Good afternoon,
As the combined jackpot for Powerball and Mega Millions heads well past the $2 billion mark, a website known as Moneywise stated the obvious – you are better off in the stock market.
While often compared to a casino, the stock market provides a much better chance of getting your money back and more, the Moneywise report noted.
The website even went so far as to compare the amount of money spent on lottery tickets in Delaware to investing in the stock market.
Based on recent stock market performance, the $400 million spent in Delaware on the lottery in 2016, if invested in the market, would have increased to more than $540 million in 2017.
The return is based on buying an “Index Fund” that is based on the overall performance of Standard & Poor’s or other indices.
Granted, Moneywise picked a very good year when it crunched the numbers. The S&P index is up only 3 percent this year.
The stock market can go down, sometimes in a big way. It’s not doing so well today.
But making regular investments every year – perhaps throwing a few dollars a week from your lottery money or Wawa coffee into a 401 (k) – minimizes the risk and can pay off nicely when the market goes up.
Then again, many of us who only buy lottery tickets when the huge jackpots show up would miss the joy of picking random numbers and speculating on how the winnings would be spent. We had fun coming up with numbers over breakfast.
With winnings at astronomical levels (the combined Powerball and Mega Millions jackpot could end up rivaling the Delaware state budget) it is hard to imagine how the money could be spent without ruining generations of descendants.
The typical response of going on a luxury vacation could be replaced by buying up the resort or an entire town.
We bombed out on the first Powerball drawing, but one in three hundred million odds are no deterrent. The gods of Wall Street can wait. – Doug and Sharon Rainey
