Lottery tickets purchase=mental illness?

[Grizz]

I never have, never will buy lottery ticks. It's been referred to as "the idiot tax" and I agree. My inlaws buy $30 per week. Of course you only hear about the odd time that they have won $100, never the losses. It ain't my money, so why do I care?

It drives me crazy when they constantly tell my DW and I how much they'll give us next Wednesday (Jeez thanks), or what type of house or new car they are getting. The way they go on, it's like they actually believe that they are going to win. They aren't poor, and dreaming is fine, but is being this enthralled with the lottery and announcing your plans daily some sort of mental disorder? Do some people just not understand odds or statistics? Thank goodness my wife has none of that gene. Any advice on how to tactfully get them to stop talking about their vast winnings that will almost certainly never materialize?

 

[old woman]

I worked with a woman who was "lucky" at bingo. I told her she should start tracking her winnings and what she spent so she could see how far ahead she was. Months later I asked how far ahead she was but she said she didn't like keeping track of it. To her the money spent was probably entertainment but the winnings were winnings. Some people go to Reno or Vegas as a vacation and when they take money to gamble and come back with part of it feel they really won since they didn't lose as much as they meant to.
My mom was going to have the prize patrol knocking on her door, a grand daughter bought her a welcome prize patrol door mat. The doormat wore out but they still haven't shown up.
Most people really know they won't win so do save other money but pay to dream.
I have never bought a lottery ticket but I gamble in the stock market hoping to win big.

 

[Grizz]

I gamble in the stock market hoping to win big.

Me too, but I doubt if either of us puts a bunch of penny stock names in a hat, picks one out, and then triumphantly exclaims "this is the big one!" and then announce daily to everyone in sight what kind of car you'll get and how much you'll share with them when it's a hundredbagger next week.

 

[old woman]

Me too, but I doubt if either of us puts a bunch of penny stock names in a hat, picks one out, and then triumphantly exclaims "this is the big one!" and then announce daily to everyone in sight what kind of car you'll get and how much you'll share with them when it's a hundredbagger next week.

You would be surprised how bad I am when it comes to picking stocks and dreaming and talking about winning. I have about 30 different mutual funds I picked out 14 in 2 days once just divided the money between all the ones I was considering and couldn't decide. I haven't tried penny stocks yet but I have 500 shares of MCD because the first 300 was doing good and it saved researching another company. I have made about 10K just on MCD. I am up over 60K YTD so pretty happy with my random investing. I was asked not to talk about buying a house any more. I keep dreaming of selling my house and buying a nicer one and telling my boyfriend what I am going to get when I am rich.

 

[Bigritchie]

It is a tax on idiots, but better a tax on idiots then on us.

 

[LOL!]

Jason Zweig discusses all this in his new book: Your Money and Your Brain.
You gotta read it, but basically once you win big you are hooked just like you can be hooked on cocaine. Your brain gets re-wired and there's nothing you can do about it.

 

[Sandy]

Do some people just not understand odds or statistics?

Yep. Happens all of the time. Note the hysteria and commotion that often arises about risks in general - remember the pesticide alar?

I am not defending the pesticide, but the relative risk of disease was totally out of proportion compared to the other risks of daily life (getting in the car).

In day to day activities, people process fear and greed automatically and reflexively (limbic system/emotional brain) while evidenced-based reasoned information takes time and conscious effort to work through and understand (higher cortical thinking).

When the hopes and fears are strong enough they override the logic(needed for basic survival). Just gets very distorted in the day to day world.

 

[lazygood4nothinbum]

"the lottery is a government institution & the poor its best patrons." ~~mark twain, notebook #17, oct 1878 - feb 1879

obsession distracts from pain.

as to how to modify the behavior of your inlaws, do you really want to walk down that road?

 

[Achiever51]

I never have, never will buy lottery ticks. It's been referred to as "the idiot tax" and I agree. My inlaws buy $30 per week. Of course you only hear about the odd time that they have won $100, never the losses. It ain't my money, so why do I care?

It drives me crazy when they constantly tell my DW and I how much they'll give us next Wednesday (Jeez thanks), or what type of house or new car they are getting. The way they go on, it's like they actually believe that they are going to win. They aren't poor, and dreaming is fine, but is being this enthralled with the lottery and announcing your plans daily some sort of mental disorder? Do some people just not understand odds or statistics? Thank goodness my wife has none of that gene. Any advice on how to tactfully get them to stop talking about their vast winnings that will almost certainly never materialize?

If they can afford it, and I'm assuming the $30 or so is not a financial drain, and if it makes them happy to dream, I'd let it go.

OTOH, my husband's uncle (now deceased) got caught up in a lottery scam where he was sending hundreds of dollars a month -- that he could not afford -- to some quasi-religious organization that had him convinced that only by sending more and more $$ would he win the big lottery prize. He kept it hidden from family and we only discovered this after he died, but he apparently sent thousands over the course of years to this scam. DH reported it to the local district attorney, and I understand this particular scam was closed down...but probably resurfaced in some other city. At least your in-laws are talking to you!

