Stop Buying Lottery Tickets!!!
13-36-45-57-67, Mega Ball: 14
Those right there were the winning numbers to the mega millions jackpot for over $1.337 billion, which was the third-largest lottery prize in the U.S. The person that won this jackpot instantly joined the top 1% in the U.S. for spending just a few bucks on a single lottery ticket.
The first lottery in the U.S. was launched back in 1994, and since then, the lottery ticket industry has grown astronomically, with lottery ticket sales clocking in at roughly $105 billion last year.
Buying lottery tickets may seem like a fool-proof way to earn millions of dollars, but statistically, it’s just not. You have a 1 and 302 million chance of buying the one ticket that contains the winning numbers. Now I would consider myself to be quite the risk taker, but even I’m not a fan of those odds, however, millions of people are, with 1 in 5 people in the U.S. believing that winning the lottery was their best shot at becoming rich, which was found in a survey conducted by the Consumer Federation of America.
And according to research performed by Bloomberg, the average lottery player “wins” $0.60 for every $1 they spend. Every day, people are being cheated out of their money by spending it on lottery tickets, so what exactly causes them to do this? Well, everyone has a different reason, but it all comes down to one thing, and that’s the hope that lottery tickets provide them with.
Of course, most people aren’t delusional and understand that their chances of hitting the jackpot are nearly impossible, but what if on the off chance they did? When people see the jackpot at hundreds of millions of dollars, they imagine all of the things they could do with that money. They would never have to worry about money again, and neither would their friends and family, and that’s what compels them to keep spending their hard-earned money on lottery tickets.
But here’s the kicker, about 70% of people that win the lottery spend all of the money they won in less than five years. You can have what seems like an unlimited amount of money, but really, the secret to becoming rich is knowing how to invest your money, which requires you to be financially literate and, unfortunately, the education system has failed to teach us how to do this. And it's not all of the hard-working teachers out there that are to blame for this, instead, it's the people that are in charge of planning the curriculum, but I'll save that rant for another blog.
Based on my calculations, adults in the U.S. spend on average $407 a year on lottery tickets. If you decided to invest that money every year into an ETF that tracks the S&P 500, which grows roughly 10% every year once you take inflation into consideration, you should have around $215,000 in the next 40 years.
And listen, investing $407 every year isn't going to make you a millionaire, but there are other things that we spend our money on that we really don't have to. If you’re able to figure out some ways to cut back on your expenses and invest that money instead, just IMAGINE the long-term wealth you could build for yourself and your loved ones!!!
Although the title of this blog is “Stop Buying Lottery Tickets” my intention isn’t to persuade you to completely stop buying lottery tickets because I would be a hypocrite if I said that I’ve never bought a lottery ticket before. In fact, here’s a picture of me buying my first lottery ticket on my 18th birthday, which I only did for the occasion.
If you want to spend a couple of bucks on lottery tickets every now and then, that’s completely fine. Because at the end of the day, you have the freedom to do whatever you want with your money.
The purpose of this blog is to hopefully make you realize the importance of investing your money to build long-term wealth, and the best way to do that is to invest it in assets that will grow over time, such as stocks, real estate, and commodities.
And if there's one thing that I really want to you take away from this blog, it's to NOT wait because the sooner you start investing, the more time your money will have to grow.
This may not sound very exciting to you, but what investing your money can guarantee that spending your money on lottery tickets can’t, is being able to build your wealth in the long-term, which I know that all of us will be able to achieve one day if we take the necessary steps to do so.
