Why you should give me $10 so I can give you back $5

If someone came to you and said that if you gave them 10 dollars of your hard-earned money, you could get five dollars back, you wouldn’t do that. Why would you? You are giving away five dollars for no reason. No one in the right mind would do that, even though you are certain to get half of your money back. That is 100% certainty of only losing half of your money. How many of you spend money every week with at most, a 1.75% chance of getting money back, and not only that, only a 1.75% chance of getting $10 or $5. Why is having 1.75% less chance of getting money back more attractive than having 100%? Because one is a simple transaction while the other is the government approved 6/49 lottery.

Going on the odds of winning, to get $10 dollars back from 6/49 (which I am just using as an example) you will need to spend on average $114. That is if you only gamble the minimum of $2 each time. Obviously if you buy 57 lines for 6/49 you should win at least $10 dollars each time but you are still spending $114 for the 1.75% chance of making at least $10.

We all like to feel special, that we are unique and well, one in a million. Well your odds for winning the big one, the millions we all dream about, is 1 in 13,983,816 or you have 0.000000071511238420185200% of a chance. Feel lucky punk? Well do you?

Why do you, me, and millions of other Canadians continue to spend our hard-earned cash on such high odds of winning? It is because we like the whole idea of the gamble? The game of chance, the thrill of seeing the numbers pulled? Why throw our money away on something when we are more likely to hit by lightning, or see the Leafs win the Stanley Cup?

Whenever someone wins the big one, albeit as little (little ha ha) as a couple of million or the really big jackpot, their image appears in the papers, online and on the news. It encourages us to think that if it happened to them, it can happen to us. They fail to show the approximate 488,000 who live in Ontario and who can be classified as having a moderate or severe gambling problem. Nor do they show the millions of, well to put it politely, losers out there who spent their money and received nothing in return.

The reasons why we continue to gamble in our millions, spending billions a year on tickets, scratch cards, break open cards and so forth is that we are all optimists who believe that we are luckier than the rest. The lottery organizations offer us hope, the ability to change our lives, allow us to have what we want, and it will only cost a few dollars. Who wouldn’t buy into that?

It seems that the winning strategy for playing the lottery is to actually not play the lottery and instead either not spend the money at all or to invest it in beer. 24 bottles of Blue costs $30 with $2.40 back. More money back in the long run than the lottery and much more fun in the meantime!

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  1. Loved the Beer Economics at the end there it is a nice touch eh

    And as far as the rest of ya your bang on gambling is essentially a losing game for the most part and the odds are astronomically against you at every turn but the underlining factor is that it is fun and the thrill of winning keeps them going and going and going so …… what do you do ?

  2. Peter Atkinson

    For a long time I was one of those people who didn’t buy lottery tickets. I liked the saying “The lottery is a tax on people who are bad at math”.

    But now I think the prospect of the big lotto win is outside any logical analysis of the odds, and even beyond a misplaced optimism, if only because the potential is so huge.

    I’d suggest that it’s more similar to buying beer as Nathan mentions. Buying a lottery ticket is, at least for the rational and self-aware, like buying a chocolate bar, knowing full well that any short-term gratification will be quickly forgotten and that any long-term gain – perhaps by saving the money or donating it to charity – just isn’t a consideration. The cost of a ticket is usually a small amount of money that isn’t likely to be missed, which is why higher ticket prices tend to be associated with charity lotteries; if the price of a ticket is high enough to matter, there had better be a feel-good factor to keep the losing ticket holders feel good enough to play again next time.

    Bringing up gambling addiction is like blaming car crashes on the combustion engine. The mechanism of addiction means that these unfortunates would simply have found something else to be addicted to. And by definition, addiction doesn’t enter into an attempt to rationalize lottery ticket purchases.

    You can’t win if you don’t play so, though the odds are long, I wonder if there’s a formula somewhere that might prove that the potential return on the investment means there are worse ways to spend your money than buying a lottery ticket.