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Don’t Play The Lottery [Bonus Simulator!]

Posted By Jim On 09/05/2012 @ 7:13 am In Personal Finance | 17 Comments

When it comes to lotteries, Powerball [3] gets all the attention. Whenever the jackpot gets all crazy, people get all crazy, and crazy people make bad decisions. Especially when it comes to money.

But as everyone knows… playing the lottery is a bad idea. The only way to win at the lottery [4] is to not play at all.

It’s one thing to see the odds of winning and it’s another to simulate it and see how long it would take to win. Fortunately, this simulator [5] does all of the hard work. Results obviously vary but it took 29,675 tickets before I “won” the \$100 prize (four matching numbers). That’s two tickets a week for more than two hundred and eight five years.

It resulted in a loss of \$55,190 over that span!

My luck improved as the next \$100 ticket winner came on the 34,307th ticket, a mere 4632 tickets later. Cumulative losses were only 63,771. Still no win larger than a \$100 though and one wouldn’t come for a while.

So I simmed until I broke through the \$100 barrier and that took… I have no idea. After 700 years and 72,805 tickets, I gave up. Here’s the damage:

• 2318 of the 72805 tickets were winners.
• Spent \$145,610 in order to win \$10,946.
• Only eight of the tickets yielded \$100, the rest were the \$4 and \$7 variety.
• A loss of \$134,664 over 700 years.

Two interesting things from the simulation, besides the fact that the lottery is a sucker’s game:

• From start (after like the first thousand tickets) to finish, the simulation said you can expect to see around seven to eight cents back for every dollar you spend on lottery tickets. The math says you should expect more but the sim, through tens of thousands of tickets, says 7-8 cents. That’s worse than any game in any casino.
• This is less from the simulation and more a realization from simply math… if you win the top prize one in 175,223,510 tickets and you buy two a week then it would take you basically FOREVER before you won.

Update Sept. 10th: So I had some free time and thought I’d run the sim again… it’s currently at around 731k games, having spent \$1.46 million and the biggest prize I’ve “won” is the \$10,000 prize. Return is around 8 cents on/of the dollar. FAQ says that at max speed 47/7, it’ll take 20 days.

Update: Ha! I just “won” a million dollar jackpot in the 1,172,229th game after spending \$2.3 million dollars. Returns just jumped to 51 cents… so I can expect to only lose half of my money. It actually won ahead of schedule. You’re supposed to win the million dollar prize once every 5.1 million games, so I should consider my-fake-lotter-player-self lucky.

That said… someone wins (usually multiple someone’s). So hats off to the recent Powerball winner in Michigan [6]!

(Photo: booleansplit [7])

URL to article: http://www.bargaineering.com/articles/play-lottery-bonus-simulator.html

URLs in this post:

[2] Email: mailto:?subject=http://www.bargaineering.com/articles/play-lottery-bonus-simulator.html

[3] Powerball: http://www.bargaineering.com/articles/powerball-jackpot-at-340m-dont-play.html

[4] win at the lottery: http://www.bargaineering.com/articles/how-to-win-the-lottery.html

[5] this simulator: http://justwebware.com/powerball/powerball.html

[6] Powerball winner in Michigan: http://usnews.nbcnews.com/_news/2012/08/17/13337128-mystery-powerball-jackpot-winner-leaves-michigan-town-abuzz?lite

[7] booleansplit: http://www.flickr.com/photos/booleansplit/3856718374/sizes/s/