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Frugal Find: Don't Play the Lottery

   Posted On: September 20, 2013  |    Posted In: Saving  |     Posted by: Broke Millennial®

Around 11:45 am on Wednesday I did something completely out of character. I played the lottery. Frankly, I blame “FOMO.” An absolutely ridiculous acronym for “Fear of Missing Out.”

It all started when three women in my office began discussing the $400 million Powerball lottery. Within two minutes they had decided to pool some money to buy tickets and suddenly five other women jumped in with their hard-earned dollars. The eight women began fantasizing what they would do with their share of $400 million. I was quick to burst their bubble a bit by dropping in that Uncle Sam would take around 50% of their winnings. After figuring they’d all collect north of $20 million each, everyone began plotting what to do with their winnings. I stared at computer playing out a scenario in which they actually did when the lottery and I hadn’t been willing to stake a measly $2 to win $20 million. So, I reached for my wallet.

After I forked over my two bucks I began to plot how to spend $20* million (post-tax). Here is my quick breakdown:

  • $10 million immediately into savings/investments
  • $1 million to pay off the student loans (and other debt) for friends and family (I even had them picked out)
  • $2.5 million to buy homes in select cities
  • $2 million donated
  • $3 million to start my dream business
  • $1.5 million accessible cash (part in a savings account)

Needless to say, we were all at work yesterday instead of popping Dom Pérignon.

Perhaps my lack of $20 million today makes me a bit resentful about spending $2 for naught, but I still stand by my statement: Don’t Play the Lottery. True, you won’t win if you don’t play, but you can also waste a lot of money chasing lottery winnings. I can understand how playing the lottery becomes addicting. Soon you’re buying tickets for jackpots whenever you can and scratch-offs in between. The New York State lottery even targets your “FOMO” with the genius tagline of “Hey, You Never Know.”

If playing the lottery is your version of buying the occasional coffeehouse latte, then by all means splurge away. But if you find yourself sinking $10+ a week playing the lottery, you may want to evaluate the ROI. The odds of winning are usually stacked around 1 in 175 million. Your $520 a year could be better spent elsewhere. You also avoid the crushing blow of “losing” 20 million fictional dollars.

How do you feel about playing the lottery? How would you spend $20 million?

*We actually would have won $24.7 million apiece. The jackpot was $223 million after taxes. This was also based on the assumption we’d have the only winning ticket.

Please consider nominating my blog for the 4th annual Plutus Awards! I qualify for Best New Personal Finance Blogger, Best Personal Finance Blog for Young Adults and if I tickle your funny bone, then Most Humorous. Thank you kindly!

LINK LOVE For the Week

  • Protecting your wallet from #YOLO, #FOMO and #FONSY by Sarah on Budgets Are $exy – I chuckled to myself when I read this post because it obviously hit home after my rash purchase of a lottery ticket. This post also inspired my using my experience as a frugal find.
  • Can Obama Do Anything About the Cost of College? by John over at Frugal Rules – Great break down on Obama’s plan to help the student debt crisis. I’ll keep my opinion close to the vest.
  • When was the last time you did something for the first time? By Erin (#2) at Red Debted Stepchild – Well, that lottery ticket counts for me! Erin’s post did cause me to think about always making a conscious effort to try something new, especially while living in a city like New York.
  • Part 3: How to Talk to Kids about Money (ages 12-18) by Shannon at The Heavy Purse – I’ve made no secret of how much I love Shannon’s focus on financial literacy. You should really check out her whole series on how to talk money with kids. It really needn’t be a taboo topic.
  • And Kid President just for a dose of cuteness and because so many of my loved ones are (or will be) teachers!

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31 responses to “Frugal Find: Don't Play the Lottery

    1. That is a really cute idea! My company puts scratch offs in welcome cards for newbies. I actually won $5 from mine. Cashed them in and pocketed the money instead of buying more.

    1. Well if I had won it would’ve made me! It certainly won’t break me this once, but I can see how that possibility gets addicting to people.

  1. More often than not, playing the lottery is a terrible financial move. You mostly lose, it can get habitual fast and takes your mind off reality (Well, its not such a bad thing imagining living rich and large!)
    Still, in your specific scenario I’d also have played it…Imagine all the other coworkers living rich and large and you are stuck in the cubicle since you couldn’t part with what, 2 bucks. I doubt I’d live well with that….lol

    1. FOMO certainly took over my thinking with this one. I don’t regret doing it, but I would regret if it became a habit. I also understand how easily you could start playing just justifying it as $2 here and there. That can add up quickly.

  2. I’m starting to feel old. I see acronyms being used and I stare at them going what the heck does that mean. I haven’t ever participated in any lottery pools. It helps that I haven’t had anyone come around to ask.

  3. I was in the same position a few months ago when the jackpot was something insane. I tend not to pay attention to it as I don’t play, but one guy in the office had to say something and everyone started pitching in $5. So of course, I went ahead and added to it. Seeing as I rarely play I felt it was okay for a one-time thing. I would have regretted it if everyone else in my office won!

    1. I try not to pay attention too. I wasn’t even aware of that huge jackpot until my co-workers got all excited. I’m glad someone else felt the same way I did!

  4. Thankfully my co-workers don’t play the lotto (that I’m aware of at least). Boyfriend buys a ticket every now and then and can afford to do so, so I don’t say anything. I personally have never bought a lottery ticket, but I to each his/her own.

    1. A few of my friends play scratch offs every once and awhile. I’ve never purchased them myself for fearing of liking it too much and wasting money on a pricey habit.

    1. I may do it again in my life just for fun, but certainly wouldn’t want to make a habit of buying those tickets. ABC has a show (likely to fail) coming out soon about a group of co-workers who win the lottery together. I’m sure it will quickly resort to focusing on all the downsides of coming into quick wealth.

  5. Thanks for mentioning my post, Erin! I agree – money should definitely NOT be a taboo topic in homes. 🙂 I’m not a regular lottery player either but those big jackpots certainly do make me dream too! Like you, I might put in a couple of dollars in an office pool when the jackpots are huge, but otherwise I really don’t pay much attention, which is probably the safest!

  6. I have never played the lottery by myself, only at work. Fortunately it’s not $10/week, more like $20 and that money lasts for 5 months or something like that. I know I could spend it or save it for that matter for other things, but I am also guilty of FOMO. You always read those stories in the newspaper of a group of workers winning. It would really suck if my colleagues won and I didn’t play.

  7. It happens every year here at work. One must do all thought, I see no harm in playing For Fun mode from time to time with friends, but when it becomes frequent have to be rethought.

  8. It happens every year here at work. One must do all thought, I see no harm in playing For Fun mode from time to time with friends, but when it becomes frequent have to be rethought.

  9. It happens every year here at work. One must do all thought, I see no harm in playing For Fun mode from time to time with friends, but when it becomes frequent have to be rethought.

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