Lottery is the most popular form of gambling in the US, raising billions each year. And while many people play for fun, others see it as their ticket to a better life. Regardless of why you play, it’s important to understand how lottery works and the odds of winning.
In this week’s episode of The Money Pit, I take a deep dive into the state of lottery games and the way they lure us in with their promises of instant riches. I also talk to a man who has won seven lottery jackpots, and shares his methods for success.
The history of lottery dates back to the Low Countries in the 15th century, with records from Ghent, Utrecht and Bruges showing that town officials used them to raise funds for fortifications and the poor. However, it wasn’t until the Revolutionary War that Americans saw lottery tickets as a form of hidden tax. The Continental Congress used them to raise money for the Revolutionary Army, and Alexander Hamilton wrote that “it is the natural tendency of all men to hazard trifling sums for the chance of considerable gain” that led to their popularity.
It’s not surprising that a lottery is a game of chance, and the odds are low. But what’s interesting is how the odds are manipulated to make the prizes seem much bigger than they actually are. Super-sized jackpots drive lottery sales, and they get a ton of free publicity on news sites and on TV. This leads to the false sense that we all have a good chance of becoming rich – and it’s one reason why so many people continue to buy tickets.
If you want to increase your chances of winning the lottery, you can buy more tickets, or try a different type of game. For example, a scratch-off ticket has less numbers to choose from and offers higher payouts than a standard lottery. Another option is to try a pull-tab, a ticket with numbers on the back hidden behind a perforated paper tab that must be broken open to reveal them. If the numbers match those on the front, you win!
If you’re going to try your hand at the lottery, it’s important to remember that no set of numbers is luckier than any other. You can improve your chances by playing more often, and selecting random numbers that aren’t close together so other people are less likely to pick them. You can also pool your resources with other players and buy a larger number of tickets. But most importantly, be responsible with your money. Plenty of winners end up blowing their windfall, spending it on luxury houses and cars, or even worse. Certified financial planner Robert Pagliarini told Business Insider that lottery winners should assemble a “financial triad” to help them navigate the challenges of sudden wealth. He recommends a savings plan, asset allocation, and a budget to prevent you from over-spending.