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Windfall not always a blessing, psychologists say

With a lottery ticket, Geraldine Williams went from being a cleaning woman to a multimillionaire. You'd think her problems were solved, but professors who study those whose fortunes change in a heartbeat say that pitfalls could lie ahead.

Psychologists who specialize in what has been dubbed "sudden wealth syndrome" said that impulse buying and social isolation often accompany a large windfall.

"I've not talked to anyone who is just totally enthralled with the winnings that they have and just perfectly happy," said Dr. Steven J. Danish, professor of psychology at Virginia Commonwealth University in Richmond.

Danish has counseled lottery winners for more than 12 years, and almost all his patients have had serious problems after collecting their winnings. After the initial shock passes, a sense of guilt often arrives, along with the hoards of people asking for money. Giving or leaving money to family -- including mysterious, long-lost relatives -- is often the biggest source of stress, he said.

However, there are lottery winners who take their money and use a reasoned approach to achieving a common goal of providing for family and community. That was achieved by Pat and Erwin Wales of Maine after the couple won $73.7 million in the national Powerball lottery. Just 13 days after winning, they established a nonprofit, Narragansett Number One Foundation, to improve the lives of people in Maine.

"They've maintained a very low profile," said Terrence Garmey, their former lawyer. "They're the same people they were, except they drive nicer cars and live in a nicer house."

The couple accomplished this in part by making a point of avoiding media attention, he said.

Still, the pressure that comes with sudden wealth forced at least one winner among Danish's patients to shift from a small town to social isolation.

"They bought a place that was bigger than they were used to living in, and all the people around them had a different lifestyle," Danish said. "They felt very much like they were alone. . . . It's kind of like the Beverly Hillbillies, but at least the Beverly Hillbillies had each other."

Though winners of large lottery jackpots often experience sudden wealth syndrome, those who study the effects have also looked at dot-com multimillionaires whose financial lives changed dramatically during the boom years of high technology. Lottery winners often have the urge to uproot their lives and move to a nicer setting, but that is exactly the type of sudden change specialists advise against.

"Don't change too many things right away," said Dr. Daniel L. Kegan, an organizational psychologist with Elan Associates, a consulting firm.

By taking time to figure out what to do with the money and employing competent advisers, winners can minimize the common problems of loneliness and depression while avoiding blowing the money right away.

"All of a sudden, that person takes on immense importance and value to everyone around her," said Dr. Stephen Goldbart, codirector of the Money, Meaning, and Choices Institute. "She'll be queen of the hill and have everyone on the planet wanting something from her."

Goldbart's institute specializes in sudden wealth syndrome, a term he coined, and sees everyone from heirs to the success stories of Silicon Valley. Goldbart said that lottery winners are particularly prone to impulse buying because they have no previous ties to the money they have won, as opposed to those who gain large sums though salaries.

Globe correspondent Carolyn Y. Johnson contributed to this report. Jessica T. Lee can be reached at jtlee@globe.com.

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