Winning the Powerball prize may be next to impossible, but that hasn’t stopped people from purchasing hundreds of millions of tickets across the U.S. this week. The billion-dollar-plus jackpot has exceeded all records, causing even the most rational people to get in on the action.

People like Jeremy Morgan, for example. The married father of two based in Denver has done the math: He built an elaborate and precise excel model to calculate the odds and the expected value of each lottery ticket. For every $2 he spends, Morgan calculates his return will be negative 35 percent, according to the most recent numbers.

“Being a math geek in general, it was fun to look up the numbers," Morgan said. "I’ve never won more than maybe $2 on a lottery ticket, so I’m definitely cursed with bad luck, but I still play. I know all the math, and I still play." 

“I think, like a lot of people, that it’s worth the $5 or $10 just to think about what the heck you would do with that amount of money if you were to win,” he added. "It’s a fun conversation starter."

Of course, someone will win the lottery; and when that happens, his or her entire life will change in an instant.

Susan Bradley, founder of the Sudden Money Institute, trains financial advisors on how to help someone who has come into a large amount of money, commonly referred to as a windfall. Bradley says there are many life transitions that might lead to a windfall: inheritance, divorce or selling a business. Winning the lottery is another — less common — example, and it's likely more dramatic.

“One minute you're this, and the next minute you’re that. It literally changes in a minute,” said Bradley. “I don’t believe one can be prepared for it. I know lots of people fantasize about it, but it doesn’t feel the way you think it’s going to feel. And it doesn’t go away.”

One recent lottery winner told her the experience was like being catapulted from his backyard in the Midwest to the middle of Times Square in New York City. And then finding out he could never go home again. 504689876 A customer holds Powerball tickets that he purchased in San Lorenzo, California. Photo: justin sullivan/getty images

Becoming Instantly and Publicly Wealthy

Lottery winners are distinct from others who become wealthy because the process is public and immediate. “It’s not like someone who invented something and made a lot of money or built a business, because you are on an equal playing field with everybody,” she said. Since everyone has an equal chance of winning, she said, “Everyone feels more entitled to watch or take a shot at you. There’s a lot of bias."

The jackpot crossed the $1.5 billion mark Tuesday, with a $930 million lump sum payout before taxes. If there’s only one winner, that person will likely pocket somewhere around half a billion dollars. Talk about surreal.

Even though that’s less than the $1.5 billion prize, the winner could theoretically become a billionaire if they invest wisely. There's a simple formula to calculate how long it will take to double your money, called the 'Rule of 72': Divide 72 by the rate of compound interest you can expect to earn overtime. The answer is the number of years until your money is worth twice as much as it is now. Using a conservative 3 percent rate of return, about the rate of inflation, a prudent lottery winner could make it onto the Forbes billionaire list within 24 years, or by the year 2040.

According to Forbes, there are currently 1,615 billionaires who live in the United States. The list includes the source of the individual’s wealth, with examples such as tech companies, candy empires and hedge fund fortunes. The Powerball winner would be the first person to have “gambling” listed as their source of wealth.

As a registered player financial advisor with the NFL, Ryan Losi helps individuals manage newfound wealth. Although money provides security and freedom, he says it can also magnify issues that already existed.

“So you have millions or hundreds of millions, you still need to find something that gives you purpose in life. Otherwise you’re going to be unhappy, which will lead to making bad decisions,” Losi said.

Morgan, who is CEO of the restaurant chain Tava Kitchen, says he wouldn’t quit his job if he won the lottery. “I’m running a small business now, so [the money] would provide some additional flexibility in lifestyle, but I love what I’m doing,” he said. “Even though I’m an entrepreneur, I’m a pretty practical person at heart. I would probably save an awful lot of it, make sure my family is taken care of and come up with a plan for giving a lot of it away,” he added.

Lottery Winners Face Challenges

Losi cautions that Morgan's plan may be easier said than done: “It’s very important to seek an attorney and a CPA because there’s going to be both financial and legal issues that they need to consider in a short period of time,” said Losi, who is also a certified public accountant and executive vice president at the accounting firm PIASCIK. He recommends setting aside extra money for the tax bill, which will exceed the government withholdings on the winnings, as well as considering an irrevocable trust to manage liability and future income.

Federal taxes on the Powerball winnings will be about 40%, but the government only withholds 25% of the initial payout. For every $1 million you win, that’s a $150,000 difference, Losi said. “Whether it’s a lump sum or whether it’s periodic payments, there will be a large payment due the following April 15. Those are usually first-year surprises,” he said.

Lottery winners have 60 days before they have to determine how they want to receive the money, and Bradley says it’s worth taking that time to think before deciding. “Getting out of town is a good thing. It’s hard to keep a low profile when you’re about to be $100 million plus richer. The idea is to go someplace where you can start to catch your breath,” she said.

Setting up the right financial team is important, and Bradley emphasizes the importance of finding an advisor who has experience working with individuals who have received windfalls. Simply depositing hundreds of millions of dollars into your checking account will not protect you against being pounced on by every financial sales person at your bank.

“If you happen to come into this kind of windfall, you have to be willing to say no because there’s going to be a lot of people who will be asking you to say yes,” Losi said.

Despite gaining financial security beyond measure, the Powerball winner will have new challenges to navigate. Bradley says there is a tendency to withdraw, and most people don’t sleep well initially. Relationships suffer for many people who come into a windfall, so it’s important to maintain strong connections with loved ones, especially during the difficult transition period. Bradley estimates it takes five years or more to adapt to the new normal that a windfall imposes.

If the winner has a family, the new wealth will have a ripple effect. Morgan says he and his wife would purchase a larger home and new cars, but his biggest concern would be maintaining a sense of normalcy for his two children.

“I did tell my daughter she wouldn’t have to go to daycare anymore if we won. So she was happy about that,” he said.