 

[Kronk]

I've dropped $5 on lottery tickets maybe around 5-6 times in my life. To me, the infrequent purchase of lottery tickets is entertainment. I have a day or two where I can idly daydream about winning $100 million dollars and what I'd do with it. Then I see the results, and realize just how remote the chances of winning are. Still, it can be kind of fun.

 

[Fireup2020]

I spend far less on random lottery tickets than I do coffee (and I am currently drinking coffee brought in from home since I am too cheap to regularly purchase coffee at DD!) It is all about the entertainment factor...the random thoughts of what to do with any potential winnings. When I do go to Reno or Vegas or AC (randomly at that) I have a budget - and stick to it. Sometimes I have spent (read: lost) and sometimes I come home ahead of the game. I don't see the problem if it is not causing someone to not pay for their responsibilities and the individual is saving money elsewhere.

 

[justin]

I never have, never will buy lottery ticks. It's been referred to as "the idiot tax" and I agree. My inlaws buy $30 per week. Of course you only hear about the odd time that they have won $100, never the losses. It ain't my money, so why do I care?

Given enough time, the odds of winning are fairly good.

Consider 30 tickets per week, 52 weeks per year for 60 years. This equates to 93,600 entries into the lottery. Around here, the odds of winning the jackpot are 1 in 146,000,000. Assuming you buy 30 tickets per week, 52 weeks per year for 60 years, your odds of winning once during your lifetime are approximately 1 out of 1,560. Plus, you would get back a small portion of your expenditures in smaller non-jackpot prizes ($1, $5, $10, $100 prizes). 1 out of 1,560 odds to become a mega-millionaire rich beyond your wildest dreams is pretty good in my book. Not that I would blow $30/wk to try to attain this level of wealth.

I play when it gets big, usually in the lottery pool at work. Maybe spend $50/yr between DW and I. The "thrill" is worth it, plus if these other bastards at work ever win the lottery, I don't want to be the guy that didn't win and still has to work!

 

[DJRR]

I always buy one ticket whenever the expected value of a ticket goes over $1. Not too often that the jackpot gets over the odds, but it gives me something to dream about occassionally

 

[DJRR]

Given enough time, the odds of winning are fairly good.

Consider 30 tickets per week, 52 weeks per year for 60 years. This equates to 93,600 entries into the lottery. Around here, the odds of winning the jackpot are 1 in 146,000,000. Assuming you buy 30 tickets per week, 52 weeks per year for 60 years, your odds of winning once during your lifetime are approximately 1 out of 1,560. Plus, you would get back a small portion of your expenditures in smaller non-jackpot prizes ($1, $5, $10, $100 prizes). 1 out of 1,560 odds to become a mega-millionaire rich beyond your wildest dreams is pretty good in my book. Not that I would blow $30/wk to try to attain this level of wealth.

The probability is not cumulative. It is never better than 30 out of 146,000,000 because each draw is unrelated. Just like flipping a coin. Even after 10 heads in a row the probability is still 50% for heads on the next flip. This is how many people go broke

 

[Texas Proud]

I always buy one ticket whenever the expected value of a ticket goes over $1. Not too often that the jackpot gets over the odds, but it gives me something to dream about occassionally

I did this for awhile... but then someone pointed out that with the big numbers, the NPV just does not enter into the equation....

 

[Texas Proud]

To the OP...

I am sure that YOU do things that upset the inlaws / relatives... and they probably talk about it behind your back..

I don't drink coffee, and can not for the life of me see someone buying $20 to $50 a week on drinking coffee as rational... yes, he gets his 'fix', but it seems your inlaws are getting their 'fix' also... it is harmless fun if they can afford it... just put it under entertainment....

 

[kcowan]

I consider a lottery ticket purchase as a cheap way to buy hope for a little while. IMHO I don't need to buy hope but I can understand why some people do.

 

[CybrMike]

Odds of winning the hoosier lotto are 1:12,271,512. Sounds better than the 1:100,000,000+ odds I hear everyone talking about. Plus its up to $50M now. Someone's gotta win.

 

[justin]

The probability is not cumulative. It is never better than 30 out of 146,000,000 because each draw is unrelated. Just like flipping a coin. Even after 10 heads in a row the probability is still 50% for heads on the next flip. This is how many people go broke

I disagree. The probability of success on any given ticket is 1 / 146,000,000 = 0.000000006849315.

That means the probability of failure is 1 - 0.000000006849315 = 0.9999999931506850.

The probability of 93,600 failures in a row (ie - never winning after 93,600 attempts) is 0.9999999931506850^93600 = 0.999359109560.

The inverse of never winning (ie - winning at least once) is 1 - 0.999359109560 = 0.000640890440.

