What is Jeopardy?
Dear Dr. Per Cap:
Game shows look like easy money. Any advice for someone who wants to win TV cash?
Signed, Trivia Buff
Dear Trivia Buff:
The closest I’ve come to a television game show is sitting on my couch barking out answers to Wheel of Fortune in between mouthfuls of potato chips, but I do have a friend who competed on two different game shows – the mega popular and long running Jeopardy, and more recently a show on the Game Show Network called Master Minds. She’s got crazy amounts of knowledge and shared behind the scenes insights from Jeopardy.
She first explained that contestants on Jeopardy shoulder some pretty steep out-of-pocket expenses. Her episode taped in late summer but the audition process leading up to the show began months earlier with an online trivia test. She was then offered an in-person audition in a choice of cities. She chose San Francisco due to its proximity to Anchorage, AK where she lives and works for a Native led non-profit. However she had to cover all of her own travel costs for airfare, hotel, meals, and she had to take a few days off from work.
At the audition she took another trivia test and participated in a live Jeopardy game to see how well she and the other aspiring contestants performed. She left unsure but was happy when notified a few weeks later that she’d been placed in a pool of potential contestants. But it was made clear there was no guarantee she’d actually be selected to appear on Jeopardy.
She then waited a few more months for the exciting news – she’d made the cut for an upcoming episode of Jeopardy scheduled to tape in three weeks. Of course, this required another flight to the lower 48, all on her own dime, and a two night stay in L.A.
Interestingly, game shows tape multiple episodes per day so she brought several outfits to the studio, and here’s where it gets fun. She was pitted against a director of marketing and corporate relationships from Washington DC and a pharmacy student from southern California. She smoked them both, winning over $24,000 in a thrilling display of knowledge and brainpower that would make even Yoda proud.
Unfortunately, her next game wasn’t quite so amazing. She led most of the game but lost in Final Jeopardy. Although still managing to take home another $1,900 for her effort. But there was a catch. She wasn’t able to “take home” her total winnings of more than $26,000. Instead she had to wait for both shows to air almost two months later and then another three months after that before she received a check in the mail. The waiting game was part of a confidentiality agreement that stated she couldn’t utter a word about the show until it aired.
Taxes were another issue. Because she wasn’t paid until after January her earnings were reported on her following year’s tax return. She also had California state income taxes withheld from her check. Meaning she had to file a California state tax return to receive a refund. A task she wasn’t accustomed to as an Alaska resident who isn’t required to file a state tax return. But an even larger issue was the estimated federal tax she had to pay because there was no federal withholding on her winnings. She wisely paid this quickly to avoid a big tax bill later.
Interesting note – taxes can create more challenges for game show contestants who win prizes instead of cash. Because they’re required to pay income tax on the market value of prizes, some people end up having to sell their prizes just to pay the taxes.
Overall my friend did really well as a Jeopardy champion. She was able to win more than enough to cover two trips to California, pay tax on her winnings, and still had plenty leftover to pay some bills and have some fun. But she made it clear there are probably easier, less stressful ways to earn a five figure payday, and a person can’t bank on a game show as a source of income. They’re more like a fun hobby that might pay off someday.
She also shared that when auditioning for a game show you’ll often be ruled ineligible to play if you’ve appeared on a previous game show within the last year, so it’s not like a person can just bounce from show to show competing. It’s also not enough to be a walking Google search engine loaded with obscure trivia factoids. Producers are also looking for contestants with personality and charisma.
And oh yeah – she said the late Alex Trebek was just as warm and friendly in real life as he appeared on TV. Hope to see you on a game show someday too!
Funded by First Nations with support from the FINRA Investor Education Foundation, it's important to note that the content provided does not constitute professional or financial advice, and Dr. Per Cap is not a licensed investment advisor. Questions can be directed to Dr. Per Cap at [email protected].
"I sincerely hope my work inspires others as we continue to foster economic empowerment through education, innovation and self-reliance for both present and future generations.”
Shawn Spruce, Champion of Financial and Investor Education in Native Communities, Host of Native America Calling