Comments on: When You Should Play the Lottery http://cashmoneylife.com/2007/03/20/when-its-somewhat-correct-to-play-the-lottery/ Money Management, Small Business, Career Sun, 21 Mar 2010 02:34:22 +0000 http://wordpress.org/?v=2.9.2 hourly 1 By: Ryan http://cashmoneylife.com/2007/03/20/when-its-somewhat-correct-to-play-the-lottery/comment-page-1/#comment-8986 Ryan Fri, 30 May 2008 16:04:28 +0000 http://cashmoneylife.com/?p=7#comment-8986 nalien, Thanks for sharing! I'm pretty sure the $2500 is still taxable, but he wouldn't have to fill out the tax forms because each winning ticket was less than $500. He is still responsible for claiming the winnings on his taxes. However, with no paper record and the winnings paid in cash, it would be extremely difficult for the IRS to prove. I still play on occasion, but the jackpot needs to get to the $150M range or higher. That limits the times I actually play to a couple times per year. It's all in good fun. ;) nalien,

Thanks for sharing! I’m pretty sure the $2500 is still taxable, but he wouldn’t have to fill out the tax forms because each winning ticket was less than $500. He is still responsible for claiming the winnings on his taxes. However, with no paper record and the winnings paid in cash, it would be extremely difficult for the IRS to prove.

I still play on occasion, but the jackpot needs to get to the $150M range or higher. That limits the times I actually play to a couple times per year. It’s all in good fun. ;)

]]> By: nalien http://cashmoneylife.com/2007/03/20/when-its-somewhat-correct-to-play-the-lottery/comment-page-1/#comment-8868 nalien Sun, 25 May 2008 15:37:06 +0000 http://cashmoneylife.com/?p=7#comment-8868 I play lottery occasionally. In my state (MN), there is a game called northstar cash. It's one dollar to play, and you pick 5 numbers between 1 and 31. It's done 7 days a week, jackpot starts at 25,000, odds of winning jackpot are 1 out of 169,911. So, when it gets to 170,000 or higher, it's a good bet to play. I know the jackpot relatively small, but the odds are SOO much better. (170 thousand to one, or 170 million to one...) And 175,000 would certainly be life changing for me. However, it's been a while since it got that high :( Another interesting thing about MN lottery: Years ago, as a grocery store clerk (grocery store sold lottery tickets), a gentleman came through my line to turn in winning tickets. Prizes over 600 are taxable, those under 600 are not. Lottery retailers may pay out any prize under 600. The gentleman had 5 seperate "Daily 3" tikets. The default bet for daily three goes to a "straight/box" bet, where .50 of your bet bets on your three numbers IN ORDER, and the other .50 bets on your three numbers in any order. Straight pays better (500 to 1, odds 1000 to 1), box is more likely (pays 160 to 1, odds 330 to 1). Anyway, he had 5 individual tickets, each with 1 dollar bet on STRAIGHT 3-6-9. 3-6-9 won that day. He had FIVE winners of $500, thus EACH ONE WAS UNTAXABLE. It would be more convinient to just print one ticket with a 5 dollar bet, but then they payout would be 2500, and would be taxed! Our store policy was to only cash one $500 winner per person per day, but I let him go thru the line twice :D. Ever since, I have played 5 individual dollars on a straight number OCCASIONALLY, but have never won (it did come up out of order, but i wasn't betting on box...) I play lottery occasionally. In my state (MN), there is a game called northstar cash. It’s one dollar to play, and you pick 5 numbers between 1 and 31. It’s done 7 days a week, jackpot starts at 25,000, odds of winning jackpot are 1 out of 169,911. So, when it gets to 170,000 or higher, it’s a good bet to play.

I know the jackpot relatively small, but the odds are SOO much better. (170 thousand to one, or 170 million to one…) And 175,000 would certainly be life changing for me.

However, it’s been a while since it got that high :(

Another interesting thing about MN lottery:

Years ago, as a grocery store clerk (grocery store sold lottery tickets), a gentleman came through my line to turn in winning tickets. Prizes over 600 are taxable, those under 600 are not. Lottery retailers may pay out any prize under 600. The gentleman had 5 seperate “Daily 3″ tikets. The default bet for daily three goes to a “straight/box” bet, where .50 of your bet bets on your three numbers IN ORDER, and the other .50 bets on your three numbers in any order. Straight pays better (500 to 1, odds 1000 to 1), box is more likely (pays 160 to 1, odds 330 to 1). Anyway, he had 5 individual tickets, each with 1 dollar bet on STRAIGHT 3-6-9. 3-6-9 won that day. He had FIVE winners of $500, thus EACH ONE WAS UNTAXABLE. It would be more convinient to just print one ticket with a 5 dollar bet, but then they payout would be 2500, and would be taxed! Our store policy was to only cash one $500 winner per person per day, but I let him go thru the line twice :D .

Ever since, I have played 5 individual dollars on a straight number OCCASIONALLY, but have never won (it did come up out of order, but i wasn’t betting on box…)

]]> By: Save Money http://cashmoneylife.com/2007/03/20/when-its-somewhat-correct-to-play-the-lottery/comment-page-1/#comment-6890 Save Money Thu, 03 Apr 2008 06:01:56 +0000 http://cashmoneylife.com/?p=7#comment-6890 You know it's not a bad thing to buy a lottery ticket every so often. It's fun to dream about what you could possibly do with all that money. I've bought 2 lottery tickets in my life and I didn't win anything in either of them. But it was a fun experience and theres always that if factor. What if you do win? Just what if... Plus you can't win if you don't buy a ticket so one in 170 million is still better odds then none at all. You know it’s not a bad thing to buy a lottery ticket every so often. It’s fun to dream about what you could possibly do with all that money.
I’ve bought 2 lottery tickets in my life and I didn’t win anything in either of them. But it was a fun experience and theres always that if factor. What if you do win? Just what if…
Plus you can’t win if you don’t buy a ticket so one in 170 million is still better odds then none at all.

