Friday, March 02, 2007

A Very, Very, Bad Retirement Plan

"You know horses are smarter than people. You never heard of a horse going broke betting on people." - Will Rogers

Tonight's jackpot for the Mega Millions is $267,000,000 with an estimated cash payout of $163,983,325. While I don't typcially play the lottery, I'm going to buy a ticket (or maybe two:-) for tonight's drawing. Here's why I am playing:

  • The cash payout is reasonable given the odds of winning are 1:175,711,536.

  • It is a reasonable amount of entertainment for one dollar. For a few hours, my ticket has the potential to return a lot of money.

  • Here's why I don't play the lottery regularly:

  • The odds of winning are 1:175,711,536. As Durago Bill points out in Mega Millions Odds, even at a $163,983,325 jackpot, the statistical return on every $1 ticket is only $0.60. So it's a bad return, statistically. Unless, of course, one is holding a jackpot ticket :-)

  • While it is reasonable amount of entertainment for one dollar, investing a dollar a day produces a guaranteed jackpot.

  • Part of the money is used for our schools. I don't like the concept of putting the money to good use to convince me to make a bad decision.
  • So even though I don't usually play the lottery, I will do it today. It's one of the bad personal finance decisions that I make four or five times a year:-) On Sunday, the dollar I might have spent on a lottery will be put back into savings.

    For more on Reaping the Rewards, check back every Friday for a new segment.

    Photo Credit:, Clara Natoli

    This is not financial advice. Please consult a professional advisor.

    Copyright © 2007 Achievement Catalyst, LLC


    Clever Dude said...

    I got my tickets (2). Although I'm sure I wouldn't complain if I won the jackpot, I seriously wouldn't mind the 2nd place prize: $250,000. After taxes, that's our non-home debt and our second mortgage.

    Super Saver said...

    Clever Dude,

    Good luck. 10 minutes left until we find out if we've won:-)

    golbguru said...

    Hey, expected to hear from you 10 minutes after 10:50 pm :), any good news?

    I have a hard time remembering when was the last time I bought a lottery ticket. I think it was about 12 years ago...seriously.

    Super Saver said...


    I decided to enjoy the potential of winning a few more hours and went to bed after posting my comment:-) Unfortunately, I don't remember if I dreamed about winning.

    The only good news is that Tuesday's jackpot is $340,000,000. The bad news is that I will likely spend another $2 on tickets. (Another bad personal finance decision:-)

    Sun said...

    I always buy 2 tickets when Mega millions goes over $100M. But when I heard yesterday it was $267M already, I decided to increase my odds a little bit, so I bought 5 tickets. Well, looks like I have to spend another 5 bucks. Sometimes I do hope somebody (if not me :)) just wins the whole so I don't have to keep throwing money away.

    A bad investment? It's an investment doesn't even have a return. BTW, I didn't win $5 from 2 tickets a couple of times before. That was a good investment until I bet the $5 with again no returns, :D.