Lottery millionaires often go broke

By Ryan Woodard, Journal staff | Saturday, August 25, 2007

People usually picture lottery winners who win millions of dollars as being set for life.

That isn't always the case, according to Rick Kahler, president of Kahler Financial in Rapid City.

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He said the average person who wins the lottery will be back to where they started within five to seven years.

"That's what a number of different studies show," he said.

"They're going to revert to the norm. Left untreated, left un-enlightened, they're going to revert to the norm, whatever the norm is in their life."

Having large amounts of money brings about psychological issues, Kahler said, such as unconscious beliefs about their large windfall.

Those beliefs can include feeling like they don't deserve the money because they didn't earn it, and an unconscious trend to go back to what their norm is - or their old budget.

"If you unconsciously really don't think you deserve this, what are you going to do? You get rid of it so you get back to the norm," he said. "You get back to what is familiar."

Kahler said another problem is that people don't have the financial savvy to realize just how much of the money they can spend each year.

He said people who win large amounts of money and want to hold onto it need to understand the percentage they can spend and need to diversify their portfolio.

Counseling can help fight the unconscious beliefs, he said.

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