This latter number is equivalent to odds of 1 out of 1,560.33. In other words, over a lifetime of playing $30/wk in the lottery, your cumulative probability of winning one or more times is 1 out of 1,560.

Unless the maths deceive me, which they have in the past from time to time.
0.000000006849315

 

[DJRR]

I disagree. The probability of success on any given ticket is 1 / 146,000,000 = 0.000000006849315.

That means the probability of failure is 1 - 0.000000006849315 = 0.9999999931506850.

The probability of 93,600 failures in a row (ie - never winning after 93,600 attempts) is 0.9999999931506850^93600 = 0.999359109560.

The inverse of never winning (ie - winning at least once) is 1 - 0.999359109560 = 0.000640890440.

This latter number is equivalent to odds of 1 out of 1,560.33. In other words, over a lifetime of playing $30/wk in the lottery, your cumulative probability of winning one or more times is 1 out of 1,560.

Unless the maths deceive me, which they have in the past from time to time.
0.000000006849315

Don't know about your math, but I wish I owned a casino that I could invite you to Just because black comes up 100 times in a row does not change the odds that black or red will come up next time. I understand it is not intuitive, but each draw is unrelated. By your logic if you "invested" $46,795 (146,000,000/60/52) a week you would be guaranteed a win in your lifetime. This is not true.

 

[TromboneAl]

If the chance of heads for one coin toss is 50%, the chance that you will get heads at least once if you flip the coin twice is 75%.

Here are the four possible outcomes:

HH
HT
TH
TT

and in three of four, you get a heads at least once.

But I wouldn't say that spending $93,600 , to get a one in 1,560 chance of winning big is fairly good odds.

Invest that $30/week at 6.5% interest and you get: [FONT=Verdana,] $1,060,842.22

[/FONT]With a 9% return, you'd have [FONT=Verdana,]$ 3,455,837.97 [/FONT]

 

[lets-retire]

Don't know about your math, but I wish I owned a casino that I could invite you to Just because black comes up 100 times in a row does not change the odds that black or red will come up next time. I understand it is not intuitive, but each draw is unrelated.

You are 100% correct, however I have won well over $1000 over the course of a couple months doing just what you say can't be done. Lifetime I am up several thousand. Each night we wrote down the result of each spin and each night the nightly probabilities of winning were approximately the same. With that said the outcome of the individual spin cannot be determined, however the overall results of all spins will approach the expected odds of the occurrence on the wheel. So in your example the odds of each spin is 18 to 37 either red or black and 1 to 37 green on a European wheel. The odds of winning each spin is small, however since overall the results will approach the stated odds that is how one has to bet trends not individuals. Even when we lost our stake we still stood around and wrote results and the outcomes were always about the same for the night.

You can yell and scream about how it can't be done and that I must be under reporting my losses. I won't argue, because I know what I have done and I still have the memories, in most cases (some were lost to the drunken stupor of vacations taken) of weekly vacations taken with the winnings. I also have the memories of depositing the money in the bank to buy cool things. I recently went out to a local casino with the DW and showed her how I won all of the money I did. I forgot how boring it was and I do not have the desire to do it again, even thought I walked out up three times what I carried in, including the losses my wife had.

 

[ats5g]

Jason Zweig discusses all this in his new book: Your Money and Your Brain.
You gotta read it, but basically once you win big you are hooked just like you can be hooked on cocaine. Your brain gets re-wired and there's nothing you can do about it.

For those of the MTV generation , check out Jason's talk about this [halfway down the page]. See also, Jason's website.

- Alec

 

[kombat]

Assuming you buy 30 tickets per week, 52 weeks per year for 60 years, your odds of winning once during your lifetime are approximately 1 out of 1,560.

OK, but if you took that $30/week and invested it in an index fund instead, and that fund returned 10%, then after that same 60 year period, you'd have $5.2 million. Granted, assuming a 10% average rate of return on the market over a 60 year period is a bit of a "gamble," but in my opinion, it's much more likely than 1 in 1,560 odds.

 

[kombat]

Just because black comes up 100 times in a row does not change the odds that black or red will come up next time.

This is absolutely true. However, the more games you play, the more likely that you'll be present when black does hit. If red means a $1 loss, and black means a $50,000,000 win, then someone who plays the game 5 times has a much better chance of winning than someone who only plays one spin and then walks away.

I understand your point - the odds of each individual game do not change. But you can improve your own personal cumulative odds by playing more games.

Say you're in Vegas and you walk up to a bank of $1 slot machines. They all offer 50/50 odds winning, but a win rewards you with $1000 (consequently, it's a very popular casino). You simultaneously put a dollar in 10 machines. Statistically, half of them should produce wins (at $1000 each). Of course, the odds for each individual machine remain 50/50. Meanwhile, your wife selects a single machine (same odds) and puts a dollar in it. Are you claiming that you and your wife both have the same odds of winning $1000?