Lottery Question ($220 Mil Georgia Lotto) (1 Viewer)

[Vince Maskeeper]

I have seen dozens of reports listing odds at 76 million to 1. I assume this means that there are 76 million combinations- so couldn't someone buy 76 mil tickets @ $1 each for 76 mil and "buy" the jackpot?

Even if there are 2 winners- you'd still make money (maybe not after taxes, although I guess you could claim the 76mil paid as an operating expense and pay tax only on the profit).

-V

 

[Dax Scott]

If the odds really are 76,000,000:1 then yes, you could theoretically "buy" the jackpot for $76 million.
It just isn't very practical to purchase that many tickets, especially since you have to pay the $76 million up front, and if you end up sharing the jackpot with anyone, you could actually lose money after taxes.
Another factor to consider is that the estimated jackpot is the total of all payments over 20 or 30 years. Some lottery games allow the payment of a lump sum, but that is usually much smaller than the installment plan. If your $72 million investment is going to be paid back a few million at a time, you'd probably get a better return on investment just leaving it in a savings account!
It's pretty rare for a jackpot to get that large, unless it's one of those games with five normal numbers and a "super" number that dramatically decreases the odds of winning.

 

[Carl Johnson]

I heard a story about a group of people who bought every possible combination in a lottery to do just what you propose and when gaming officials learned of the scheme they refused to pay the jackpot. They claimed that doing so was an illegal attempt to manipulate the system, or something like that.

 

[NickT]

Several years ago, there was an attempt to do that with the Virginia Lottery by some Australian group. They managed to buy something like 75% of the possible combinations. The main thing that kept them from getting all of them was you had to fill out the form for every ticket and that took time and alot of people to do. Stores only have but so many tickets to print out so they had to keep going to different places when the store ran out. I forgot whether they managed to win the jackpot or not, but the state changed the rules on how you can buy tickets to prevent something like that from happening again.

 

[Butch C]

$220,000,000 in a lump sum payment comes out to $79,000,000. If you split the jackpot you actually lose $39,000,000. There are MUTCH better ways to blow $40,000,000 in my opinion.

btw. any Vegas Handicapper will tell you that the potential payoff being lower than the odds is a suckers bet

 

[Vince Maskeeper]

Another factor to consider is that the estimated jackpot is the total of all payments over 20 or 30 years. If your $72 million investment is going to be paid back a few million at a time, you'd probably get a better return on investment just leaving it in a savings account!

Let's assume that you get $144 million after taxes, doubled your money. $72 million at current savings account rates (2-3%) would take about 36 years to reach $144 mill. To double your money ($144 million) in 20 years you'd have to earn about 5%. Plus you'd also have to pay taxes on the interest, and since the taxes we already taken out of the lottery version- assume you'd need to get about 8% interest on 78 mill to actually achieve the same payoff as the jackpot.
-Vince

 

[Scott Merryfield]

And, unlike real gambling, you have no risk of losing everything- rather you risk losing half the money, maybe- at a 3:1 shot at tripling it. Seems like it's a better gamble than most.

What if there are 5 other winners? Or 10 other winners? Then you would lose most of your $78m initial investment.

 

[Leo Hinze]

Don't forget that if you buy all 76 million combinations, you are also going to win a significant amount of money for matching 3, 4, and 5 numbers as well.
But potential winnings, payouts, and odds aside, so far the logisitical problem is too great to overcome.
Let's look at filling out the slips. They have to be filled out by hand. Assume that just filling out the slip takes 10 seconds. It will require over 200,000 man hours or 100 man years (based on 2080 hour work year) just to fill out the slips. How does that sound for a 1984-ish job. 'Here son, your job for the rest of your natural life and beyond is to come in every day and fill out these lottery slips.'
Consider the 200,000 man hours, and keep in mind that this only takes into accound the actual filling in of the little circles. There's still sorting, checking, grouping, etc. Wouldn't it suck if the one combination in all of the 76 million that you missed was the winnig one?
Then once the slips are filled out, there's the little matter of buying the actual tickets. Not to mention the collection of 76 million dollars, because I am pretty sure you cannot buy lottery tickets with a credit card
Then, after the lottery, you have to take the winning tickets to a store to collect your money for small amounts, or to the lottery board for the big ones.
The whole point is that there is a lot of work to do. If you can find people to do it for free, great. 'Hey, would you like to donate your time to helping me win $200 million that you will never see a penny of?"
I could go on, but if you haven't seen the point by now
Leo
"I'm not really a devil's advocate, I just play one on TV."

 

[Dheiner]

If, and unfortunatly it's a huge if, I had $76,000,000.00,

I would have zero interest in the lottery.

 

[Jonathan Burk]

I agree the two things that keep this idea from being feasable are

1. A great risk you'll have to split the jackpot with other winners (wouldn't it be ironic if two people did this on the same lottery?)

2. The logistics of buying and filling out every ticket in time.

As for rich people playing the lottery, there was a CA lottery a few years back where it was reported the Shaq bought several thousand dollars worth of tickets.

 

[MichaelPe]

Umm... what about the time it takes to print each ticket? Do you know how long it would take to print a ticket with just 10,000 combinations?
But, if you had $76 million to begin with, then it would be a lot simpler to just bribe everyone who works at the lottery to "pick" your numbers.

