Win the Lottery - Your Retirement Strategy (or maybe not)!

Reply #4

Orange71 — Thu, 21 Jul 2022 21:28:52 GMT

Yep, good point. You'll get something back for lower-tier wins.

Also, you gotta love how the (U.S.) income tax system works on this. You pay top marginal rate on all net wins, but can't deduct any net loss, and your (gambling) losses only offset against wins for losses within the same calendar year. If you win the PB or MM Jackpot in a state like California, you will probably be paying ~55% tax (combined State and Federal). Next thing will be The Bern and Pocahontas going after Social Securit... [ More ]

Reply #3

db101 — Thu, 21 Jul 2022 20:30:58 GMT

Nice table. Your costs will be lower than what you posted becaus you can recoup some expense from small prizes won, which you can guarantee by judiciously picking numbers to cover all Powerballs and small subsets of white balls.

Plan B is to take up meditation. Namaste.

Reply #2

Orange71 — Thu, 21 Jul 2022 18:32:43 GMT

Specifically, P = 1 - (1-p)^(1/p) for the Mean value of N. For Powerball, p = 1 / 292201338, and Mean N is 292201338, so P (cumulative probability) for Mean N is approximately 0.6321, or 63.21%.

Reply #1

Orange71 — Thu, 21 Jul 2022 18:13:35 GMT

You might be wondering why N(50%) is not 292201338, where 292201338 is the number of possible combinations in the Powerball. It turns out that number is the Mean (or average) of N. Specifically Mean = 1/p, where p is 1/292201338 in our case. The 50th percentile is the Median of N, so clearly different with a value of 202538535. In other words, there is a 50% chance you will win the Jackpot (or, rather, your share of it) on or before 202538535 tickets purchased. The fact that the Mean is much gre... [ More ]

Win the Lottery - Your Retirement Strategy (or maybe not)!

Orange71 — Wed, 20 Jul 2022 21:22:56 GMT

Suppose you just turned age 25. You look around at the state of the world and realize it's a dumpster fire : Soaring inflation, completely dysfunctional government, war in Europe, climate going haywire, financial markets tanking, flying anywhere is a nightmare, COVID might be making a comeback, you just had a bad relationship break-up, AND, last, but not least, the U.S. President is doing air handshakes (caught at least twice on camera)!. Is he seeing a ghost? .

You've decided on a retirement... [ More ]