Lottery winners who lost it all: what really happens

Jack Whittaker: a $314.9 million Powerball jackpot

In 2002, Jack Whittaker, a West Virginia construction businessman who was already wealthy, won a $314.9 million Powerball jackpot, then the largest single jackpot in US history. He gave generously to churches and charities. Over the following years, news reports described large sums of cash stolen from his vehicles and office, legal troubles and the loss of family members, including his granddaughter, who died in 2004 at 17. Whittaker later said he wished he had torn up the ticket.

Billie Bob Harrell Jr.: $31 million in Texas

Billie Bob Harrell Jr., a Texas stockroom worker, won a $31 million Lotto Texas jackpot in 1997. News accounts describe him buying property and vehicles for family and friends, giving heavily to his church and being overwhelmed by constant requests for money. Less than two years after the win, he died by suicide. His story is among the most cited examples of the pressure that sudden wealth can create.

Evelyn Adams: two jackpots, then nothing

Evelyn Adams won the New Jersey lottery twice, in 1985 and 1986, for about $5.4 million in total. She later told reporters that she lost the money to gambling, generosity and poor decisions, and ended up living in a trailer. Her case shows that even winning twice is not protection.

Abraham Shakespeare: a fortune and a betrayal

Abraham Shakespeare won about $30 million in the Florida lottery in 2006. He gave away money to many people, and in 2009 was killed by a woman who had befriended him and taken control of his finances. It is a reminder of how much risk winners face from people they trust.

Michael Carroll and Callie Rogers in the UK

In the UK, Michael Carroll won about £9.7 million in 2002 at age 19, famously spent heavily on parties and cars, and later said he had little left. Callie Rogers won about £1.9 million in 2003 at age 16, and has spoken about how the win affected her and the people around her and how much she lost. Both stories are about youth, sudden money and the lack of support.

What the research says

The viral claim that 70% of lottery winners go broke has been widely repeated and traced to a statement about "sudden wealth" in general. Researchers who have looked for evidence have not found it. Careful academic studies paint a more nuanced picture. A US study of Florida lottery winners found that large winners tended to delay bankruptcy by a few years compared with small winners but did not escape it entirely over the longer term. A large Swedish study found winners reported higher life satisfaction that persisted for years, and most kept working. Reality is mixed: many winners do fine, some do not, and the outcome depends on choices, support and circumstances.

The patterns behind the failures

• Spending faster than the money can sustain, with houses, vehicles and lifestyles that bring ongoing costs.
• Giving freely without limits and ending up with an endless queue of requests.
• Trusting the wrong people: friends, advisers or partners with their own interests.
• Publicity. Being named makes you a target for scams, lawsuits and crime.
• Poor tax planning that leaves a bill the winner cannot pay.
• Isolation and pressure without support.

Lessons that work

1. 1Stay quiet, and claim in a way that protects your privacy where the law allows.
2. 2Get independent advice from a tax adviser, a lawyer and a fee-only financial adviser.
3. 3Set aside the tax first, before spending anything.
4. 4Set a monthly income and a fixed gifting budget.
5. 5Make no big irreversible decisions for six months.
6. 6Build a small circle you trust and a simple way to say no.

Our complete guide to what to do after you win goes through each step. If you or someone you know is struggling, support is available: in the US call or text 988, elsewhere contact local emergency services or a crisis line.

What the winners who did well had in common

The common thread is structure. Structure is cheap to set up before the money arrives and very hard to build afterwards.

• They took time to decide: months, not days.
• They hired independent advisers and kept them separate.
• They set a fixed monthly income and stuck to it.
• They kept a small circle and learnt to say no.
• They kept doing something meaningful, such as work, community or family projects.
• They gave in a planned way, not on demand.

Why stories skew negative

Tragedies get reported, and quiet, ordinary successes do not. A winner who invests sensibly and lives modestly does not make a headline. That is survivorship bias in reverse: the loud failures are over-represented in what we read. The research, which looks at many winners, gives a more balanced picture than the news. The point of the cautionary stories is not that winning is bad, but that preparation matters.