Lucky Teen Wins $1,000 a Week ... for Life

Rant 11

lottery
Imagine being a teenager and winning the lottery. Not only that, but you get money every single week for the rest of your life. Rest of your life! That happened to Robert Salo, an 18-year-old Brooklyn high school student, who just became the youngest person ever to win the aptly-named "Win $1,000 a Week for Life" lottery game. Oh, boy, oh boy. What to do with all the cash?! A house? Maybe a mansion! A car? Robert says he'd love a Lamborghini or Ferrari, but would probably settle for a BMW. Oh, the possibilities!

Not so fast, Robert. We don't want this to turn into one of those stories about the lottery winner who quickly goes broke. So let's go over some things.

You seem like a smart lad. In fact, you and your mother said you want to spend your winnings on paying for engineering college. Good move! But that talk of a Lamborghini scares me. Maybe you were joking. I hope so.

"It feels like I'm living a dream," said Robert. Well, let's make sure this dream doesn't become a nightmare of rags to riches and quickly back to rags.

So $1,000 a week sounds like a windfall, but let's get one thing straight. It's NOT. I don't know if there's a cap on the "lifetime" payout, but if there's not, and you live another 60 years, this comes to about $2 million total. You'll get taxed on that too. A top-of-the-line Lamborghini can run around $750,000 -- or about HALF of your entire winnings. Don't go there, Robert. If you want a car like that, get a girlfriend like Kim Kardashian.

What you've got here is a little safety net. If you play your winnings right, you'll always have something in the bank to save you from Skid Row if all goes wrong. And sometimes things do go all wrong. But you will never have to worry about that, and that's a wonderful thing. What you DON'T have is so much money that you can buy expensive purchases, support other people, loan other people money, invest in anything other than well-established mutual funds.

Here's my advice: Do NOT get any big, high-interest loans with your lifetime winnings as collateral. Park your money in a balanced portfolio and a bank. Take out student loans as long as rates are low.* Pay off the loans as soon as you can after graduation. Buy a small, reasonably-priced apartment since rates are low. And get an unlisted number. Pronto.

Good luck!

What advice would you give Robert?

* School loan rates can go as low as one percent and Robert can certainly make more than that in the stock market over the long haul.


Image via Mark Tee/Flickr

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Rhond... RhondaVeggie

Is it $1000 per month or $1000 per week? You have used both phrases. If it's $1000 a month I'd tell him to get a job because that's nothing big, you'd be lucky to rent anything bigger than a studio apartment in a dodgy area for that in my area. If it's $1000 a week he will still need that job because $52K is enough to scrape by on now but by the time he's sixty it will be poverty level. it's not a windfall, it's a bit of extra cash flow that will allow him to build an easier nest egg and take a few extra vacations.

nonmember avatar Sarah

A student loan...your kidding right? That is a terrible idea. Pay for college as you go and invest the rest. Wait to make a house purchase or condo purchase until you have decided where you will be living for the long term.

Evaly... EvalynCarnate

If its $1000 per week, good for him! Where I live you could get a comfortable large house in a good part of the city close to the schools PLUS a modest car and bills. Whatever money he makes working is just icing on the cake. I'd settle for it! lol

Melis... Melissa042807

It's probably $1,000 per week. Which, if you do the math, is about $52,000 per year. Which is about what my husband makes. And lemme tell ya, we don't own a Lamby. Or even a BMW. What we do have is a comfortable modest house in the suburbs, two regular ol' cars, and just enough money left at the end of the month for us to breathe a bit. This kid needs a reality check, stat. 

Jscot... Jscott1216

It's also not actually for life. If you read the fine print it basically says til you're 75 or you die, which ever comes first. I agree he needs a job and a reality check. Hell my hubs brings home $90k a year but with bills and three kids and a home $1,000 a wk extra would be great!

easun... easunshine

My advice is to put it somewhere to collect! Take $500 of every week and stash it! Don't touch it! If this kid does it right, he could totally live off this for the rest of his life and set any kids up for a comfortable life too! I've got 3 kids and the standard bills, and we could easily live on this forever!

jalaz77 jalaz77

He needs a financial advisor because his eyes see all this cash. Wanting a Lamborghini with this money is reckless.

nonmember avatar Nigel Foster

He won $1000 a week scratch off ticket. $1000 a week will add up to $52,000 a year. He has to pay taxes so it will cut down to maybe $32,000 a year. So basically he will be getting $500 a week. They give you yearly anual checks so he will be getting $32,000 a year checks for the rest of his life until he is deceased.

Michelle Gilbert

Consult a tax attorney. $1000 a week for life is about a net of somewhere around half or less. In Brooklyn that isn't going to get him a Ford Escort and a parking space let alone a BMW.

sally... sallyjohnson48

I wouldn't mind getting paid a $1000 week. I could use all the extra money I can get. I do agree with some of the other posts, hire good <a href="http://www.utahirstaxattorneys.com">tax attorneys utah</a>. They would come in handy for that situation.

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