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Lottery money: How much gets returned?

Topic closed. 5 replies. Last post 11 years ago by Chewie.

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United States
Member #13801
April 14, 2005
48 Posts
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Posted: November 18, 2005, 8:10 pm - IP Logged

In general, what percentage of the lottery money gets returned to the players?

From reading some of the posts here, am I to assume correctly that states, on average, usually keep about 50% and return the other 50%?

For example, let's assume lottery players spent $1 million.  If the states are keeping 50%, then the lottery would keep $500,000 and pay out (or add to the jackpot) the remaining $500,000.

Then, you have to factor in taxes.  Let's assume that the remaining $500,000 is taxed at an average of 30%.  That means $150,000 would be taken taken from the $500,000, and $350,000 would be left for the lottery players.

So, in other words, for every dollar that is spent on the lottery, only 35 cents is being returned to the lottery players.

Is this correct?

 

    hypersoniq's avatar - 8ball
    Pennsylvania
    United States
    Member #1340
    April 6, 2003
    2450 Posts
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    Posted: November 18, 2005, 9:31 pm - IP Logged

    Powerball puts 30 cents of each dollar into the jackpot...

    explained better in their own words...

     

     


    WHY HAS THE CASH JACKPOT GONE DOWN?

    Actually, it is the annuity jackpot that has gone UP. Most people assume that we start with the annuity. We start with the cash jackpot. In the Powerball game, thirty cents of every dollar sold goes into the cash jackpot pool. The difference between the cash jackpot and the annuity jackpot depends on how much we can make in interest earnings. The more interest that we can make, the higher the annuity jackpot. In times of high interest rates, the annuity prize will go UP and the difference between the two jackpot amounts will increase. It is not that we have reduced the cash; but only that we have been able to increase the annuity prize.

    Playing more than one ticket per game is betting against yourself.

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      Sparta, NJ
      United States
      Member #18331
      July 9, 2005
      1977 Posts
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      Posted: November 18, 2005, 9:37 pm - IP Logged

      Every single state has a different law, within their state, to determine what happens to the money.  Those laws are public information.  Multi-state lotteries also follow the rules of the individual state.  That is why CA gets away with paramutual and the other states don't.

      Cheers

      |||::> *'`*:-.,_,.-:*''*:--->>> Chewie  <<<---.*''*:-.,_,.-:*''* <:::|||

      I only trust myself - and that's a questionable choice

        johnph77's avatar - avatar
        CA
        United States
        Member #2987
        December 10, 2003
        832 Posts
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        Posted: November 19, 2005, 7:50 pm - IP Logged

        Lottery Player -

        Each state determines its own payout percentage. The usual is around your quoted 50%, some marginally lower, some as high as 70% in some games, particularly the video variety. See my web site for details.

        gl

        j

        Blessed Saint Leibowitz, keep 'em dreamin' down there..... 

        Next week's convention for Psychics and Prognosticators has been cancelled due to unforeseen circumstances.

         =^.^=


          United States
          Member #379
          June 5, 2002
          11296 Posts
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          Posted: November 20, 2005, 7:21 pm - IP Logged

          Lottery Player -

          Each state determines its own payout percentage. The usual is around your quoted 50%, some marginally lower, some as high as 70% in some games, particularly the video variety. See my web site for details.

          gl

          j

          I've said MANY times, NY Lotto pays back only 38%-40%. Yet so many still throw their money away on this game.

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            Sparta, NJ
            United States
            Member #18331
            July 9, 2005
            1977 Posts
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            Posted: November 20, 2005, 7:42 pm - IP Logged

            Lottery Player -

            Each state determines its own payout percentage. The usual is around your quoted 50%, some marginally lower, some as high as 70% in some games, particularly the video variety. See my web site for details.

            gl

            j

            I've said MANY times, NY Lotto pays back only 38%-40%. Yet so many still throw their money away on this game.

            It doesn't matter if it is 38%, 50% or 10%.  The reason people gamble is for the dream, and the percentage doesn't matter to the winner or the loser, only to the house.  You bet a dollar and you win or lose.  If you win, you get the prize.  If you lose, you don't get the prize.  You can complain all day long, and no one cares what the house percentage is.  Plan on losing, and be elated when you win.  Complaining abot it will make no difference what so ever.

             

            Cheers

            |||::> *'`*:-.,_,.-:*''*:--->>> Chewie  <<<---.*''*:-.,_,.-:*''* <:::|||

            I only trust myself - and that's a questionable choice