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The Lottery Should Pay More Than 50% In Prizes To Lottery Players.

Topic closed. 41 replies. Last post 2 years ago by THRIFTY.

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NY
United States
Member #121961
January 21, 2012
3157 Posts
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Posted: June 26, 2014, 12:49 am - IP Logged

THE LOTTERY IS IN BUSINESS TO MAKE MONEY.

NYL could pay back 95% and still make a billion in profit.

    haymaker's avatar - Lottery-012.jpg
    Egg Harbor twp.south Jersey shore
    United States
    Member #112968
    June 29, 2011
    3856 Posts
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    Posted: June 26, 2014, 10:52 am - IP Logged

    A lottery is a “Zero-sum game”. What one group of participants gains in cash, the other group of participants must lose. If we made a list of all the participants in a lottery, it might include:

    1) Federal Government (Lottery winnings are taxable)
    2) State Governments (Again lottery winnings are taxable)
    3) State Governments (Direct share of lottery ticket sales)
    4) Merchants that sell tickets (Paid by the lottery organizers)
    5) Lottery companies (Hint: They are not doing all this for free)
    6) Advertisers and promoters (Paid by the lottery companies)
    7) Lottery ticket buyers (Buy lottery tickets and receive payouts)

    The winners in the above list are:
    1) Federal Government
    2) State Government (Taxes)
    3) State Government (Direct share)
    4) Merchants that sell tickets
    5) Lottery companies
    6) Advertisers and promoters

    And the losers are:
    (Mathematically challenged and proud of it). By Durango Bill

    Thrifty, good list. I see the feds have 1st place and they add nothing to it, only take.

    same for states w/ regard to their state.

    The others on the list are at least doing something

    The feds win every JP without ever contributing a penny !

    Extraordinary Popular Delusions & the Madness of Crowds    -- Charles Mackay  LL.D.

      WIN  D's avatar - q05Q0
      Stone Mountain*Georgia
      United States
      Member #828
      November 2, 2002
      10491 Posts
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      Posted: June 26, 2014, 12:29 pm - IP Logged

                     The State governments are the only ones that will allow themselves .....to all get together and price fix.

       

               Mark my words ......one day a state government will break ranks. ONE will go out on their own and offer higher payouts    $$...and others will follow.

              It will most likely come from a State Lottery that was losing money and about to default. What will they have to lose at that point? 

                                                     It will happen on their way down and out for the count ....and in complete finical desperation.

       

                                                                                 Greed/and the desperation to survive ......will out. Naughty 

       

       

      The only real failure .....is the failure to try.                               

                                    Luck is a very rare thing....... Odds not so much. 

                                    Odds never change .....but probability does. 

                                                                                             Win d    

        bobby623's avatar - abstract
        San Angelo, Texas
        United States
        Member #1097
        January 31, 2003
        1394 Posts
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        Posted: June 26, 2014, 1:24 pm - IP Logged

        The feds win every JP without ever contributing a penny !

        I believe the only time the federal government gets a share is when someone wins $600 or more, and has to pay additional income taxes.
        The feds get nothing if there no winner of $600 or more.
        In Texas, state legislators once decided how much players received. The got greedy, upped their share and nearly caused the
        lottery to go broke due to reduced scratch ticket sales.
        They later recognized their error. However, they then gave lottery officials the power to decide how much the state receives.
        Unfortunately, Texans who buy scratch tickets don't know what percentage is devoted to winners.
        Players can learn how many tickets are printed, the number of winning tickets and amounts.
        I guess if they really want to know what the player share is for a particular game they can do some math and get some rough estimates.
        As far as I know, there is no list published that specifically gives an official percentage for individual scratch games, but the state gets
        the most.

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          Marana AZ
          United States
          Member #145341
          August 3, 2013
          178 Posts
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          Posted: June 26, 2014, 4:58 pm - IP Logged

          The amount of payout isn't set by law in all states. Most follow "standard practices" which is minimum 50% but if they wanted to, legally they could reduce it. Massachusetts has the highest spending mostly because they have the highest payouts. IMO spending doesn't matter unless you take into account the payout. If I the player can spend $861 and on average, get back $619 of it, that is still better than spending $470 in Georgia and on average only getting back $296 of it. The Mass. Lottery has even publicly admitted that their high payouts are what earn their high sales.

          The game payout I am speaking of does not factor in overhead. It is determined by dividing the total value of all prizes into the total cost of all tickets to the players. So a game that doles out $50 million in prizes out of $75 million worth of tickets would have 66.67% payout. The overhead and cost of manufacturing the tickets is deducted from the gross revenues. Now overall (across the portfolio of all offered games), the total payout will typically "averaged" less. Lotteries have low overhead with draw games and they use lower payouts in these games to help pay the overhead on higher payout games (the irony I spoke of). You can find plenty of games with payouts higher than 70%, and if you played only those games over time your payout would be higher than the overall. The payout percentage that the lottery and media quotes is simply an average of all their games.

