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Lottery money: How much gets returned?

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LotteryPlayer

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 - binary
hypersoniq

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.

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Chewie

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.

johnph77's avatar - avatar
johnph77

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

Avatar
CASH Only

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.

Avatar
Chewie

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.

 

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