Want to make money? Don’t play the lottery

Experts give alternatives to spending money on lottery tickets

U.S Census data shows that lottery sales in 2016, the most recent year with complete data, totaled more than $80 billion. Yes, with a “B.” That comes out to about $313 a year for every adult.

To put that into perspective, that is more than the typical household spends on milk, fresh vegetables and fruits or reading materials.

And the probability of winning the lottery is about as remote as it gets at about a 1-in-302-million for mega millions players. You have significantly better odds of becoming an astronaut, being elected President of the United States, having identical quadruplets or getting attacked by a shark.

But the real implications of the lottery, which will impact everyone in a tangible sense, is that Americans are simply losing out on money. And if you think that winning the lottery is a legitimate way of getting wealth one economics professor told financial publisher “Moneywise” that it would be like having an NFL team switch over to baseball in order to win a championship. In other words: highly unlikely.

In 2016, Census data shows Texans spent about $4.8 billion on lottery tickets. But if they would have just invested it in the S&P 500, then the total return would have been $6.5-billion, in just one year.

Instead, economists say it is better to invest the money you spend on lottery tickets. Opening a 401K or IRA or even just a simple account to invest in index funds will give you a better return on your money in the long run. And the odds are in your favor if you invest.

If you like to play the lottery for fun, financial experts have some tips. First, don’t play too often, otherwise it is gambling. Second, make sure you have a budget to play the lottery and that you aren’t spending money needed for necessities, like housing, food or bills. And third, buy just one ticket. Spending more money on more tickets thinking you have a better chance to win is mathematically negligible.

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