The tragedy of instant money.

Although not identical to what happens to large injury award victims, todays NY Times has a compelling article on what one family went through after winning the powerball lottery, and being set up for life financially.

Anyone who works in the settlement planning profession knows story after story such as this, where the inability to manage money and the pressure it brings on people, ultimately ruins them and creates greater problems then they had prior to their award.

While we aren't able to save people from themselves, the fact that a structured income stream, with proper planning would have required people such as this to live with in their means and not just go wild, might have saved them a lot of misery and ultimately prolonged their lives. What i've found over the years is that if you can get a client through the first 36 months of an award with out making any financially disastrous decisions, you have a very good shot of long term success in dealing with their planning. The worst thing is for someone to take a large lump sum because the pressure to spend, to deal with creditor and others is more then most can handle and the downward spiral begins.

Intriguing, but depressing, reading in today's NY Times.

Posted on December 5, 2005 .