Lottery Winners Struggle To Keep Their Prize Money

It is a common pattern that most lottery winners struggle to keep their prizes responsibly. According to Reader’s Digest, most lose all their winnings, and 70% of them run through it in five years or less. Winners treat the income they have won differently from hard-earned cash. This behavior is called “mental accounting,” and it affects how people think about their income.

Even though cash has the same intrinsic value, people tend to spend won earnings frivolously compared to finances earned at a regular job. Somehow, they view these funds as “free,” which explains why all lotto winners behave similarly.