All you know about the fate of the lottery winners is probably wrong

Friday's Mega Millions jackpot hit a record $ 970 million. Saturday, Powerball will hold a draw for a $ 430 million jackpot. According to a study published in May, a winning ticket for either lottery will change lives, but some of the popular theories about the fate of the winners are not necessarily accurate.

The study, published by the National Bureau of Economic Research, examined 3,362 Swedish lottery winners with a score of at least $ 100,000, and asked them what their well-being was between five and 22 years after touching the jackpot.

The study was conducted in Sweden and the lottery prizes were not millions, but New York University economics professor Daniel Cesarini, co-author of the study, said that he did not think that the results would be very different. study Americans who have won multi-million dollar awards.

"The prices for Mega Millions are far more important than anything we've studied. We looked at people who earned up to $ 2 million, "he said. "I'm sure the people who win much bigger prizes are struggling with some of the challenges you would not face if you won a million dollars."

Cesarini also believes that his work with Swedish lottery winners will probably be widely applicable. He says that a different study of American lottery winners showed similar reactions to his findings.

"It's hard to say if the results would be different if we conducted the study in America," he said. "I guess the results would not be radically different. In the United States, for example, in the field of health care, money could help in different ways, but I would not be shocked if someone led a similar study in the United States and ended up overall similar conclusions, but there are some reasons to expect in some respects, the results may differ. "

Here are some misconceptions about the winners of the lottery that the study of Cesarini seems to refute.

People who win big lottery jackpots blow up their money in a few years

Cesarini tells TIME that a common misconception is that the more a person wins the lottery, the more likely they are to spend everything.

An anecdote often quoted – but erroneous – about the lottery winners falsely attributed to the National Endowment for Financial Education claims that about 70% of people who suddenly receive a cash gain will lose it in a few years. In January 2018, the National Endowment for Financial Education corrected the facts by stating that their research does not confirm the statistics.

Examples of the "curse of the lottery" abound – from the West Virginia man whose daughter and granddaughter died of an overdose after earning $ 315 million in 2002, at the same time. A man from Kentucky who claimed a prize of $ 21 million in 2001 and lost everything in 2006.

Cesarini said he and fellow researchers discovered that lottery winners who earned larger sums of up to $ 2 million kept their wealth more than a decade after the jackpot.

"We saw that people who earned large sums of money were even richer 10 years after the fact, compared to those who earned small sums of money," he says. "In addition, if you look at the labor supply, for example, people who earn a lot of money reduce their work, but it's pretty rare that they stop smoking. They reduced their spending mainly in the form of longer vacations. "

Cesarini says that people expect many winners to immediately waste their wealth, but that is rare.

He adds, "What we see regularly is that they work a little less, but they spend the money smart enough. But that does not mean that no one has struggled with the problems of self-control and the use of money in ways that do not serve his interests. But I think their behavior is much more governed than you think if you read popular stories about what's going on. "

All this money makes people unhappy later in life

The researchers found that the happiness and mental health of people who earned at least $ 100,000 in the lottery had not changed much, but contrary to popular belief, there was no evidence that it made participants less happy.

Overall, the money earned led to positive long-term satisfaction, and the researchers found that there was a link between financial satisfaction and overall long-term satisfaction.

"Grand prize winners are experiencing a sustained increase in overall life satisfaction, which has been going on for more than a decade and shows no signs of disappearing over time," the study says.

People who win the lottery are happier every day

The researchers in this study measured their satisfaction with life by asking participants about the quality of their life in general. Happiness was measured by asking questions about everyday feelings.

Cesarini said that to study happiness, the researchers asked questions like "Do you smile a lot?" "Do you laugh a lot?" Or "Do you feel happy today?

Winning the lottery did not seem to change happiness in general.

The satisfaction of life made the difference. The researchers were able to ask questions such as, "How happy are you with your family and friends?" Or "How happy are you with your finances?

"We asked people what was the satisfaction of life, an evaluation measure, and that's where we found the most important effects of lottery wealth," said Cesarini. "We also asked about their happiness.For happiness, we found that there was no solid evidence that lottery winners were happier in the long run, but there is strong evidence that they are more satisfied with their lives in the long run. "