Coming into large amounts of money suddenly or unexpectedly can actually be traumatic and leads to foolish decisions. To those whose financial resources are modest it may sound like a dream come true, like winning the lottery. But more often than not, these events create so much confusion that the money is squandered.

What follows is a true story. I have changed names and left out identifying details, but the important parts of the story are exactly as they were told to me. A man I’ll call Michael  was born into a low-income family who lived in a small basement apartment. His father was capable, however, and a hard worker, and over the years the family’s fortunes grew. They moved from the basement apartment to a modest bungalow, and from there to a large, pretentious house.

But there was much unhappiness in the family: the parents fought frequently and the father drank heavily. Michael left home right after high school and found his way in the world as an actor. He never had much money but he was able to support himself. He distanced himself from his family. One day his bank called him and asked him to come in. He learned from a teller that he was the beneficiary of a life insurance policy. (Michael’s father had died some time before this event.) Although the life insurance payout wasn’t a fortune—a few hundred thousand dollars—it seemed like a fortune to Michael. Strangely, he doesn’t remember being happy when he learned about his windfall.

Michael’s first thought was to rent a mansion in a town where he had signed a contract as an actor in a prestigious summer theater festival. The house became a fabulous party house: he wined and dined his friends for weeks on end, and not long after the end of the summer season all the money was gone.

I asked Michael what he learned from this experience. He shrugged his shoulders and said, “I don’t know if I learned anything.” Just a few years later he got a second windfall—equally unexpected. And the same thing happened: he spent huge amounts of money entertaining his theater friends, who were only too  glad to accept his generosity. At the end of just a few months all the money had vanished.

Michael still doesn’t understand why he blew both inheritances. Other than the sudden quality of these two windfalls he thinks it is connected with his unhappy childhood and his desire to distance himself from his family. But he isn’t sure even of that.

The details are always different, but this kind of story is depressingly common.

At least two organizations have been created to help people deal with sudden money: The Money, Meaning, and Choices Institute and Sudden Money. The first of these offers a useful brief discussion of “sudden wealth syndrome.”