Next Time You Want to Buy a Lottery Ticket, Do This Instead

If you’re reading this, you definitely didn’t win last night. Sorry.

American adults spent an average of nearly $313 each on state-run lotto contests in 2016, according to U.S. Census data. That's more than the typical household spent on milk, fresh vegetables, fresh fruits or reading materials.

Collectively, Americans shelled out about $72.7 billion on lottery tickets during that year, but most players got nothing for their gamble.

“The probability of winning a significant lottery prize is so small that we can state with confidence that the lottery win will not arrive,” says Stephan Unger, assistant professor of economics at Saint Anselm College in New Hampshire.

Investing — real investing — brings much better results. You might be surprised just quickly and impressively lottery dollars could grow if invested instead.

Losing out on billions a year

MoneyWise.com finds that if Americans had decided to put all of their lottery money into stocks in 2016, that $72.7 billion would have grown to $98.9 billion just by the end of 2017. That's a serious gain.

The average U.S. adult spent $312.86 playing lotteries in 2016. Investing that money in stocks would have turned it into more than $425 by the end of 2017.

By “stocks,” we mean the most basic kind of stock investment: an S&P 500 index fund that owns a piece of each of America's 500 largest companies. Our math is based on S&P 500 returns for 2016 and 2017, assuming dividends were reinvested.

Lottery spending vs. investing that money, by state

On the table below, find out how much money the people in your state are pouring into lottery tickets in a typical year, and see how that money could grow in a relatively short time if invested instead.Then, do yourself a favor and think twice the next time you find yourself standing in the lottery line at the supermarket.

(Alabama, Alaska, Hawaii, Mississippi, Nevada and Utah are not included in the table because those states don't have lotteries.)

Full story at Moneywise.com