Budget

What You Can Do With Your Non-Winning Lottery Tickets

I have a confession to make. I’ve purchased a Powerball lottery ticket. Maybe it was the hype of the Powerball jackpot that filled my Facebook wall, Twitter tweets and every other media outlet. I felt pressured. Okay, I was swept up in the dream.

The problem with lottery tickets is that it promotes an unhealthy money mindset. It reinforces a belief that comfort and financial freedom can be bought and based purely on luck. The self-made millionaires know best.

Phroogal Lottery Ticket - Winning the lottery and dreaming.

Winning the lottery conjures up a glamorous lifestyle of sipping margaritas on the beach, traveling the world in style, buying that dream home and paying off all your debt along with your family and friends’ debt as well.

Imagine never having to worry about money. Of course, when you do have money, you still worry about it. Except your worries go from not having enough to pay bills to worrying about how to lower taxes and get higher investment returns.

I like that the lottery inspires people to dream but the negative side of the lottery is its ability to distort people’s retirement reality. Buying lottery tickets is a belief that one is taking control of one’s future. You can proudly say you did something. You took action and it only cost a dollar.

The truth is…the lottery is not your path to retirement.

A few years ago, a financial educator stated that “80% of people believe the lottery was their path to retirement.” I wanted to see if there was any truth to this statistic. I decided to see how many people I came in contact with who believed in the “luck of the draw” as the best way to retirement. I found that 70% of people (100 random people surveyed) believed the lottery was the only way they could retire with any comfort.

The reality is that you would have better “luck” with these odds than winning the lottery:

Phroogal Winning the Lottery and Dreaming

Spending a dollar or two to win the lottery doesn’t seem like a budget buster. We’ve heard the Starbucks coffee example of how spending on little things do add up. That example is similar to lottery spending. If you spend $10 per week on lottery tickets, that is $520 a year and $5,200 in 10 years without interest. However, I do know people who spend $20 per week on the lottery. That’s about $1,040 in a year and $10,400 in ten years.

I’m not going to rail anyone on spending a few dollars if it gives them hope for a better tomorrow. But, instead of igniting the dream to only win the lottery, I hope it starts the conversation about savings and retirement.

Just like you took the time to get into your car, drive the mile to the 7-11, wait in line and buy a lottery ticket. I hope you take the time to write up your dream lifestyle, analyze your spending, create a budget, start saving for emergencies and other dream purchases.  If you purchased a ticket with your coworkers, it’s a good time to start thinking and using the many benefits offered by your employer.

Read more >>> How to Ask Your Boss for a Raise

Remember “a dollar and a dream” sounds hopeful but “a dollar and a savings plan” is hope.  You can save your dollar and invest in your future not on chance.

But, like many of you, I used to purchases tickets often. In fact, when I sold my car in California in 2011, I found $200 worth of lottery tickets that I never even bothered to check.  I had $200 littered in my car.

So what can you do when you have the itch to play the lottery?

First, buying more tickets doesn’t necessarily increase the likelihood of winning. If you think spending $100 might increase your odds, think about what expenses you could be paying or what debt you could pay down instead.

Second, go ahead and play but create that budget. Analyze your income and expenses and allow for “fun” discretionary items. If you have a budget, keep the lottery spending within the discretionary buckets. Don’t spend money on lottery tickets you’ve allocated to other dreams.
.
Read more >>> How Dividing Your Savings Can Help You Save

Last but certainly not least, have fun dreaming about the life you could have but start taking action on what you can do to achieve that lifestyle. The lottery ticket is a symbol of the possibility of financial bliss.  It’s seen as a piece of paper that can save us from our financial stresses. It is a visual representation and so is a budget.

I will argue that the lottery ticket can be a visual representation of your lifestyle and financial goals. A symbol to make you think of the reality of your situation and creating a plan to get closer to that dream lifestyle.

What you can do with your lottery ticket?

You’ve purchased that lottery ticket.That ticket represents what you hope to remedy and gain. You’re dreaming of the wonderful financially stress-free lifestyle. The first step in managing money is to acknowledge your true financial situation and if you’re holding on to lottery dreams than it’s time to assess your finances.

Write down your lifestyle goal. Take that lottery ticket and hold it. Imagine the life you want to live.

Write down your financial goals. Financial goals are things and experiences tied to money such as a home, vacation, debt repayment, etc. This is the process of outlining goals that are important to you.

Use the lottery ticket to help you acknowledge your true income, expenses and debt. You are now completing the first part of budgeting. Budgeting is the other set of numbers that can help you achieve your goals.

I will go out on a limb and state there is nothing wrong with buying lottery tickets and there is nothing wrong with buying $3 coffees. However, if these small purchases are not affordable in your situation or causing you to hold onto an unhealthy money mindset, it’s time to make some drastic changes.

So have you bought a lottery ticket lately?

Resources: Read more on playing the lottery responsibly.

Sign up for our newsletter

Like this article? Sign up for our free weekly newsletter and we’ll send you an email of our best blog posts to help you live your dream lifestyle.

Show More

Jason Vitug

Jason Vitug is founder at phroogal, creator of the award-winning project the Road to Financial Wellness, and author of the bestseller and NY Times reviewed book, You Only Live Once: The Roadmap to Financial Wellness and a Purposeful Life.

Related Articles

6 Comments

  1. I buy at least one lottery ticket per week cause you just never know. You have to play to win but I get what you’re saying about focusing on budgeting. I do budget but I also allocate a dollar for a dream.

  2. I’m more upset that there’s so many people who can’t afford just one or two dollars a day on lottery tickets than the fact that there are people who are addicted to them. I know that for myself I have bought scratch tickets every once in a while lately simply because I’m an extremely over-educated factory maggot ( I would have used the actual word for my job title, but I wanted to keep the vulgarity to a minimum on this post ) who will never get a decent job no matter how hard I work to better myself.

    Don’t get me wrong. I buy them knowing that the odds of them getting me more money than I paid for them is very small, and the possibly of them making me enough money to significantly improve my life is so small it can only be seen in an electron microscope. However, I also realize that my other option is to just accept that I will rot this way and, take your advice save the money so that I can have a whopping $36,000 by the time I am 70 assuming that this hell doesn’t kill me long before then.

    While I agree that trying to win the lottery is pretty futile, and almost everyone that ever does end up actually paying more in tickets than they ever win, I guess what I’m trying to say is that I wish these anti lottery blogs would give a little more advice than “save the money instead”. Some of us honestly do it because we just don’t have enough coming in for that to be feasible or we are stuck in a job or line of work we hate that much that we can’t wait for that many years to start dreaming.

    1. You’re right it’s about knowing where you stand and actually having a plan. We aren’t against the lottery as you can read from the post but we just want you to have the money conversation with yourself. Sure, it might be okay to throw in a dollar or two towards the lottery but are you throwing in at least 1% into your company 401(k) or contributing to an IRA.

      We’re about achieving dreams not living in fantasy.

  3. Yes – I know the chances are pretty close to none but I will join if there is a pool at work on once in awhile on a whim because the fantasy of winning can be part of my entertainment budget – LOL.

    1. Nothing wrong with joining in a pool at work. Just as long as you don’t put your own savings and investing in the backburner. I do believe a dollar can help us fuel a dream and whether or not we win or lose, if we take action, we’re further ahead then most people.

Leave a Reply

Your email address will not be published. Required fields are marked *

0 Shares
Share
Pin
Tweet
Share
+1
Share