Your Lottery Winnings Could Become Someone's Loan

By Serena Elavia Industries

A couple purchases items from a newsstand selling Powerball lottery tickets in Times Square, New York January 12, 2016. The Powerball Jackpot has reached a record $1.5 billion. REUTERS/Adrees Latif - RTX223XR

Winning the lottery has a bigger effect on the economy then you might think. According to research from the University of Texas McCombs School of Business, when Powerball and Mega Millions winners deposit their funds, the lucky bank recipients see an increase in deposits and lending.

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Lottery winners’ deposits lead to just over a four percent increase in bank deposits and almost a 4.3 percent change in small business lending. However, the research found that depositing lottery sized funds does not increase the probability of lending. Instead, it increases the amount of lending to small businesses and therefore, the growth in lending is to current borrowers, not new clients.

With today’s Powerball ringing in at $1.5 billion, the highest ever, it’s likely that these funds could spur a hefty amount of loans.

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