Is Lottery Fever Actually Good for You?

The MegaMillions jackpot is currently $344 million. The current Powerball jackpot is not chump change, either — it’s at $122 million.
When lottery jackpots get this high, you’ll hear many financial experts explaining how buying a lottery ticket is the worst financial move you can make. They prefer you invest that ticket purchase in a savings account or mutual fund.
Never mind them. It’s possible playing the lottery can be a perfectly sound investment, if lottery tickets are part of your entertainment budget. In fact, here are a few times it’s perfectly reasonable to invest in a lottery ticket (and one time it’s not).

You have the money in your entertainment budget.
The lottery is a fantasy. The chances of winning are so minute that you just have to recognize the lottery for what it is – a few moments of entertainment. We all have our own version of the ‘lottery dream’, where you pay off all of your debt, your mortgage, turn your kids into trust fund babies, buy your friends and family large gifts, travel, and so on. All of that after making sound investments with the majority of your windfall, of course. A momentary diversion is the net benefit of that ticket, though, so don’t think it’s actually anything more. If you don’t have money in your entertainment budget this week, don’t buy lottery tickets.     Lottery-Ticket

The jackpot is really high.
But this week, the jackpot is really high – currently the MegaMillions jackpot is $344 million. Who wouldn’t want a chance to win that, no matter how small that chance might be? If you’ve already spent your entertainment budget, make corrections somewhere else before you start picking your numbers. For example: If you can complete your full weeks grocery shopping for 20 percent less, using a good list, store sales, your own pantry and coupons, then buy yourself a few tickets. Put the rest into your emergency savings or some other worthy budget item.

You are hoping a lottery win will help you fix a financial problem.
Wait. This is the time it’s absolutely NOT OK to buy a lottery ticket. If you have crushing debt or are being hounded by collectors, or your income has been drastically reduced and you just are not sure how you will keep it together – the lottery is not the answer. While the lottery dream can be a tempting escape from your financial reality, actually taking steps toward effectively managing your budget, getting your debt under control or increasing your savings will lead to real financial peace of mind.

Money is a tool for you to use – feel free to use it to purchase a ticket to daydream for a little bit.  Just make sure you’ve taken concrete action steps to secure your short and long-term financial future first.

If you’d like help working out a budget or managing debt, contact a certified credit counselor from Take Charge America now.

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