          Do you have a link to support your statement that most states follow standard practices instead of state statute? My search has turned up nothing like that. For example, Massachusetts law states "the payment of prizes to the holders of winning tickets or shares which in any case shall be no less than forty-five per cent of the total revenues accruing from the sale of lottery tickets". See: https://malegislature.gov/Laws/GeneralLaws/PartI/TitleII/Chapter10/Section25

            LottoMetro's avatar - Lottery-024.jpg
            Happyland
            United States
            Member #146344
            September 1, 2013
            1129 Posts
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            Posted: June 26, 2014, 5:16 pm - IP Logged

            Do you have a link to support your statement that most states follow standard practices instead of state statute? My search has turned up nothing like that. For example, Massachusetts law states "the payment of prizes to the holders of winning tickets or shares which in any case shall be no less than forty-five per cent of the total revenues accruing from the sale of lottery tickets". See: https://malegislature.gov/Laws/GeneralLaws/PartI/TitleII/Chapter10/Section25

            I never said that lotteries follow standard practices instead of statutes. As you pointed out it can be explicitly stated. But in some states the statutes do not specify a proportion of sales required to be withheld or paid out. Instead, they say something in effect to "lottery commission will determine" or "according to fiscal year revenue plan" yada yada.

            If the chances of winning the jackpot are so slim, why play when the jackpot is so small? Your chances never change, but the potential payoff does.
            If a crystal ball showed you the future of the rest of your life, and in that future you will never win a jackpot, would you still play?

            2016: -48.28% (13 tickets) ||
            P&L % = Total Win($)/Total Wager($) - 1

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              Marana AZ
              United States
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              August 3, 2013
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              Posted: June 26, 2014, 5:37 pm - IP Logged

              South Dakota's Video Lottery has a payout minimum of 80% and maximum of 92% while their paper ticket games are set to a minimum of 50%. I wonder if that 80+ percent payout is common for video lottery games in other states. If it weren't for the possibility of large payouts on the lotto games, one might conclude it makes more sense to play video lottery or traditional slot machines.

                LottoMetro's avatar - Lottery-024.jpg
                Happyland
                United States
                Member #146344
                September 1, 2013
                1129 Posts
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                Posted: June 26, 2014, 5:41 pm - IP Logged

                I never said that lotteries follow standard practices instead of statutes. As you pointed out it can be explicitly stated. But in some states the statutes do not specify a proportion of sales required to be withheld or paid out. Instead, they say something in effect to "lottery commission will determine" or "according to fiscal year revenue plan" yada yada.

                I forgot to mention this in my response, but I would also point out that even with explicitly-mandated payout/minimum percentages, those are only averages. They can offer 4 games with 30% payout and only 2 games with 80% payout and still be in compliance with the 45% rule. Casinos do the same thing with slot machines. They will have a couple machines with 110% payout and many others with unbelievably awful payouts. Despite this, pretty much any slot is still better than the lottery as far as return goes. They just work faster at extracting your money LOL

                If the chances of winning the jackpot are so slim, why play when the jackpot is so small? Your chances never change, but the potential payoff does.
                If a crystal ball showed you the future of the rest of your life, and in that future you will never win a jackpot, would you still play?

                2016: -48.28% (13 tickets) ||
                P&L % = Total Win($)/Total Wager($) - 1

                  SergeM's avatar - slow icon.png
                  Economy class
                  Belgium
                  Member #123700
                  February 27, 2012
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                  Posted: June 26, 2014, 6:30 pm - IP Logged

                  That old French roulette might still be with the finest games.

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                    NEW YORK
                    United States
                    Member #90535
                    April 29, 2010
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                    Posted: July 13, 2014, 10:45 am - IP Logged

                    NYL could pay back 95% and still make a billion in profit.

                    HOW TO WIN THE LOTTERY BY NOT PLAYING=SAVE YOUR MONEY TO PLAY THE LOTTERY SOMEDAY.

                     

                    "Play less often is the BEST strategy for playing the lottery! That includes playing so "less often" that you never play! THAT is the very best strategy." By PDQ

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                      NEW YORK
                      United States
                      Member #90535
                      April 29, 2010
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                      Posted: July 26, 2014, 1:12 pm - IP Logged

                      I forgot to mention this in my response, but I would also point out that even with explicitly-mandated payout/minimum percentages, those are only averages. They can offer 4 games with 30% payout and only 2 games with 80% payout and still be in compliance with the 45% rule. Casinos do the same thing with slot machines. They will have a couple machines with 110% payout and many others with unbelievably awful payouts. Despite this, pretty much any slot is still better than the lottery as far as return goes. They just work faster at extracting your money LOL

                      You should buy $10,000 worth of lottery tickets.

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                        NEW YORK
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                        April 29, 2010
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                        Posted: July 26, 2014, 1:17 pm - IP Logged

                        South Dakota's Video Lottery has a payout minimum of 80% and maximum of 92% while their paper ticket games are set to a minimum of 50%. I wonder if that 80+ percent payout is common for video lottery games in other states. If it weren't for the possibility of large payouts on the lotto games, one might conclude it makes more sense to play video lottery or traditional slot machines.

                        The lottery payouts will never be $1 for $1, because lottery players are the only ones risking their money.