Do most lottery winners go broke?
The claim usually goes like this: 70% of lottery winners go broke within a few years. It shows up in news stories, financial advice columns, and lottery jackpot coverage, almost always credited to the National Endowment for Financial Education. In January 2018 the nonprofit said the statistic “is not backed by research from NEFE, nor can it be confirmed by the organization.” It traced the number to a participant at a 2001 think tank who said it without any verification.
The best evidence comes from studies that compare lottery winners with people who won less, since the lottery decides who gets the money at random. A study by Scott Hankins, Mark Hoekstra, and Paige Marta Skiba in The Review of Economics and Statistics in 2011 followed nearly 35,000 Florida Fantasy 5 winners from 1993 to 2002. Those who won $50,000 to $150,000 were less likely to file for bankruptcy right away than people who won small amounts, but the money delayed bankruptcy rather than preventing it. Winners who later filed had about the same assets and debts as small winners who filed.
Larger prizes look different. Swedish researchers Erik Lindqvist, Robert Östling, and David Cesarini surveyed lottery players 5 to 22 years after their wins and compared big winners with matched players who won less. In a study published in The Review of Economic Studies in 2020, they found large-prize winners reported higher life satisfaction that lasted more than a decade, mostly through feeling better about their finances. The effects on day-to-day happiness and mental health were smaller. Separate Swedish work found winners earned somewhat less afterward, which is a different thing from going broke. We covered another Swedish lottery study, on marriage and divorce.
Part of the gap between the myth and the data is what a "million-dollar" win is worth. This week a $1 million Georgia scratch-off winner took a $505,685 lump sum, and a $2 million North Carolina winner took home $864,126 after withholding. A winner who spends as if the headline number were real can run short quickly, and those are the stories that get retold.
It is also getting harder to check now. About 20 states now let winners be anonymous, either for any prize or above a set amount, according to our state-by-state guide. In 2019, at least nine did, up from five in 2015. Virginia lowered its anonymity threshold from $10 million to $1 million this July. In states that still release names, many big winners claim through trusts or LLCs, like the trust in Ohio that took $18 million from a Millionaire for Life jackpot and the law firm trusts in Massachusetts that claim prizes for clients. With fewer names public, the winners anyone can follow are a shrinking and less typical group, and the broke-winner stories can no longer be tracked for most large prize winners.
How we did this. The NEFE statement is from its January 12, 2018 release. The Florida findings are from Hankins, Hoekstra, and Skiba, "The Ticket to Easy Street? The Financial Consequences of Winning the Lottery," The Review of Economics and Statistics, vol. 93, no. 3, 2011. The Swedish well-being findings are from Lindqvist, Östling, and Cesarini, "Long-Run Effects of Lottery Wealth on Psychological Well-Being," The Review of Economic Studies, vol. 87, no. 6, 2020, also NBER Working Paper 24667. The earnings finding is from Cesarini, Lindqvist, Notowidigdo, and Östling, NBER Working Paper 21762. The 2019 anonymity count is from the Associated Press. Recent winner amounts are from state lottery releases we reported in October 2026.
Frequently Asked Questions
Is it true that 70% of lottery winners go broke?
There is no evidence for it. The National Endowment for Financial Education, often cited as the source, said in 2018 that the statistic is not backed by its research and cannot be confirmed. It traced the number to an unverified remark at a 2001 meeting.
What does research say happens to lottery winners?
A Florida study of $50,000 to $150,000 winners found the money delayed bankruptcy for people in financial trouble but did not prevent it. Swedish studies of larger prizes found winners stayed more satisfied with their lives for more than a decade.
Why is it hard to know what happens to jackpot winners?
About 20 states now let winners keep their names private, and in others, winners can often claim through a trust. In 2019, at least nine states allowed anonymity, the Associated Press reported. Fewer public names means fewer winners anyone can follow.
Paul is the Founder of Scratchcheck, he previously co-founded allkpop.com and grew it to millions of readers.