 

[Patrick Sun]

All I know is that I'm a willing payer of this stupidity tax because I've been playing 2 lotto tix for the past 3-4 drawings once the jackpot went over $100 million.

 

[Kevin T]

patrick said it best.

lottery = tax on the ignorant

kevin t

 

[Danny R]

BTW, there was no winner friday. The jackpot is up to over 300 million, with a cash payout of 157 million.

After taxes you'd get a payout of just over 100 million.

BTW, someone mentioned above that if you ran all the numbers you would also get a sizeable payout for having 5, 4, and 3 other numbers in the combination... this is not true. Since the lower payouts come out of the jackpot as a whole, the money you would receive would actually be the same if you were the sole jackpot winner.

Of course if you were not the sole winner of the jackpot, then you would get about 5.25 million more for your share than any other winners who just purchased 1 ticket. But if you had to split the jackpot you just lost a sizeable chunk of change buying the tickets in the first place.

BTW, since an attempt has been made to run numbers in the past (the austrailian incident), most lotteries today require you to actually be present to buy a ticket, or charge a service fee if they allow online purchases. Also the machines purposely slow down the rate at which tickets can be printed out (much like the old unix DSS (?) encode procedure had a time delay built in to limit someone from running dictionary checks on passwords). This makes it extremely difficult to run them.

 

[Ken Wagner]

The sad part of all this is the money is supposed to be used for education. If that is the case, why are schools cutting programs, firing teachers, and closing down? With all the money taken in from lotteries and casino gambling, no school should be short of money for anything. I know my taxes haven't gone down any since these so called education helpers have come along. It's just another way for organized crime and politicians, try to figure out who is who, to "legally" make money.
Sorry for the rant but sometimes the truth hurts.

 

[Leo Hinze]

lottery = tax on the ignorant

How is spending $1 for the chance at winning $300,000,000 ignorant?

 

[BrianB]

http://ucsu.colorado.edu/~bsid/lottery.txt
Good rant on why the Lotto is a poor investment.
Link Removed
A letter from an economist arguing against an Alabama state lottery.
Sure, putting an occasional dollar in it when there's a super high jackpot is fine. Treat it as a laugh, don't expect a return. The problem is that the people making up the jackpot most weeks (when it's MUCH smaller than $300m) are the people that can usually ill afford the cash.

 

[Kevin T]

How is spending $1 for the chance at winning $300,000,000 ignorant?

if you do it once, i would say it isn't. however, it's been my experience that nobody who has ever played the lottery has played it just once. well, at my mother's request, i bought a ticket when i was in atlanta last year so i guess i'm the only guy who has ever only bought one ticket the odds of you winning are insanely ridiculous. so much so, that any educated person would realize they have almost no shot in hell and hence they spend their money elsewhere. when you buy a lotto ticket, you fill out little bubbles, fork over some cash to jane the toothless gas station attendant, and then wait for the numbers on tv or in the paper. how fun / rewarding is that? if you're gonna blow money on long shots, go to a casino. at least casino gambling is more entertainment / free liquor so there is instant gratification.
kevin t

 

[Danny R]

The sad part of all this is the money is supposed to be used for education. If that is the case, why are schools cutting programs, firing teachers, and closing down? With all the money taken in from lotteries and casino gambling, no school should be short of money for anything.

The amount of money brought in does not cover all costs in the educational budget. In Georgia the state spends about 150 million each year from lottery sales (its spent about 1.5 billion total thus far over the past 10 or so years we've had it). That is miniscule compared to the 6 billion normally spent each year for education from the state budget.
Lottery expenditures also are specifically targetted in Georgia toward Scholarships (students get to go to college free), Pre-K programs (help those kids to stop failing kindergarden), Capitol Outlay and Technology (computers in schools/new schools), and Teacher Training in Technology. Most of these programs are new, or were not funded very well prior to the lottery.
I know my taxes haven't gone down any since these so called education helpers have come along.
This is what you absolutely do NOT want to see happen. One of the laws in Georgia states that no program currently funded by the state will have that money funded instead by the lottery.
This is in my opinion an essential compromise enacted because in some states the legislatures started spending the normal educational budget on other items since the lottery was bringing in so much money. Then when lottery sales waned, the schools no longer had budgets and actually turned up worse than before. Lottery income can vary greatly each year - Georgia is actually the only state thus far to have constantly increased lottery sales each year... although this year looks like it will prove to be the end of that.

 

[DaveF]

The original question (can you "buy" the lottery) seems to be two questions:
1) Theoretically, can you buy the lottery (guarantee a win)?
2) Practically, would it be worth doing?
The concensus on (1) is Yes, you could buy every number combination, and win.
No agreement on (2), so here's my own thoughts.

Let's assume that you get $144 million after taxes, doubled your money. $72 million at current savings account rates (2-3%) would take about 36 years to reach $144 mill.

Anyone investing $72M is not getting a paltry 2% from their local bank. They are striving for >10% return, which will double your $72M to $144M in 7 years; the stock market's historic growth is 11%.
At best, you've got 2:1 winnings, and could easily lose 1:3. It would be easier and more lucrative to invest the money.
As for "investing" in a lottery, I heard a commentator put it this way: You have $1M, which you invest in the lottery. You put all the money into lottery tickets on day one. You then reinvest all winnings into new lottery tickets every day following. You will have lost all million dollars in a month.
I'll stick with my 2% savings rate