7 hard to believe facts about Lotteries and jackpots

Who would not want to win a lottery jackpot? It’s definitely a fun thing to dream about, to imagine what you would do with all that money. After are some jackpots really large, offering hundreds of millions of dollars – and a few even have a peak one billion dollars. Winning a jackpot would also take care of our retirement.

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7 hard to believe facts about Lotteries and jackpots

But keep those horses. If, deep down, we know that lotteries are not the big money makers for the vast majority of us that we might want them to be. Here are seven things to know about Lotteries and jackpots.

No. 1: You can probably win more than you think

Sure, you know that you are not likely to win a lottery jackpot. But when you buy tickets, you probably just don’t realize it how unlikely it is. For example, the chances of winning the Powerball Prize are 1 in 292,201,338 – yup, that’s more than 292 million. It’s even worse for Mega Millions: the odds of their big payout are 1 in 302,575,350. There are about 330 million people in America, so the chances are not that different than if you just selected one random one in America.

It’s fun, though discouraging, to see what kinds of things are more likely to happen to you than winning the lotto jackpot. For example, you are more likely to be bitten by a shark: Those chances are 1 in 11.5 million, according to the University of Florida’s International Shark Attack File. You also have more likely identical quadruplets, with the chances of that estimated at 1 in 15 million.

No. 2: Playing all possible numbers could still yield a loss

Here’s a mindbender: In many cases, if you buy enough cards to play every possible number combination, you will end up spending more than the lottery jackpot pays. With Mega Millions, for example, there are 302 million different combinations of numbers that you could play – at $ 2 per ticket. That amounts to about $ 604 million – for a jackpot that is normally significantly less than that.

Nr. 3: Our brains can trick us into buying tickets

Lotteries are a tax called for those who are bad at math. But a lot of the time, we end up buying lottery tickets because our brains are tricked.

We see prize winners – and not losers – who may think that winning is more likely than it is. We humans are also often too optimistic about our chances of winning. We may reason that if we lose 10 times in a row, we will soon win. Or that because it’s been playing for many years, it would be a shame to stop now, because we’ve ‘invested’ all that time and money, and we might win soon.

No. 4: Americans Spend More on Lotteries than Many Other Things

Americans spend in many on Lotteries. Data from the 2017 U.S. Census found total state lottery spending at $ 71.8 billion. Compare that to another big company – video games. In 2019, Americans spent about $ 35 billion on video games, which is only about half of lottery spending!

Given that there are about 330 million people in America, that amounts to an average annual expenditure of nearly $ 218 per person. And that’s just average. Since many people do not play the lottery, that means many people a lot more than $ 218.

Nr. 5: You may not win a lottery jackpot

Winning a lottery jackpot may seem like a dream come true, but for many winners it turns out to be a curse. Many did not know how to manage their money and spent it all quickly. (If you are hoping to win a jackpot, spend some time learning to invest.) Many were swindled by down-do-wells that were after their money. Less maliciously, friends and relatives have their hands out, hoping for some of the profits – and perhaps some. Relationships change too, perhaps not for the better. One winner is said to have told his financial adviser, “Winning the lottery is the worst thing that has ever happened to me.”

No. 6: Many winners never collect

Not every lottery winner realizes that he or she is a winner. Many winning prizes are not going to be claimed – worth as much as $ 2.89 billion in 2017, according to research by Brett Jacobson. It is not a great idea to buy a lottery ticket, but if you do, check to see if you have won.

Nr. 7: You might be able to build your own jackpot, over time

Instead of throwing down money with lottery tickets, you can invest in stocks over significant periods and collect some hefty sums with much less risk. For example, if you are a heavyweight lottery player and spend $ 1,000 a year on cards, you can invest that instead. If those investments grow at an annual average rate of 8% over 25 years, then they will be worth close to $ 80,000! So you spent $ 25,000 and raised $ 80,000 – for a profit of $ 55,000. That’s a much more reliable way to get richer than hoping for a lottery win of $ 55,000 or more. The table below shows what you can accumulate if you become serious about investing – perhaps before your retirement:

Growing at 8% for	Invested $ 5,000 annually	$ 10,000 invested annually	Invested $ 15,000 annually
5 years	$ 31,680	$ 63,359	$ 95,039
10 years	$ 78,227	$ 156,455	$ 234,682
15 years	$ 146,621	$ 293,243	$ 439,864
20 years	$ 247,115	$ 494,229	$ 741,344
25 years	$ 394,772	$ 789,544	$ 1.2 million
30 years	$ 611,729	$ 1.2 million	$ 1.8 million
35 years	$ 930,511	$ 1.9 million	$ 2.8 million
40 years	$ 1.4 million	$ 2.8 million	$ 4.2 million

Calculations by author.

Clearly, there are better ways to get rich than through Lottery tickets. Investing in stocks is a great way, and you can boost your wealth by simply taking a side action – ideally, investing every extra long-term dollar. Go ahead and buy an occasional lottery ticket just for fun, if you want to, but don’t buy a lot, and don’t expect to win much.

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