Steve Medland’s Article Published in California Business Journal

Steve Medland was published in California Business Journal, which writes and publishes insightful, in-depth, and captivating business articles on entrepreneurs, startups, and small businesses.

In the article, Steve says:

In October 2005, Lara and Roger Griffith bought a lottery ticket and won the equivalent of $3.6 million in today’s dollars. Roger worked as an information technology manager, and Lara was a performing arts teacher at a local college. While both were well-educated, neither of them had any idea how to manage such a large sum of money.

In an interview published in the Daily Mail years later, Lara said, “We were so desperate not to mess it up, and it’s very difficult when you have advisers coming to you in their shiny suits and flashy cars saying, ‘I’ll look after you, trust me.’ Who do you trust?”

She then added, “We were told not to put all our eggs in one basket, so we decided to invest in property and business. We thought we were doing everything right.” They invested in two rental properties, the stock market, and a beauty salon.

However, after Roger quit his job, they bought their dream home for about $1.6 million, along with a brand-new convertible Porsche and a Lexus SUV. They enrolled their two daughters in private school at a combined cost of $40,000 per year. They also started going on shopping sprees for jewelry and designer clothes, and they embarked on lavish first-class vacations to Dubai, Monaco, and Rome.

The Results of Poor Planning

Five years later, in 2010, as the economy was just starting to recover from the global financial crisis, their beauty salon was still hemorrhaging money. Then, their dream home was devastated by a fire. Because they were underinsured, they had to pay for temporary accommodations for the seven months it took to repair it.

Their unfortunate investment decisions, overspending, and failure to manage risk resulted in them losing every penny of the $3.6 million within six years.

In many of the “riches to rags” lottery stories we hear, we often assume that the people who lose their lottery winnings are unsophisticated or uneducated. However, this story illustrates how anyone is vulnerable to those losses.

Lara and Roger were intelligent, were educated, and were (at least initially) sincerely committed to making the money last. They should have been set for life. How could a couple with all of those advantages fail so spectacularly after receiving such a windfall?

The Obstacles To Financial Success

This leads us to the larger question: if we all say we want financial success, why do so few of us ever actually achieve it?

Read the rest of the article posted in the California Business Journal.