Mega Millions winners are rich, but not THAT rich
ST. LOUIS (AP) — Congratulations, Mega Millions winners! You've just won the biggest lottery in history! Move over Bill Gates and Warren Buffett!
Not so fast, Richie Rich.
There's no doubt that you're now each a member of the 1 percent. A life of comfort and leisure awaits, and managed wisely, it just might await your friends and family for generations to come.
Let's just not get carried away.
Had you won the whole pot, and invested the $300 million conservatively, Steve Fazzari, an economics professor at Washington University in St. Louis, said you could have expected to collect a nice "salary" of about $7 million "after taxes every year for the rest of your life and the rest of the life of your heirs."
Put another way, that's $19,000 a day. Forever. And even a one-third share of that is pretty sweet. "If you put it in perspective, you're pretty rich," Fazzari said.
It's more than enough to join up with the 1 percent, which the Congressional Budget Office pegged as households with incomes that average more than about $350,000 a year.
But it's still not all THAT much, at least according those buzzkills at Forbes. Just 30 years ago, the total after-taxes take of $300 million would have been more than enough to land a single winner on the magazine's annual list of the 400 richest Americans. In 2011, you would have needed $1.05 billion to tie four others for last place on a list topped by Gates.
In fact, your $100 million isn't even two-tenths of 1 percent of Gates' estimated $61 billion net worth. Using Fazzari's math on conservative investing, the Microsoft co-founder can expect to bring in an annual salary of $1.4 billion — or 14 times your share of the historic jackpot.
But that's Bill Gates, America's richest man. Surely you'll be the richest guy on your block?
Perhaps, but not in the city centers of New York, Chicago and Los Angeles. In Chicago alone, Forbes says there are 18 billionaires, including six members of one family.
Even in a smaller city such as St. Louis, you're likely to find yourself a handful of zeros from the top: Under the Gateway Arch, the big money belongs to Enterprise Rent-A-Car's Jack Taylor and his family. They're worth an estimated $9 billion.
But none of that matters, right? So what if there are hundreds of billionaires out there whose wealth makes yours look like that of a pauper, or that there are limits you never imagined facing to a jackpot you could ever imagine winning. Surely that $100 million will at least solve all your cares and provide a lifetime of happiness.
Yeah, not so much.
"After they win the jackpot, most of them self-destruct and they end up much more unhappy than they were before," Dr. Tom Manheim, who offers financial therapy in Solana Beach, Calif. "It's really kind of a sad state of our economy where we think that money, once again is going to bring us happiness, and it doesn't."
So, uh, yeah, congratulations, we guess, to the Mega Millions winners.
(And no, those of us who didn't win aren't bitter. Not one little bit.)
RED BUD, Ill. (AP) — Three lottery tickets sold in Illinois, Kansas and Maryland hit the world record-breaking $640 million Mega Millions jackpot, lottery officials said Saturday, leaving millions of players across the country with busted multi-millionaire dreams.
Illinois' winning ticket was bought at a convenience store in the small town of Red Bud, near St. Louis, and the winner used a quick pick to select the lucky numbers, Illinois Lottery spokesman Mike Lang said. Each winning ticket was expected to be worth more than $213 million before taxes.
"It's just unbelievable. Everyone is wanting to know who it is," said Denise Metzger, manager of the Motomart where the winning ticket was sold. "All day yesterday I was selling tickets and I was hoping someone from Red Bud would win. Never in my wildest dreams did I think this. I'm just tickled pink."
Local paramedic Dan Parrott walked away from the store with only $5 in winnings after checking his $40 worth of tickets, not enough for that new house, new car and the new ambulances he'd decided would help him spend the jackpot.
"I'd love to have all that money, but with all of that money comes responsibility," he said outside the store. "But it'd still be awesome."
In Maryland, television cameras were descending on the 7-Eleven in Baltimore County where the state's winning ticket was purchased. The harried manager could only repeatedly say "No interviews" to the reporters pressing for details, and customers pushed through the media crush for their morning coffee on Saturday.
Nyeri Murphy, holding two scratch-off tickets, said she normally plays Powerball but drove to neighboring Harford County to buy $70 worth of Mega Millions tickets this week. "I should have bought them here," she said.
None of Jackie Williams' tickets won, either, but she said it was "fabulous" that a winning ticket was sold near Baltimore city.
"It's like a small town," she said. "I'll bet I'll know someone who knows the winner."
Maryland does not require lottery winners to be identified; the Mega Millions winner can claim the prize anonymously. The store will receive a $100,000 bonus for selling the winning ticket, which was purchased Friday night.
The third winning ticket was purchased in northeast Kansas, but no other information would be released by the Kansas Lottery until the winner comes forward, spokeswoman Cara S. Sloan-Ramos said.
No winner had contacted the agency by Saturday morning, Kansas Lottery Director Dennis Wilson said. "Hopefully they're seeking good advice before coming in," he said.
Kansas law also allows lottery winners to remain anonymous, though lottery winners in Illinois are identified.
The winning numbers in Friday night's drawing were 02-04-23-38-46, and the Mega Ball 23.
Maryland Lottery spokeswoman Carole Everett said the last time a ticket from the state won a major national jackpot was in 2008, when a ticket won for $24 million.
"We're thrilled," she said. "We're due and excited."
The estimated jackpot dwarfs the previous $390 million record, which was split in 2007 by two winners who bought tickets in Georgia and New Jersey.
Americans spent nearly $1.5 billion for a chance to hit the jackpot, which amounts to a $462 million lump sum and around $347 million after federal tax withholding. With the jackpot odds at 1 in 176 million, it would cost $176 million to buy up every combination. Under that scenario, the strategy would win $171 million less if your state also withholds taxes.
From coast to coast, people stood in line at retail stores Friday for one last chance at striking it rich.
Maribeth Ptak, 31, of Milwaukee, said she only buys Mega Millions tickets when the jackpot is really big and she bought one Friday at a Milwaukee grocery store. She said she'd use the money to pay off bills, including school loans, and then she'd donate a good portion to charity.
"I know the odds are really not in my favor, but why not," she said.
Sawnya Castro, 31, of Dallas, bought $50 worth of tickets at a 7-Eleven. She figured she'd use the money to create a rescue society for Great Danes, fix up her grandmother's house, and perhaps even buy a bigger one for herself.
"Not too big — I don't want that. Too much house to keep with," she said.
Willie Richards, who works for the U.S. Marshals Service at a federal courthouse in Atlanta, figured if there ever was a time to confront astronomical odds, it was when $640 million was at stake. He bought five tickets for Friday's drawing.
"When it gets as big as it is now, you'd be nuts not to play," he said. "You have to take a chance on Lady Luck."