Okay. I admit it. I buy lottery tickets. It is some of the cheapest entertainment I can buy. (The best entertainment is free, but that’s another story.) Tonight is the drawing for the largest lottery jackpot in US (world?) history. Tomorrow is my birthday. So, I just gotta. I just gotta. I also gotta be real, and realistic. Numbers are real, and here’s how I look at the numbers.

The odds of winning are so small that there’s no doubt; buying a lottery ticket is a gamble, and a bad one. Articles, blog posts, tweets, and every human communication have enough calls for people to wise up and not buy the tickets. How could we be so foolish?

1. Being foolish is human. If we were always reasonable, logical, methodical, and analytical we’d all be Vulcans and predictable and dull. It is okay to be a little frivolous occasionally.
2. Expecting the same thing repeatedly but expecting different results is one informal definition of insanity. I think the majority of people are sane, and that we all have quirks that make others question our sanity on, but that’s part of being human. The seeming insanity is part of our daily lives. That’s one reason I blog on PretendingNotToPanic.com; because things really are that strange and weird. As Sun Tzu pointed out in the Art of War, people need an outlet or they react irrationally. If hard work, frugal living, and honesty don’t seem to be leading to success the way they did, maybe a fling at a ticket is a relatively small risk with the prospect of a big reward – a reward they can’t find anywhere else in their lives.
3. As entertainment, a $1, $2, or $3 ticket is far less than the price of a movie. A movie costs more and is over in less than 3 hours. The ticket, however, can inspire dreams for days. One friend makes the dreams last for weeks and months because he only checks his tickets long after he bought them. It is the lottery version of Schrodinger’s cat. As long as he hasn’t checked the tickets they could be winners or losers, so he might as well enjoy the dream of at least one of them being a winner.
4. Lottery tickets are a voluntary tax, and because the money is collected by the state and not the federal government, a buyer can know that the money isn’t going to defense spending, or whatever federal program they may disapprove of.
5. For a dollar or so, I know I am contributing to someone who is about to have the best day of their life, at least monetarily. I want it to be me, but even if I don’t win, it is nice knowing that someone will receive more than enough – something that is happening far too infrequently.

The odds of me winning the lottery are small. Millions to one are some of the smallest odds we voluntarily deal with. The odds of someone winning the lottery are much higher. Jackpots aren’t won every time, but they are won often enough that the odds of any particular jackpot being won are probably more like dozens to one, maybe less. There’s nothing that differentiates one person from another; so, if someone is going to win, it could be me.

As I said, lottery tickets inspire dreams. What would I do if I won? Considering how much I consider finances (have you read my book, Dream. Invest. Live.?) I tend to pull apart the possible winnings in specific ways – all of which are like any plan, something to be invalidated as soon as it is tested.

Because it is my birthday, I have one ticket each for Powerball, Mega-Millions, Lotto, and Hit 5.

• Hit 5 current jackpot = $100,000 ~ Hey, that means someone won the previous drawing. That could be me! It could be my friend who rarely checks his ticket. Congratulations to whoever won. With $100,000 I would take a vacation, and not quit my day jobs; though I would work one less day per week (My Rule Of 7). Two or three immediate house repairs would be accomplished. The truck would be fixed. The 2014, 2015, and 2016 taxes would be paid. I’d pay off the credit card. The remainder would be set aside for living expenses and invested. There’d be at least one vacation, probably sitting in a cabin or hiking.
• Lotto current jackpot = $4.9M ($2.4M cash option) ~ The annuity would be nice, but the cash option would be definitive. All of the above bills are paid. Everything is repaired, even me. Retirement returns. Some luxuries come back into my life, but very few extravagances. I might not even move – well, maybe. There’d probably be a boat in there somewhere. I’d definitely do a lot more skiing. I also know how quickly bad luck can make a couple of million evaporate; so I’d remain somewhat cautious. I’d still
• Mega Millions jackpot = $15.0M ($9.2M cash option) ~ At that level the annuity becomes attractive. Can I live on ~ $43,000 a month? Yep. That first $43K would vanish within a month considering my Dammed Plans, but a few months later surpluses would accumulate. Of course, I do have worries about the economy and currencies; so maybe I’d take the lump sump, give away a large part of it, and live comfortably. Oh yes, and I’d probably spend a lot less time investing. After there’s more than enough money, quit spending time on trying to make more. There’s a word for that.
• Powerball jackpot = $1.5B ($930M cash option) ~ Yowza. No wonder people are buying tickets. For a little bit more you can win a hundred times more. The Mega Millions jackpot is more than enough; but what a story it would be to win. I might even continue the blog just to document the progression I’ve written about before: from Middle Class to Millionaire to Muddling By to Mama Mia! And yes, I suspect I’d give away almost all of it. I’ve already sketched out the philanthropy, the key people, and the timing.

I know rich people. I was one for a while. One of the saddest things is to realize how much damage too much money does to a person’s perceptions of the world, the defenses they have to raise, the lack of compassion shown to them. While it seems that money can make all the problems go away, no matter where you go, there you are. Money becomes a multiplier. Positives are amplified. Negatives are amplified. I’ve witnessed the realities of the chart that shows happiness increasing as money increases, but only to a point. After an income of about $75,000 per year, happiness can fall quickly unless a person avoids the dysfunctional conventions within our society. That’s a tougher task than it seems, especially if you care about what others think.

Of course, even this post is just an example of the main benefit I know I’ll receive from buying a ticket. I get to play with the idea of winning. That’s something I couldn’t do as well if I hadn’t bought a ticket.

Decades ago a friend who was equally schooled in math (we both had masters in aerospace engineering) pointed out that buying a ticket instead of buying none increased the odds of winning infinitely, to a very small number that was at least greater than zero, and that the odds were so small that doubling the small odds didn’t increase the odds much. The solution: buy a ticket, ignore the probability, enjoy the possibility, and be real.