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Where did the money go?

Steven says the $1 million prize advertised on his winning scratch ticket didn’t represent the real value, which was apparently $766,000. After taxes, he was left with just $555,000.

Taxes, however, were only part of the problem for Steven. Much of his newfound wealth was spent the same way it was created: gambling.

“I gambled to buy the ticket, right? That never stopped,” he said.

Steven diversified into other forms of gambling, including sports betting and casino games. He embarrassingly admitted his gambling became a problem.

Gambling disorder is a diagnosable, chronic mental health disorder that has serious implications for those who suffer from it. According to the National Council on Problem Gaming, 4-to-6 million Americans are considered to have a mild or moderate gambling problem, while an estimated 2 million meet the criteria for a severe gambling problem.

Addiction experts worry the problem could potentially escalate as sports betting has become legal in more states in recent years and the industry’s revenue continues to expand at a steady pace, according to data published by American Gaming Association.

Steven says he has already reached out for help from Gamblers Anonymous, a fellowship that supports men and women with gambling addictions. However, the gambling has taken a toll on his personal finances. He says he has just $6,000 left in his bank account and $29,000 in outstanding debt from federal student loans.

Fortunately, show hosts George Kamel and Ken Coleman see a viable path out of this situation, potentially within a year.

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1-year debt plan

Steven says he upgraded his lifestyle only "a little bit" after winning the lottery — paying for a new car in cash — and he used some of his windfall to pay down debt. He earns $75,000 a year working as a restaurant manager, which he says allows him to save $2,400 in excess cash every month. He believes it can be used to pay off his $29,000 debt within 15 or 16 months.

Kamel encouraged him to do that and then focus on accumulating a few months of living expenses into an emergency fund. Coleman, meanwhile, told Steven his biggest challenge was overcoming his gambling and encouraged him to reach out to friends and loved ones who might hold him accountable, as well as expert help to aid with the change.

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About the Author

Vishesh Raisinghani

Vishesh Raisinghani

Freelance Writer

Vishesh Raisinghani is a freelance contributor at MoneyWise. He has been writing about financial markets and economics since 2014 - having covered family offices, private equity, real estate, cryptocurrencies, and tech stocks over that period. His work has appeared in Seeking Alpha, Motley Fool Canada, Motley Fool UK, Mergers & Acquisitions, National Post, Financial Post, and Yahoo Canada.

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