Lottery is a fixture in American society — and probably the biggest form of gambling in America. It raises money for states and many people spend a large proportion of their incomes on tickets. But it’s not without costs. A new study by the National Bureau of Economic Research tries to quantify those costs.
The results show that most lottery players don’t realize just how much they are losing by buying a ticket. And they also don’t get a realistic view of the actual payout rates. The vast majority of respondents to the NORC survey believed that lotteries paid out less than 25% of their total sales as prizes.
That misperception reflects the way that state lotteries promote their products. They rely on two messages primarily. One is that the proceeds from the lottery benefit the state and, therefore, you should feel good about yourself for putting your money towards that cause. And the other is that you should play because it’s fun. Both of those messages obscure how regressive the activity is and how much of people’s incomes go to tickets.
The truth is that most people do not understand money and how to make it work for them. When you have a lot of it, it can change your life for the better or worse. When you don’t have it, you can find yourself in a very difficult situation. That’s why it is important to learn how to manage your money properly.
