If you love the rags-to-riches stories, then you must have heard of the “My Lottery Dream Home.”
You may have even watched all the 13 seasons of this unique HGTV series.
Unlike most shows that feature celebrity homes like the “MTV Cribs”, this HGTV show features lottery winners.
After winning the lottery, these folks contact the show to help them purchase their new home.
Unfortunately, some of these folks have ended up spending more than they had budgeted for on their new homes.
This results in some of them downgrading, selling, or abandoning their home due to high maintenance.
Lottery Winners Who Have Had to Downgrade, Sell or Relocate from Their Luxurious Homes
Here are some of the most memorable cases of contestants who have abandoned, sold, or rented their home for an extra income:
1. Michael Buinicky Sold His Home
Most folks have never won a lottery in their entire lives, but very few have won it twice.
After retiring from the military, Michael won $100,000 which was impressive. But then he won $750,000 after a few weeks. After paying taxes, he took home about $528,760 which he spent on his family.
Instead of getting his dream home, he decided to get his daughter her dream home first.
He also helped pay his son’s graduation school loan. Michael purchased a second home near his daughter’s house for himself. So he contacted David who helped him purchase one.
He was pleased with his home, but sold it in 2021 for unknown reasons and relocated.
But some folks claim that he couldn’t manage the house, so he sold the home and moved away.
2. Rick and Lorie Knudsen Downsized
The Knudsens are the most memorable couple in the show, thanks to their massive $180 million win.
The couple took a lump-sum option of about $107 million before taxes. The couple ended up purchasing a $26 million property in California, but this was not their initial plan.
A few years later, the couple told People that they planned on downsizing to about half the size of the land they had then.
Managing such a huge property can be quite expensive and by downsizing, the couple could manage their expenses.
Another reason for downsizing was that they could live with their son who had a congenital heart disease.
Also Check: Rick and Lorie Knudsen: Where Are They Now?
3. Nick Ricco Spent His Winnings in 3 Months
Unlike most of the contestants in My Lottery Dream Home, Ricco claimed to have spent his winnings within 3 months.
In fact, most of his pals claims that he is currently broke since the cash didn’t change his lifestyle.
Ricco won $650,000 and spent all the cash on 2 houses near the one he already owned.
The purchase had the potential of earning him about $90,000 per year. So he may not have lots of cash in his account but his investment has the potential of paying off in the future.
4. Nate & Dixie Don’t Live in Their Luxurious Home
Like most folks who have won the lottery, Nate and Dixie tried to keep their life private.
The couple won about $10 million a few years ago and after paying taxes, they asked the show to help them find their new home.
The couple ended up paying about $1.5 million on their new house. During the show, the couple claimed to love their new home and Nate used the rest of the cash to establish a company.
Despite owning a company, Nate still works at Olympus Executive Realty. The two got married in 2019 and are believed to still be happy together.
But rumor has it, they don’t live in luxurious homes anymore. They may have downgraded due to high maintenance costs or rented it to get an extra income.
Is My Lottery Dream Home Bankruptcies Fake?
No, the HGTV series is quite real as it features real lottery winners who are ready to spend their winnings on new homes.
So instead of showing luxurious homes in every episode, they have shown some normal homes for folks working on a lower budget.
On top of that, these couples always end up picking a home from the provided options and paying for them using their winnings.
Sure, the producers have had to do some editing, but this show features real rags-to-riches stories.
Common Reasons Why Some Lottery Winners Featured On the Show End Up Losing Their Money
So, why do some lottery winners go broke? Well, here are three common reasons:
- High maintenance: Some of these homes are quite costly and without proper planning, you may end up bankrupt. Maintaining a home with a swimming pool and an indoor basketball court can be quite costly. So, without a reliable source of income, it can become a burden in a few years.
- Lifestyle changes: A lottery win has forced some folks to go on a spending spree on jewelry, cars, and homes. Some have ended up with a lifestyle that they can’t manage resulting in them filing for bankruptcy in a few years.
- Gambling: Just because you won once it doesn’t mean that you will win again. Sure, some folks like Michael Buinicky have defied the odds and won the lottery twice, but you shouldn’t start gambling again after winning. Instead, you should invest your cash wisely before you start purchasing lottery tickets again. You may end up losing your winning while chasing another huge win with gambling.
Avoiding My Lottery Dream Home Bankruptcies
CNBC claims that over 70% of the lottery winners tend to lose their winnings in less than 5 years.
This has happened to folks who purchased their current homes in My Lottery Dream Home as well due to lifestyle changes.
As hinted above, some of these homes are quite costly to maintain and they have ended up leaving their dream homes.
To avoid facing bankruptcy, as seenin cases on My Lottery Dream Home bankruptcies above, you should do the following:
I. Set Realistic Budgets
Before featuring in My Lottery Dream Home you should first figure out how much you plan on spending.
Sure, we all want a luxurious beach house or a mansion, but if we didn’t win enough for it, we should avoid spending our entire winnings on a home.
You should consider mortgage payments, taxes, insurance, utilities costs, and maintenance fees. This means looking at more than the price of your dream home.
II. Think Long-Term
Generally, David shows the lottery winners a couple of beautiful homes that have left them speechless.
But making an emotional or impulse purchase can be quite costly in the long run. When purchasing a home, you should think of your future preferences and needs.
For instance, do you plan on having kids or pets? Do you love urban or rural settings?
Basically, you should pick a home that suits your long-term goals and lifestyle.
With proper planning and consideration of your future, you will get the best out of your investment.
III. Remember that Taxes Can Reduce the Amount Won
Before you even receive your winnings, the IRS always gets its share. All the the lottery winners featured in My Lottery Dream Home payed their taxes before receiving their winnings.
For instance, Michael won $750k but received $528,760, but it doesn’t stop there.
First-time homeowners can be surprised by the property taxes they have to pay when they purchase their new homes.
According to the Census Bureau, Americans pay a median property tax of about $2,690 annually. The property tax ranges between 0.29% and 2.47%, so you should consider the property taxes when picking your new home. You may end up paying tens of thousands in taxes every year which can become a burden in the long run.
Related Post: How Does My Lottery Dream Home Work?