As clever a witticism as it is to call lottery a tax on the stupid/innumerate/people who can’t do math, I, a degreed Accountant who could outdo 99 out of 100 of you in a head head math competition, do on occasion
1) Buy a Powerball ticket
2) buy a scratch off lottery ticket
3) play slot machines.
None of these things is a wise investment. But I KNOW that. It’s not about the fact that it’s more likely you will win than lose, it’s about other things.
For Powerball, jackpots start at $10 million, and have gotten as high as I think around $300 million (the pot goes up every week that someone doesn’t win). The odds are pretty horrible….the chances of getting all six numbers are close to one in two hundred million. Indeed, the EASIEST way to win ANYTHING, is to match the powerball alone, winning you $3 on a $1 bet, the odds of which are 1 in 61, and your overall odds of winning ANY prize are like 1 in 35. Not exactly a good investment. And as such, of all the forms of gambling, this is the one I play the least often. I play Powerball when the prize is very big (I don’t have a floor, some times it’s been $200 million before I played, some times $50 million, but I usually don’t buy a ticket if someone’s just won the prize).
Now one can point out who stupid and illogical that is and I fully agree. Consider that your odds of winning are no greater when the prize is $10 million than they are if the prize is $250 million, so why would you spend more for the same odds? Second problem is, realistically if I won $5 million, I highly doubt I’ll live more than 50 more years, if I divide 5 million by 50, that’s $100,000 per year, and that’s more than my wife have ever brought in put together….I imagine on a $100k per year income, I could live out the rest of my life pretty well without having to work again, which when you get right down to it is the purpose of playing the lottery…so that if you win, you don’t ever have to work again, at least for me it is.
So, why do I play, and why only when the jackpot is large? Well, it’s a fantasy. And I get the idea that I can fantasize without spending money. But to me there’s a real qualitative difference between fantasizing about winning 200 million dollars if there is an actual chance (though infinitesimally small it may be) and fantasizing about winning $200 million when I’m not entered into any contest where that would even be possible. For the fantasy to have any thrill to it in my book, it has to be within the realm of possibility, not probability. OK, yeah, my one ticket has a one in 200 million chance of winning that 200 million dollars, as does everyone else’s ticket, and when the jackpot gets that high, enough people are playing that someone is likely going to win. It won’t happen, I KNOW it won’t happen, but my ticket has just as much chance as anyone else’s, someone’s gotta win it, and it COULD be me.
Now, I don’t expect to win, and in fact, I don’t watch the drawing, I don’t call for the results the next day, in fact some times it’s months before I check my ticket. Yes, the next time I’m at the gas station I’ll see if the jackpot went up (meaning no one won, not even me) or down (meaning someone won, maybe me but probably not), and if I notice that there was a winner, I may then be more motivated to check my ticket, but sometimes I even forget until I see on the news some couple from Bungfuck, West Virginia claiming their prize. Then what often happens is I’ll have 2 or three tickets in my wallet from say a 2 month period, probably about how often I play on average, an I’ll call the phone number. I’ll say in my lifetime, I’ve spent maybe a grand total of $200 on Powerball tickets, and I believe I’ve won $3 twice and $4 once. But every time I’ve been able to think about what if.
I get to dream, to say, OK, this is the first thing I would do, this is the second, this is how I’d set it up, this is how I’d quit my job (if I happen to have one), this is how I’d tell my wife an family, this is what I’d do to my house, this is what I’d buy, this is where I’d travel, this is how I would invest….I enjoy thinking about these little details…living in my own little fantasy world that I’ve made plausible with a meager $1 investment. I’ve gotten more than my $190 net investment over the past couple decades since I started buying the very occasional ticket.