]]> By: kentuckyliz http://cashmoneylife.com/2007/03/20/when-its-somewhat-correct-to-play-the-lottery/comment-page-1/#comment-6347 kentuckyliz Wed, 12 Mar 2008 21:19:07 +0000 http://cashmoneylife.com/?p=7#comment-6347 I don't pay attention to the lottery...however, if one of us at the office happens to notice a massive jackpot, we occasionally pool our $1s and therefore have access to more chances than if we bought an individual ticket. The people and contribution amounts are recorded on the collection envelope as a record of share purchased. It's fun to do as a group. If we won a big jackpot, yeah, we'd have to share it, but hey, nice problem. Once every few years, I'll go with family to the gambling riverboat, but I'm so cheap, I don't like to lose money, I'll watch other people gamble, then play the penny slots for a while. My sister and I sit next to each other and we'll whoop and holler at winning ten pennies in a play, and people look at us as if we won a huge jackpot. We have fun putting everyone on. In general I don't like gambling. I don’t pay attention to the lottery…however, if one of us at the office happens to notice a massive jackpot, we occasionally pool our $1s and therefore have access to more chances than if we bought an individual ticket. The people and contribution amounts are recorded on the collection envelope as a record of share purchased. It’s fun to do as a group. If we won a big jackpot, yeah, we’d have to share it, but hey, nice problem.

Once every few years, I’ll go with family to the gambling riverboat, but I’m so cheap, I don’t like to lose money, I’ll watch other people gamble, then play the penny slots for a while. My sister and I sit next to each other and we’ll whoop and holler at winning ten pennies in a play, and people look at us as if we won a huge jackpot. We have fun putting everyone on.

In general I don’t like gambling.

]]> By: Dividend growth investor http://cashmoneylife.com/2007/03/20/when-its-somewhat-correct-to-play-the-lottery/comment-page-1/#comment-5888 Dividend growth investor Mon, 18 Feb 2008 22:35:27 +0000 http://cashmoneylife.com/?p=7#comment-5888 I think that if I had 175 million dollars, i would actually invest in the lottery company or found one, as opposed to buying 175 million tickets. Of course people who play the lottery are usually very poor people, who want to get rich quick. Even when these poor people do hit the jackpot, they don't usually keep the money for long and its a tragedy for them.. I think that the number one reason why financial education is not a prerequisite course in school ( it could only be found in college i think) is because states make way too much money from lotteries on the expense of their citizens.. I think that if I had 175 million dollars, i would actually invest in the lottery company or found one, as opposed to buying 175 million tickets. Of course people who play the lottery are usually very poor people, who want to get rich quick. Even when these poor people do hit the jackpot, they don’t usually keep the money for long and its a tragedy for them.. I think that the number one reason why financial education is not a prerequisite course in school ( it could only be found in college i think) is because states make way too much money from lotteries on the expense of their citizens..

]]> By: Ryan http://cashmoneylife.com/2007/03/20/when-its-somewhat-correct-to-play-the-lottery/comment-page-1/#comment-3251 Ryan Fri, 21 Dec 2007 11:39:53 +0000 http://cashmoneylife.com/?p=7#comment-3251 I agree, Phillip, the pot odds are rarely 1:1, but let's be honest here... for a $1 entry, the return is pretty good if you win. There are also quite a few other winning tickets that range from a few bucks all the way up to $250k. I don't personally make it a habit to buy tickets, but I sometimes buy then when it reaches about $150 million. If only to dream. :) I agree, Phillip, the pot odds are rarely 1:1, but let’s be honest here… for a $1 entry, the return is pretty good if you win. There are also quite a few other winning tickets that range from a few bucks all the way up to $250k. I don’t personally make it a habit to buy tickets, but I sometimes buy then when it reaches about $150 million. If only to dream. :)

]]> By: Phillip T Jackson http://cashmoneylife.com/2007/03/20/when-its-somewhat-correct-to-play-the-lottery/comment-page-1/#comment-3249 Phillip T Jackson Fri, 21 Dec 2007 08:20:18 +0000 http://cashmoneylife.com/?p=7#comment-3249 You have to include for inflation, taxes, and you need to approximate the odds of splitting the pot.... When I add these other factors, I get that it is 90-97% pot odds which isn't bad considering the fact that 27% of the money is going to good governmental funds (college scholarships, etc.) You have to include for inflation, taxes, and you need to approximate the odds of splitting the pot…. When I add these other factors, I get that it is 90-97% pot odds which isn’t bad considering the fact that 27% of the money is going to good governmental funds (college scholarships, etc.)

]]> By: Ryan http://cashmoneylife.com/2007/03/20/when-its-somewhat-correct-to-play-the-lottery/comment-page-1/#comment-900 Ryan Mon, 27 Aug 2007 10:33:30 +0000 http://cashmoneylife.com/?p=7#comment-900 Hi Joel, Very true, but many lotteries also give a cash option when you buy, or even at the time you win. I would have to take the cash option. Like you say, the time value of money makes it worth the cash option! Hi Joel,

Very true, but many lotteries also give a cash option when you buy, or even at the time you win. I would have to take the cash option. Like you say, the time value of money makes it worth the cash option!

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