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Burn Rate: Couple Goes Through $12 Million in 8 Years

Written by Gary North on October 17, 2012

A man and his wife were awarded a $20 million settlement from a company in 2004. The company’s environment gave the husband a lung disease.

The law firm got 35%. Presumably, they got the rest.

They built a $3.9 million home in Carthage, Missouri. Carthage is a small town of 14,000. Average household income is $33,000 a year. The average home price is under $85,000.

They have declared bankruptcy. They owe the contractor over $100,000. The home is now listed as worth $700,000.

Easy come, easy go.

They still owe almost $500,00 on the mortgage. They did not pay cash.

The owe a total of over $600,000.

This is a classic story of the inability of people with no money to handle big money. They were poor, then they got rich, now they are poor. It is rags-to-riches-to-rags in eight years.

When they started out poor, they had never known wealth. To stay poor all your life is better than having gotten rich, blown it, and been hurled into poverty again. The agony of “what might have been” remains. “If only, if only.”

And then there is the humiliation.

This is a reminder: poverty is a way of life. Money cannot always get you out of poverty if your way of life does not change. If money just makes it easier for you to waste your life, it does you no good.

Think “Congress.”

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14 thoughts on “Burn Rate: Couple Goes Through $12 Million in 8 Years

  1. As my father used to say, "Shirt sleeves to shirt sleeves in 3 generations"!

  2. dick Grace says:

    Those that don't earn money do not value it and as a result squander it. The second generation rich lead the third generation back into poverty. It is for this reason that everyone must work and not be given food clothing and shelter. The moocher class will never have enough, Proverbs 30:15.

  3. Probably could get welfare. They are definitely in the 47% of takers. not makers.

  4. The entitled mentality is that they are entitled to everything they can get their hands on. The fact that there is never enough is your problem not theirs. They are truly the “I want, I need” crowd. We will bankrupt our nation shortly funding all these characters, most are in the employment of the Federal Government managing the fraud, waste, abuse and mismanagement of your money while earning a 6 figure salary.

  5. Texas Chris says:

    I have a similar story.

    A woman in my area won the Texas Lotto, $4 million after taxes. She contracted with me to design a (roughly) $3 million house, which she then had built. Pretty place on 15 acres, big pool, giant garage, nice landscaping, beautiful driveway. Surrounded by run down houses and old broken down mobile homes.

    Then, property taxes kicked in, and she had to put the place up for sale. She's now broke, living in the house she had (and thankfully paid off!!) when she won the lotto, and paying taxes on the house that's still for sale. She couldn't even afford to pay the utilities and live in the new house.

  6. Texas Chris says:

    Contrast that with a retired Marine friend who inherited a fortune in gold and guns from his father. He sold some coins and bought his wife a Cadillac. That's it. Bought one car. Lives in the same paid-for house. Drives the same beat-up Chevy. Wears the same faded overalls and plaid shirts.

    Learn to live simple, and be happy with that simplicity. You'll be happy, rich or poor.

  7. The whole idea of "47%" is a farce. You do realize 18% of the "47%" are elderly, in the military, children, or the working poor? And that the other 29% do work, and still pay social security and medicare taxes, but not enough for federal income tax?

    Ignorant buffoon.

  8. If one would only LISTEN…Romney said that those people would vote for obama no matter what …and those people were not the focus of his efforts to get them to change their votes..that was absolutely correct. I am 74 and still working and paying taxes and see part of the 47% as freeloaders…welfare for generations, welfare for drug addicts and drunks, welfare for unwed mothers of multiple children, food stamps for people who abuse them and on and on…if you are so insulted it may be that you are one of these?? any reasonable person would be able to discern the difference.

  9. Just Saying says:

    Aparently money can't buy you brains, or common sense. Building a palace and not having the money to pay taxes on it, or utilities, what does that tell us?There is a reason they were poor to begin with, and it is that they cannot think ahead.

  10. I was hoping he would die of his "LUNG DISEASE" before he could spend the money…….but you KNOW they will think of some other way to rip YOU AND ME off, before he dies…..

  11. This story is not actually accurate. If you would read the original article, it was unclear just how much of the $20 million settlement this man actually got because he had to share it with other people that worked the same job. Plus, you know the attorneys took their fees right off the top, so he did not get $20 million or even $12 million. Now, having said that, it is true that he most definitely should have hired someone to teach him how to handle all this newfound wealth. He managed it poorly and has now filed bankruptcy. It, sadly, is the way of the world in this country anymore. Just take a look at the Donald – he has filed bankruptcy not once, but twice!!

  12. Hopefully you didn't have to put a lien on her house for your fee!

  13. You see it weekly. Some welfare rat hits the lottery for tens of millions, and within a couple of years, they're back on welfare.
    That's why I say that, if you took all the wealth in the country and divided it up equally among all adults (sort of like the Marxist Kenyan and the OWS leeches want to do), within a few years, 95% of the previously rich would be rich again, 95% of the poor would poor again, and the rest would form the ol' bell-shaped curve in between. One reason the rich become and remain rich is that they know how to take care of the money the have, whether earned or inherited.

  14. Scott Todd says:

    Yep- if I got a big chunk of change the first thing I'd do is pay off the house and probably fix it up a bit, but otherwise the rest would be invested.