For a lot of people, winning the lottery is the American dream. But for many lottery winners, the reality is more like a nightmare. The reason for such is that people who are not used to having money (and lots of it) are fragile and vulnerable – - – and there are plenty of people out there who are willing to prey on that vulnerability — even friends and family. A lot of people who don’t have money don’t realize how much it costs to live in a big house – - – the need to pay decorators, buy furniture, pay taxes, insurance premiums, and even utility costs are greater. They jump into attractive offers, could be a nice sailboat, a shiny car or a promising investment without even checking the contract.

But you see, the reality of life after hitting a windfall isn’t nearly as rosy. But others made the right choices with how they spend their millions, and earned even more. Read related post here.

Here are few stories of those who won it, but lost it all (and perhaps even more):

Evelyn Adams, won the New Jersey lottery not just once, but twice (in 1985 and 1986), to the tune of $5.4 million. Today, the money is all gone and she lives in a trailer. When asked, she said she never learned one simple word in the English language – - – ‘No.’ Everybody wanted my money and everybody had their hand out. But she admits also being a big-time gambler. Though she didn’t drop a million dollars, but she lost a lot of money. She made mistakes, yes, and now she has nothing but regrets.

William Post won $16.2 million in the Pennsylvania lottery in 1988.  But now, he lives on his Social Security. His story is a bit different – - – a former girlfriend successfully sued him for a share of his winnings. But it didn’t end there. A brother was arrested for hiring a hit man to kill him, hoping to inherit a share of the winnings. Other siblings pestered him until he agreed to invest in a car business and a restaurant in Florida, ventures that never brought any money back and further strained his relationship with his siblings. Within a year after winning big time, he was $1 million in debt. Post admitted he was both careless and foolish, trying to please his family. He eventually declared bankruptcy. Now he lives quietly on $450 a month Social Security and food stamps.

Ken Proxmire was a machinist when he won $1 million in the Michigan lottery. He moved to California and went into the car business with his brothers. Within five years, he had filed for bankruptcy. If you ask those who know him well, Proxmire was just a poor boy who got lucky and wanted to take care of everybody. It was a hell of a good ride for some three or four years, but now he lives more simply – - – no more talk of owning a helicopter or riding in limos. Now, he is back to work as a machinist.

But just like the Brad Duke (from previous post), there were those who knew how to take their millions to a quite long, long way – - – and even gained more:

In 2007, Natalie Bostelman and her husband were working hard to keep their heads above water. She juggled several jobs, including working as an office assistant to an independent insurance broker, serving as an acting coach for children, bartending and working at a home decor store. Her husband was a project manager at an engineering firm. Yet, over the years, the two had racked up a significant amount of debt. But things changed in 2008 when Natalie won the “$1 Million Dollar SuperPrize” from Publisher Clearing House. Although she took home only $250,000 after taxes, it was enough to get the couple back on their feet. They were able to pay off their debts, move out of their trailer and into a home her husband designed. They even socked some savings away. It helped that she had clear-cut goals: to pay off their debt and build their dream home. They also assembled a team that consisted of a financial advisor and accountant to help them get there. Bostelman is still working for the insurance broker and this year she became a goodwill ambassador for the sweepstakes company.

Karen McHale was just trying to help when she bought $100 worth of raffle tickets in December 2008. A family was having trouble selling their $1.2 million home in Edgewater, Maryland so they had decided to raffle the home off for charity and McHale wanted to help. A month later, McHale was told she had won the home. Once the requests for media appearances died down, she and her husband decided to sell the 6,000 square-foot, five-bedroom home they had won. With the housing market in the cellar, they finally sold it nine months later to the Unity by the Bay church for $650,000. For McHale, it was a win-win for all involved. After paying the taxes on the sale, McHale walked away with $200,000 in November 2009. It was just in the nick of time. She had been laid off as regional manager selling equipment to water/wastewater facilities. Thanks to her winnings, McHale, a volunteer firefighter, has a new lease on life. She and her husband took $50,000 and bought a new truck and paid off some debts. The rest they saved.

Anthony Broccoli has been lucky all his life. The owner of Brock’s Collision Center & Auto Repair shop in Warwick, Rhode Island, plays the lottery a lot and he wins a lot. In 2009 alone, he had about $13,000 in winnings. Still, he doesn’t let his lucky streak go to his head. Even after winning a $1 million jackpot from the Rhode Island lottery in 2008, the 49 year old continues to work, as does his wife. His only splurge: a Camaro, after a year of thinking about it. Even after getting hold with piled of money, they couple went on like they never had it. They paid their kids’ colleges, the taxes, and everything else they see necessary. Broccoli believes that if you can’t pay for it, you shouldn’t buy it. He also relies on advice from his accountant.

So, these are just among the happy endings and the sad-but-true tales – - – both of which, are not uncommon. For many people, sudden money can cause disaster and going broke is a common malady, particularly with the smaller winners. Say you’ve won $1 million. Each winner takes a picture with a check that becomes a 3-foot by 5-foot stand-up card. The winner is photographed and shown all over the papers with a caption that reads: ‘America’s newest millionaire.’ But what they’ve really won is a promise to be paid $50,000 a year. People win and they think they’re millionaires (sadly that is never the case).

As you can’t avoid the world finding out about you, in a short while, you’re going to have more friends and relatives than you ever knew. And what problems to have: Taxes, greedy relatives and friends, expensive decisions, and, possibly worst of all, yourself.

Great wealth brought on all of the sudden to somebody unprepared is going to bring trouble as many would agree: sudden money has a dark side. It changes what you can do, what you no longer have to do, where you can live, how much you can travel. So much changes so fast that it can be terribly overwhelming, and some people go into money shock. (Still, many would like to experience the ‘money shock’). People with swift fortunes are most vulnerable to not knowing what to do with it. The money will be thrust upon you and so will a multitude of requests and decisions.

Get a financial advisor you trust. The problem with most people, they start thinking of what they will buy even before they got their hands on their winnings. In fact, to manage your money well, even when you have it, don’t spend it like you already have it. Figure out what your responsibilities are, including what you owe in taxes. A good financial and legal adviser can always help. They can provide a buffer to all the requests and wild ideas you’ll be hearing for the rest of your life, protect you from yourself by advising you ways to manage the millions and even help you turn your new money into even more money! Financial advisers can inform you and guide you into trust funds, endowments, charitable remainder trusts, family limited partnership and more. They know the ins and outs of money – - – that’s what they’re here for.

Sudden loss and sudden wealth have quite a bit in common. Practical measures that re helpful whether you’ve suddenly hit the jackpot or lost it all include Taking a timeout – - – park your money and don’t make any major decisions about your finances until you have overcome the excitement of having the money. That allows time to get one’s bearings and make plans. Also, you should get organized. While it’s not a time to make decisions, you need to figure out what the decisions will be. Go through your assets and debts; pay any taxes and high-interest debt. Review your insurance coverage. Think about how you’re going to live while you’re in this planning stage. Also know your priorities. Keep asking yourself questions about what you want to do, how you want to live, and what is important to you. Do you want to live in a cabin in Montana? Do you want to pay for all your children’s educations? Do you want to engage in more philanthropy? And you might just not realize the importance of it, but assembling a financial team helps – - – a lot. Enlist the help of an adviser. For the suddenly wealthy, that can mean an accountant, a financial planner, an investment adviser and an estate attorney.

For some people, it’s smart to make financial decisions even before you get your hands on the money. Suddenly rich or suddenly poor – - – it doesn’t make that much difference when speaking of the need to make financial decisions.