Lotteries and prize drawings are big businesses throughout the world. They entice significant annual investments from individuals who dream of scooping a huge and potentially life-changing cash prize. Their proceeds also go to public sectors including education, park services and funds for veterans and seniors. In the United States, the Mega Millions and Powerball lotteries have become a key feature of monthly consumer expenditures. In 2016, the lottery generated $72,649,684,000. The profits generated by national lotteries are therefore understandably huge. With the stakes so high and the chances of winning so minimal, however, is participating in the lottery a waste of cash or simply a high-risk investment opportunity that is worth a weekly gamble?
Lotteries in the U.S.
In actual fact, while your chances of winning the lottery anywhere are decidedly slim, the sheer size of the U.S. population and popularity of the game means that American participants must climb an even steeper mountain towards any potential windfall.
Now even though this equates to several tickets being purchased per U.S. resident, the odds of each participant winning have historically stood at approximately 1 in 176,000,000. This means that statistically there is a greater likelihood of being struck by lightning or becoming a billionaire than there was of claiming the Mega Millions jackpot. Americans still invested more than $70 billion into chasing their fanciful dreams of wealth and fortune. This is reflective of a growing trend, where lottery sales continue to soar despite the uncertain economic climate.
By state, New Yorkers have been one of the leading lottery spenders. In 2016, New York accounted for 9.7 billion in lottery sales. California, Florida, Massachusetts and Texas rounded out the top five for spending.
The Argument Against National Lotteries
An interesting consequence of the Mega Millions jackpot win is that there has been a significant rise in the number of syndicates that are purchasing tickets. This proves that rather than being discouraged by the seemingly insurmountable odds of victory, Americans are instead looking for innovative ways to improve their chances and actively investing more into buying tickets. Now, while an estimated one in three global lotteries are won by syndicates, the likelihood of winning remains remote in the extreme, which raises questions about participants and whether they could put their money to better use.
Even for those who win the lottery, their financial future or long-term happiness is not necessarily secured. Acquiring huge sums of money can inspire any number of extreme emotive reactions, and there have been several instances where winning the lottery has triggered a serious decline in lives of individuals and families.
The Benefits of National Lotteries
In 2018, there have been four mega millions jackpot winters. The last winner taking home - $543 million on July 24, 2018. This lottery winner was a resident of Santa Clara County, California who received their ticket through an office pool. As of October 17, the mega millions jackpot had increased to $900 million.
In total the average American spends approximately $223 yearly in the lottery. With the large majority of people spending more as the payout rises. This would suggest that rather than being symbolic of a growing gambling culture in the U.S., national lotteries are in fact a popular news items with their tickets played responsibly and only sporadically by most participants.
Another factor in favor of lotteries is the money that they generate for state funded projects, with public education in particular benefiting from the investment made by participants. With this in mind, people who play the lottery responsibly are contributing towards local community development, which actually means that their annual investment at least creates some form of social change. In terms of monetary value, approximate 34 cents out of every $1 spent on lottery tickets is invested into education, with 58 cents being awarded to winners in the form of prizes and 6 cents paid to participating retailers for sales commissions.
The Bottom Line
National lotteries across the globe are always likely to be the subject of extreme opinion and controversy. The fact remains, however, that participants have an individual accountability to play the game responsibly and spend within their means while pursuing the dream of huge cash prizes. As long as they do so, then there is no reason why they cannot enjoy the lottery while also contributing to state and national funding.