Get That Paper: What Lottery Winnings Do To Your Life
The combined Mega Millions and Powerball winnings have topped $2 billion. Tickets are reportedly selling at a rate of up to hundreds per minute in the 44 states (plus D.C. and the U.S. Virgin Islands) where they’re available.
It’s more than money at stake if you win. A financial windfall is life-changing, but lottery wins, in particular, are not always a reason to celebrate. Because maybe money can’t buy happiness.
But can it? Recent psychological research indicates that while money isn’t everything, not having it actually is.
“When our basic needs for adequate food, safety, health care, and shelter aren’t met, an increase in income makes a much larger difference for us than when we are relatively comfortable,” Sonja Lyubomirsky writes in Psychology Today.
Another way to put it is that money makes us happier if it keeps us from being poor. After all, those of us who have very little are more likely to be evicted from our homes, go hungry, live in a crime-ridden community, have a child drop out of school, lack the resources to obtain medical care, or be unable to manage the pain, stress, and practical demands of a disease or disability. Even a modest increase in income can alleviate or prevent many of these adverse situations.
These ideas help explain why money makes poorer people happier, but why does money have a relatively weak effect on wealthier people’s happiness? One answer is that as income rises beyond a certain level, its positive effects (e.g., the ability to fly first class or retain top-notch medical specialists) may be offset by some negative effects, like increased time pressure (e.g., longer working hours and commutes) and increased stress (e.g., holding powerful positions, anxieties about investments, and problems with overindulged children). And because wealth allows people to experience the best that life has to offer, it can reduce their capacity to savor life’s small pleasures.
Winners of the lottery face an additional set of pressures, and these issues start piling up as soon as the winning number is drawn. First, who do you tell? Sure, you may want to brag, but lottery winners are hounded by scammers and sometimes robbed or killed. Time found several winners who regretted even buying a ticket. Next, if you win, do you take the money in installments, or settle for a smaller amount up-front? And how do you handle taxes and the inevitable outreached hands that reach toward you once it becomes clear you’ve won?
Fortunately for most people reading this, odds are, we’ll never have to answer these questions.
Jay Zagorsky, Professor, Boston University Questrom School of Business; @ProfJayZ
Susan Bradley, Founder, Sudden Money Institute; expert, financial transitions planning; @SuddenMoney
For more, visit https://the1a.org.
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