Lotteries - Waste of Money or Fun Gambling?

Discussion in 'Rants' started by Gyoin, Feb 11, 2015.

  1. Gyoin

    Gyoin Over Analystical Extreme Gambler




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    So this is something I've always been fascinated with. I know the general theory of a lottery is that it's a waste of money. An "idiot's tax". An impossible odds pipe dream. That said, I still like to play it. I mean, even though I have a 1 in 175,000,000-ish chance in winning, there is still a chance! It goes against EVERY financial thought process in my body, but I still enjoy playing! There is just something about the thought of winning one of these hundred million jackpots, relaxing for the rest of my life on interest, never having to work again that I just have a hard time resisting. I mean, it's a fools logic, but you can't win if you don't play!

    Yes, I'm trying to rationalize and that, at the end of the day, I'm most likely throwing away money. I can't argue against that point. It's still enjoying the dream though.

    And even with a "$450,000,000" powerball, if you accept lump sum and taxes, you only take home about $150,000,000. Sure, that's only a third of the estimated amount, but what would you do with $150M?! We've all seen the stories of people blowing it all, losing families, losing friends, and becoming hovels of their past self. History dictates that it only ruins lives. I'd still want the opportunity though. I'd love to see how I can manipulate tax credits and maximize the potential this money. Keep the most out of the governments hands as possible, and then live maybe not luxuriously, but comfortably. I mean, even at a 1% gain on this money a year, that's $1.5M a year to live off of. $30,000 a week. You could travel, eat just about anywhere, do just about anything. I mean, some of us live off of $30k a year!

    Alright, that's enough of my dream talking. Do you play the lottery? Do you dream about winning big? What would you do with the money? Or is it all just a fools game and those who play are just that. Fools.
     
  2. Gyoin

    Gyoin Over Analystical Extreme Gambler




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    Also, probably the first "luxury" thing I'd do if I were to win.

    Buy a cheap condo in Boston near Fenway, and buy Season Tickets for the Sox. How cool would it be to become "that guy that never misses a game" or something for your favorite sports team? Where staff learns your name and just be a regular. I couldn't imagine a more fascinating experience, one that I would treasure for a lifetime.
     
  3. Baldoraxx

    Baldoraxx Internalizing Master Of Casual




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    I still play for the fun and thrill of it. Now, by no means do i dump an insane amount of money into it in hopes to have better chances. Pick a few numbers and stick with them. Play them over and over and you have a better chance than if the machine picks them.

    again, this is maybe me playing once it gets up and above a few million and yes this is still a huge amount of money even taking the lump sum. First thing i would do is figure out how to take this money and keep getting more money i.e. investing or buying businesses and having them shell out money to me.

    To me, i don't think it is a waste of money. It is your money, do what you want with it. Some people say video games are a waste of money, alcohol, cigarettes (ewwwww) and other forms of entertainment.
     
  4. PsionicFox

    PsionicFox Future Man




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    I play. But in Aus we have much smaller prize pools. Like $30M is a fairly big jackpot here. But we don't pay taxes of prizemoney. So if I'm the sole Division 1 winner for $30M this week, I will get $30M.

    But heck, if I won $5M, I would never have to work again. I can take the money, put it in a safe high-interest savings account, and live off the interest. 5% interest on that money? I'm earning $250K per annum now. That's about 100K more than what my parents collectively earn in a year, and they live very comfortably.
     
  5. Gyoin

    Gyoin Over Analystical Extreme Gambler




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    Yeah, I was reading on reddit that AUS lotteries pay as advertised. That's pretty awesome. We have the option here (at least for Powerball) to either take a lump sum of a smaller amount, or get paid on a balloon payment plan over 30 years that "should pay the advertised amount" (non-transferable, void if deceased, etc.), but both are still taxed as income.
     
  6. LaNCeRs

    LaNCeRs




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    As a money guy, if you played $1 every day for a year, that's only $365 a year or $3,650 every 10 years. I can justify that simply by saying I am paying for cheap entertainment. At the end of the day, as long as you are okay with foregoing that money, there is no reason not to play.

    For the rest of you asking how the lottery works and why $150M is all you would take home on a $450M jackpot, this is how it works. The current lump sum rates on jackpots is about 70% of the actual jackpot. If you decline the lump sum, you have the opportunity to take annual installments. You are then taxed roughly 50% (it's more like 40% or so, but I always use 50% as a rule of thumb since it's easy to quickly divide by two).

    As a person who oversees people who are buying and selling securities for jackpots, if you ever get in a position where you actually win one, ALWAYS take the lump sum. 90% of jackpots are based off the discounted 20 year treasury rate (longer in some instances). If you were to invest the lump sum in a simple money market, you would earn interest significantly higher than these treasuries.
     
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  7. Passage

    Passage Polychromatic




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    I agree with this. I don't gamble, but I view the lottery the same way. I'm just too lazy to go out and get tickets regularly. Or at all.
     
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  8. Gyoin

    Gyoin Over Analystical Extreme Gambler




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    I just bought tickets probably the first time since a couple large jackpots a while ago, maybe 5 or 6 months? I dropped $20. I've lost 10x more on a single blackjack hand before. Fell into the hype a little bit, but hey, you never know right?!

    And if I win, I'm totally sponsoring a TAB get together somewhere awesome.
     
  9. tr1age

    tr1age [Community Leader] Butterflies!




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    moved to rants.
     
  10. Exittus

    Exittus Fairy Princess




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    I don't understand. Why is this a rant?
     
  11. Baldoraxx

    Baldoraxx Internalizing Master Of Casual




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    ^seconded.

    It feels more of a discussion
     
  12. dainjre

    dainjre Generously Compensated Establishment Provocateur




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    You're a rant.

    People are going in a pool for powerball tickets at the office. Lol
     
  13. Gyoin

    Gyoin Over Analystical Extreme Gambler




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    Yeah, thought it was definitely more discussion based than a rant.
     
  14. Passage

    Passage Polychromatic




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    What would I do with the money? Not tell anyone.

    "Hey Topic, that's a fancy new car you got. How can you afford it?"

    "Bro, I had to bust out the kneepads..."

    ...will be my response for everything.
     
  15. Crake

    Crake ୧༼ಠ益ಠ༽୨ Stronk




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    same
     
  16. Gyoin

    Gyoin Over Analystical Extreme Gambler




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    See, I agree with this full heartedly. That said, upon receipt of many of these, you're contractually obligated to fulfill certain PR duties which makes it difficult to stay fully anonymous. Especially since these are run by the government, it typically becomes a public knowledge of who won what.
     
  17. Baldoraxx

    Baldoraxx Internalizing Master Of Casual




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    Aren't you only supposed to give your name? Like either a first OR a last name. Like i said before, the first thing i would do is contact a lawyer and see what we can do to keep me as anonymous as we can.
     
  18. PsionicFox

    PsionicFox Future Man




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    I wouldn't sponsor a get-together, per se. But I would book out some place we could hang out, and give people heaps of warning that I was coming to the US. And then bribe people to show up. :)
     
  19. dainjre

    dainjre Generously Compensated Establishment Provocateur




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    As your attorney, I'll do everything i can for you... For a sizeable fee, of course.
     
  20. Baldoraxx

    Baldoraxx Internalizing Master Of Casual




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    Hey if i get $150 million in a lump sum and this lawyer gets me the most i can and helps keep my identity a secret from the public (who would want my money!!!) then i wouldn't mind paying him a good amount of money
     
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