Wednesday, October 13, 2010

You've got to be in to win... your odds in life's lottery

Be in to win - those are wise words to guide your life to true success.

But this is also a slogan to sell lottery tickets in New Zealand (and probably elsewhere).

And lotteries do not make winners.  They encourage and feed off the same commercial fantasies that drive people to consume beyond their means.

Looking at the Lottery
Just a bit of fun, right?  And who knows, it could be you!  So where's the harm?

The lottery is gambling, as much as the slot machines and the roulette table - all luck, no skill.

Like all other gambling:
  1. The hook is the dream of being a big winner, but the odds are impossibly stacked against you.  It's not easy to get hold of actual figures, but average lottery gamblers will invest far more in tickets than they will ever win.
  2. Any money you do win is from other people just like you - the losers
  3. Most of the gamblers are spending money that isn't really spare.  They have mortgages, and credit card debt, and car payments...and usually, limited incomes. 
 Unlike other gambling:
  1. Lottery outlets get prime space in supermarket entryways and shopping malls, normalising them for the young.  
  2. They have flashy TV shows bringing the "fun" into your home.
  3. Their reputation is cleaner, because from the fact that a portion of the money gets donated to organisations chosen by the government (i.e., a levy or voluntary tax).
But some money goes to help people
Let's be honest, if you want to help an organisation, you donate money directly.  Buying a lottery ticket is not about charity, it's about the dream of changing your life by winning lots of money.  And it makes sense that people with less money are more susceptible to buying what seems like a cheap chance into the big time. That's how all good scams work.

When a small organisation fundraises with a raffle, which is basically the same but with a small prize, everyone understands they are unlikely to win and that their money is meant to help fill a need.  But in a lottery, the prize is big and the donation aspect smaller, and the fantasy and greed dominates - even though the odds are far less.

Like all large pools of money, lottery money is from many people losing a small amount - and a lottery is unproductive.  Every time the lottery rolls around, there's a huge sucking sound in the economy as the masses open their bank accounts into a black hole.

Studies and reports
Just a couple here...
(US) National Gambling Impact Study Commission Commissioner Richard C. Leone stated in June 2001:
“In my view, state lotteries have paved the way for great increases in legalized gambling. They have promoted the notion of beating the odds, they have been able to advertise while others have not, and they have propagated the myth that gambling is good for society in general and the government in particular. Lotteries are perhaps the hardest form of gambling to justify in terms of their costs and benefits. The best studies all point in the same direction: Lotteries prey on the poor and the undereducated.”
A study examining the Georgia state lottery revealed households with an income of less than $20,000 spent $250 a year on lottery tickets, while households with an income greater than $40,000 spent only $97 a year.
I could easily go on.  Whenever anyone looks deeply into lottery patterns, they turn over the same ugly facts - those who can least afford it spend the most - in absolute terms and percentage of income.

Yes, but I could be a big winner? How cool is that?
You'd think. But the majority of big winners blow the lot within a few years.

Why?  The average person doesn't know what to do with lots of money.  The big players are generally even less savvy than average (they're gambling on the lottery).  Often, prizes are in the form of expensive consumer goods like cars and houses that require upkeep to maintain their value.  Generally, again, these people are more likely to have friends and family also in need of money.  And money disagreements are the #1 cause of relationship breakups.

The lucky big winner is instead an accident waiting to happen, and you are welcome to Google for the innumerable references to the horror stories, not only involving money but the tragic breakdown of families. 

Why doesn't winning make them happy?
For minimalists, this information will not be a surprise.  Above the amount needed for comfortable living, it's been consistently shown that money does not buy happiness and brings its own problems.

And your money used to belong to a lot of people with not enough - who have been conned through ads to buy into the dream.  You have benefited from an organised scam.  Is that OK?  Most of these people have already lost several rolls in life's lottery compared to you.

Of course, if you won, perhaps you would be different.  Perhaps you think you wouldn't change really, and that your friends and family would simply wish you joy in your new lifestyle, no strings attached.  Perhaps you can beat the odds again, if you've done it once.

But a ticket doesn't cost much!  Chill...
The economy is not treating many of us very well right now.  Even $10 each week gambling on the thrill of a lottery could instead be:
  • organic produce instead of the usual
  • about 5 kgs of flour, rice, or oats for your pantry
  • craft supplies for the kids
  • rented movie for a date night
  • donation each week to a charity you choose as a family
  • $520 lump sum payment toward debt
Inspire me!  Tell me what you can do with a small amount of money that would bring extra joy to your world...


  1. I used to dream about winning the lottery (or getting a large inheritance from a mysterious far-away relative LOL!) though I have probably only bought a lottery ticket a handful of times :)

    But funny thing has happened since I have simplified my life. I realize I don't particularly want all that money. We have everything that we need, I'm able to stay at home, my husband works 4 days a week.. By choosing to live simply and not want the big fancy house, designer furniture and clothes and yearly vacations around the world, where would I need the money? Okay I could realize my sister's dream of starting a shelter/starter home for single moms, but that is not a personal need of mine.. I'm praying for it to happen some other way (that would be more likely than me ever winning the lottery!)

    I have still heaps and leaps to go in learning to be sensible with money, being an all-or nothing person (and with money it has tended to all rather than nothing)

    One tip that comes to mind is to invest the 10$ in as a micro loan! It's an awesome charity that actually gives your money back, as the recipient has their business up and running and pays back the loan. And it's fun to choose what enterprises you want to invest in!!! Even small amount will make a big difference!

  2. kiva sounds very cool - will have to look into that. Assuming that DH isn't still playing the lottery :-)

    The dream that lots of money is the solution is compelling. As I was writing, I _still_ fantasised about what I would do if DH did ironically happen to win the lottery, even though I'm so opposed to the concept.

  3. Around here lottery funds go to property tax relief. I always thought it was darkly humorous that the poor people (who typically aren't property owners), by buying lottery tickets, were effectively financing part of the tax burden of the people who owned property.

    A friend of mine in high school went out to buy a pack of cigarettes and a lotto ticket when he turned 18, just because he could. He doesn't smoke (gave the pack away), and he doesn't gamble (although I think he did scratch the ticket off) - he was just celebrating the fact that he'd turned 18 and he *could* buy those things if he felt like it.

    He's one of the few people that's made money on the lotto - the $1 ticket was worth more in enjoyment than it cost, and he quit while he was ahead!

  4. id, it's certainly very dark when people without enough to take care of their own futures spend on contrived dreams.

    Interesting story about your friend - people celebrate becoming an adult in all sorts of ways!