Published August 7, 2023 at 12:30 p.m. ET
Cody Jackson-Strong, 29, buys a Mega Millions lottery ticket on Thursday, August 3, 2023, at a Minneapolis gas station, hoping to win the jackpot. (AP Photo/Trisha Ahmed)
NEW YORK – There’s no shaking it. Your chances of winning the lottery are extremely slim.
After no big winners Friday night, the Mega Millions jackpot climbed to $1.55 billion. If someone wins on Tuesday, in the next Mega Millions drawing, the prize would be one of the largest in American lottery history.
But don’t plan to enter a new tax bracket anytime soon. The odds of winning a Mega Millions jackpot, regardless of size, are approximately 1 in 302.6 million.
Due to the almost impossible odds of winning big, experts stress that you shouldn’t spend all your money on lottery tickets. If you choose to gamble, it’s important to be careful about what you can afford – and perhaps consider other places to put your money, even if it’s just a few dollars at a time. times.
Lottery tickets are “definitely not good investments,” Matthew Kovach, an assistant professor in Virginia Tech’s economics department, told the Associated Press last month. “They’re not even investments… you’re always expected to lose money.”
Here are some things to know about the chances of winning the lottery.
WINNING THE LOTTERY IS ALMOST IMPOSSIBLE. WHAT IS MOST LIKELY?
There is a long list of rare events that are more likely than hitting the Mega Millions or Powerball jackpot.
A common comparison is the chance of being struck by lightning once in your lifetime, which is about one in 15,300. Even if you bought a lottery ticket for every drawing over the past 80 years — twice per week for Mega Millions and three times per week for Powerball — you’d still be far less likely to win than being struck by lightning once in your life. life, said Steven Diaz, a mathematics professor at Syracuse University.
“A somewhat darker example,” Kovach added, is comparing the odds of winning the lottery to a fatal car accident on the way to a store. “Imagine you have to travel 800 meters to buy your lottery ticket, so you have a 1 kilometer round trip. It is about 4 times more likely that you will die in a car accident during the trip to buy your ticket than winning,” he said.
Of course, Mega Millions and Powerball both offer a handful of tiers below the top jackpots, with the lowest prizes starting at $2 and $4, respectively. For both games, the odds of winning a prize are approximately 1 in 24.
HAS WINNING THE LOTTERY BECOME HARDER?
Yes. Winning the lottery has become more difficult in recent years, causing jackpots to get bigger and bigger – and that’s intentional.
Such big jackpots come down to math and tougher odds. In 2015, the Powerball lottery increased the odds of winning from 1 in 175.2 million to 1 in 292.2 million. The Mega Millions followed two years later, increasing the odds of winning the top prize from 1 in 258.9 million to 1 in 302.6 million. The biggest lottery jackpots in the United States have been won since these changes were made.
HOW MUCH DO JACKPOT WINNERS REALLY TAKE HOME?
When a person wins a lottery jackpot in games like Powerball or Mega Millions, they have two options: an annuity distributed over 29 years or a (significantly smaller) cash payout.
The estimated $1.25 billion jackpot won in Friday’s Mega Millions drawing, for example, is the annuity option — and the cash value of that prize is nearly half that, amounting to $625.3 million. Most jackpot winners go for cash.
Federal and state taxes will also reduce the money you bring home, with deductions depending on where you live.
IS BUYING A LOTTERY TICKET A GOOD INVESTMENT?
Because winning is so rare, experts argue that lottery tickets are horrible investments – but note that each person’s reason for playing the lottery is different.
Some people may buy a $2 lottery ticket as a form of entertainment and find satisfaction in “the excitement of thinking you might win,” Diaz said. Meanwhile, others may enter the lottery out of desperation or financial hardship – with experts pointing to consequences that have disproportionately affected low-income communities.
The lottery has always acted as a regressive tax on the poor, meaning people who can least afford to lose their money buy the most tickets, said Lia Nower, professor and director of the Center for Lottery Studies. game at Rutgers University. PA.
She said that “what concerns her is that more people are buying it every day or two or three times a week”, as opposed to those who buy a single ticket, as the jackpot approaches $1 billion. dollars.
A US$2 ticket may not seem like much, but it can add up for those who regularly participate in the lottery over time. Alternative spending options could include opening an investment account that lets you invest small amounts or purchasing partial stocks, Kovach said.
In reality, it’s probably better to diversify through something like an index fund, but if you’re just starting out, I would… (suggest putting it) in the stock market or something like that,” he said. “You actually, we’ll probably see a return over time. »