Now, for scratch offs, your typical scratch off has odds of around 1 in 3 to 1 in 5 of winning a prize, and there are a lot of prizes that match the denomination of the ticket, and a lot that are greater. Now, I honestly couldn’t say in net if I’d won or lost money on playing these, but understanding odds, it’s very unlikely that I’ve won in net. Some times I’ve spent as much as $20 at one time on scratch off tickets and won nothing, and some times I’ve spent a buck and won $50. For my dad’s 65th birthday, as he REALLY likes gambling, I bought him $65 worth of lottery tickets, he won $145 including a $100 ticket that I paid $3 for. The point is you will far more often win SOMETHING on a scratch off than you will on Powerball, and the way I see it is, even if in net I’ve spent more on scratch offs than I’ve won, I’ve never spent more than $20 (for myself) in one shot and never more than I could afford, and let’s say some times I threw away a dollar I never missed, at other times, I spent a dollar and won $30, and that extra $30 actually WAS meaningful. Now I know enough about odds to realize that it’s a losing proposition in the long run, but it’s again a thrill, a thrill that you might win, and a thrill if you actually DO win, but not much of a letdown if you don’t, as long as you’re not spending money you’ll miss.
But unlike Powerball, I find scratch offs fun to play. I will usually buy scratch offs that have interesting games. To me, spending a buck or two, or occasionally $10 or $20 when I can afford to is worth the enjoyment I get by playing the game on the ticket, when combined with the thrill of maybe winning and the occasional thrill of actually winning. Now again, this is not a regular occurrence for me, I might spend marginally more money on scratch offs than I do on Powerball, I’d estimate I’ve spent $500 over the last 20 years on scratch offs, I’m sure I’ve won back at least ½ of that, and yes, I’ve gotten $250 worth of entertainment out of it.
Casinos are the same thing, and I like to play slots, which anyone who knows anything about odds will tell you is a fool’s game. Basically how slots work is they are set to pay back a percentage of what they take in, a smaller percentage than what they take in. And what happens is they pretty much suck money until they’re full and ready to pay, then they pay until they’re back at that average. The majority of machines you get on are going to be losers. As for winning and losing, I’ll play only what I can afford to lose. Usually I’ll have a bankroll of about $50, I maybe go 3 times a year, that’s on average over the last 20 years, so that’s what, 3 grand? But it’s to as if I’ve lost my entire $50 every time I’ve gone. Some times I have, some times I’ve lost $20 or $5, some times I’ve won $20, or $50, sometimes more…once I walked away with $350. I’d say it’s unlikely I’ve lost more money on casinos than I’ve lost on scratch offs. Now I also spend 4 or 5 hours playing slots when I go, let’s say I lose on average $10 in a 5 hour period, well I’ve just been entertained for 2 bucks an hour.
And there is a thrill, I could win, I have won, and I could win big even though I haven’t, I can daydream about winning big…I know it won’t happen, but I know it has happened to people on occasion, and it theoretically could happen, which just like Powerball, makes it plausible to daydream about. But I just like seeing the occasional jackpot or bonus game, I like the anticipation of what’s going to happen on this play. I will basically play penny slots where you play a multiple number of lines, one coin per line, some times as few as 12 lines, some times as many as 40, so 12 to 40 cents per game…and yeah, it adds up if you sit there and just keep plunking money in. But what I do is I’ll set a goal for a machine, like I won’t lose more than $x playing it. Then if I win, I’ll cash out if I get down to $y or if I get higher than $z, and I stick to it. So the only time I lose that $50 is if I say to myself $5 is the most I’m willing to lose on a machine, and I lose that $5 right away on 10 machines in a row, then I’m done, no taking out more cash, no going back on it.
The point is, I limit what I’m willing to lose, I make sure I never lose more than I can afford, and I never spend more than the entertainment or fantasy I get by playing the game is worth to me. That way, even if (when) I lose, I’m not upset or angry about it. And I don’t play 10 tickets a week, I don’t have a set of numbers, I don’t have a ‘system’, I don’t reinvest every single dollar I win, and I try not to make stupid mistakes. Some people think it’s bound to hit, and they get in over their heads, they figure they’re in so far their only choice is to go in deeper and hope for a big hit to make it all up. It only takes one big win after all. If you gamble, do it because you want to, and don’t expect to win, it makes the thrill of actually winning all that greater. If it’s not for you, it’s not for you. But not everyone who gambles is stupid. Just the people who hold up the line by turning in their $6 in winners with another $20 out of their wallets so they can play all their numbers that week because they “have a system” and “it’s only a matter of time”.