Stories about lottery winners going
broke isn't exactly ground breaking
news. In fact, statistics show that
roughly 70% of all lottery winners
are broke within a few years of
receiving their jackpot. Similarly,
an estimated 70% of NFL players
and 60% of NBA players will be
broke within five years of retiring.
And while the concept of blowing
through tens of millions of dollars
may seem like an unimaginable sin
to the average non-lottery winner/
pro-athlete, it actually kind of makes sense.
Generally speaking, people who play the
lottery or end up becoming a professional athlete,
come from very low income backgrounds. These
people are not at all equipped to handle a sudden
windfall of tens of millions of dollars. Their money
management skills are non-existent and they easily
fall into a world of living way beyond their means. So,
why are we writing about former Powerball winner
David Lee Edwards? What's so special about him?
Well, the way in which David Lee Edwards ended up
dying penniless and alone after blowing through a
$27 million fortune is especially shocking.
Powerball Winner David Edwards
The first part of David Lee Edwards' rise to fame and
fortune is a rags to riches tale pulled straight out of a
movie. The story starts in the summer of 2001.
David, a 46 year high old high school dropout, had
already managed to spend 1/3 of his life behind bars
related to an armed robbery conviction 20 years
earlier. To make matters worse, David had recently
been fired from his job laying fiber optic cable. He
was dead broke and living out of his late-parent's
house in a town called Westwood, Kentucky. As if all
this wasn't bad enough, David was so broke that the
house's water had been cut off. The one bright spot
in his life was 27 year old fiance, Shawna Maddux,
but he couldn't even afford to buy her dinner at
McDonald's.
Swallowing his pride, David went to a friend and
borrowed just enough money to turn the water back
on and take Shawna out for a drink at nice hotel bar.
Feeling lucky on the way to their date, the couple
stopped at Clark's Pump-N-Shop convenience store
and bought $7 worth of Powerball tickets, on a
whim.
At the time, the Powerball had gone through 18
consecutive drawings without a winner. This allowed
the jackpot to balloon up to $280 million, the third
highest jackpot on record up to that point.
Later that same night, David and Shawna almost
died from shock when they saw heard their exact
numbers called in the Powerball drawing. David
turned out to be one of four people who chose the
correct numbers and were therefore entitled to a
$73.7 million prize. His payment options were $2.9
million per year for 25 years or a onetime payout of
$27 million. Despite what you already know about
the ending of this story, every single financial advisor
in the world will tell you that taking the lump sum is
always the better choice. That's because, in theory,
investing $27 million over 25 years will be worth
exponentially more than the annual payouts.
David and Shawna Edwards
In fact, a Palm Beach financial planner named James
Gibbs even laid out a plan for David that would have
enabled him to earn $85,000 per month in interest
for the rest of his life by following a conservative
investment plan. Gibbs put $16 million worth of the
winnings into extremely safe bonds and annuities to
preserve a good chunk of the wealth, but David
cashed them out.
When David came forward to accept his ceremonial
large check, he made the following ironic statement:
" I would like to accept it with humility. I want
this money to last, for me, for my future wife,
for my daughter and future generations. " This is
precisely when life started to go downhill.
Mansions, Jets and a Fleet of Luxury Cars
Almost immediately after winning $27 million and
proclaiming that he would spend the money wisely to
make it last for future generations, David pretty
much did the exact opposite. Before even receiving
the money, David arranged a $200,000 bank loan so
he could fly a group friends out to Las Vegas to
celebrate. He blew the entire $200,000 in six days. In
November 2001 he upgraded from a $30,000
dilapidated Kentucky house without running water to
a 6000 square foot $1.5 million mansion in a gated
community in Palm Beach Gardens, Florida. He then
proceeded to spend $1 million purchasing a fleet of
luxury cars that included a $90,000 Dodge Viper and
a $200,000 Lamborghini Diablo. He bought so many
cars that the neighbors complained to the gated
community's board of directors. Their main
complaint? He owned so many cars that their posh
community started to look like a car dealership.
David's Dodge Viper
David's other indulgences included a $600,000 to
buy Palm Springs mansion, a limo company, an
$80,000 gold watch, a $160,000 ring, a $30,000
plasma TV, three race horses and a collection of 200
replica medieval swords. And how was David going to
travel back and forth between his mansions in Florida
and California? He couldn't be expected to fly on a
commercial airline like a chump, could he? Definitely
not! So David spent $1.9 million on private Learjet.
But that's not all. Perhaps with good intentions,
David spent a whopping $4.5 million to purchase a
fiber optics installation company.
David's $1.9 Million Learjet
Shockingly, within just three months of winning the
lottery, David had spent $3 million. Within a year,
he had spent a mind boggling $12 million. This is
from a guy who a few months earlier barely had a pot
to piss in.
Unfortunately, cars, planes, jewelry, mansions and
private jets were not David's only indulgences.
Sometime along the way, he and Shawna (who was
now his wife) began abusing hardcore drugs. In
2004, Palm Beach police were called to their mansion
after Shawna stabbed David with a crack pipe during
a drug fueled rage. A year later, police were called to
the house again. This time they discovered a large
amount of cocaine, heroin, prescription pills, crack
and used syringes in the master bedroom. Both
Shawna and David had also contracted hepatitis from
using dirty needles. At one point Shawna got so bad
that David paid $80,000 for her to spend 60 days at
Passages Malibu, a plush rehab clinic in Southern
California.
David and Shawna Mugshots
Not long after this final police visit, a bank foreclosed
on the Florida house. David and Shawna moved into
a nearby rented warehouse that was being used to
store his fleet of cars. Their drug use continued and
eventually all their possessions had been sold, stolen
or re-possessed. David owed $170,000 to Bank of
America for his credit card and $50,000 to Florida for
property taxes. An early low point occurred after
David and Shawna split up and he was found living in
squalid conditions out of that very same storage unit
that was now filled with his own waste instead of
luxury cars. David checked into rehab and then was
transported right back to Westwood, Kentucky,
penniless and alone.
Penniless and alone is exactly how David died this
past week at a Kentucky Hospice. A truly shocking
and sad fall from glory even by lottery standards.
Stories like this definitely give the idea of a lottery
curse some serious validity. Is it a curse? Are these
people doomed to fail? Do you think you'd be able to
make the money last? Even after reading the tragic
story of David Lee Edwards, I bet we'd still all love
the chance to find out!
Source
www.celebritynetworth.com/articles/entertainment-articles/lottery-winner-dying-broke-isnt-news-way-guy-blew-fortune-especially-shocking/