming a member of the superrich, just with a simple draw of getting the winning numbers. In my book, I say that equilibrium is like running water into a bathtub and you need the same amount of outflow as you do inflow, otherwise the tub will overflow or drain down. In the case of winning the lottery, you just had a tidal wave of water dump into your tub and your first impulse is to spend it. In furthering this tub analogy, you should take this huge sum, invest it so that the level does not drop, and establish a new equilibrium. With the right investment strategy, you will have a larger tub for your holdings, larger inflow of income (assuming you made good investment choices) and of course, larger outflows to enjoy your winnings. Here, you want to preserve your capital so that it becomes a good money generator for you so you can live off of it (in comfort and even luxury).

Sadly, those 70% that lost their money, did not do that. They let the tub drain down without considering how they can elevate their lifestyle at a new equilibrium. As a side comment, I read that owning a yacht is a true luxury until I read that the average cost to maintaining and running it runs into the millions. Make sure you have enough inflows of money to cover it and don’t let your tub drain.

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