The current mega-millions jackpot is $640M, which gives you a lump-sum payment of $462M. Applying a federal tax rate of 25%, state tax of 0-10% and giving a little to your wife to spend, you’ll be left with about $300M (rounded).
The number of possible combinations is 176 million. Assume 300 million tickets are sold (just doubling the increase in jackpot since last drawing and rounding off). Should you buy a ticket or not? How about 2 or more?
I bought ten bones. AF trip if I hit - we’ll circle the globe collecting an eclectic mix of BO-FO and IT bosses. It will be glorious, ending in India for a lecture by keynote speaker ChickenTikka on the merits of marriage. Then we’ll head to Goa and party hard.
I bought ten tickets, so I figure my odds are probably around 1 in 8. Bring on the HCB’s!
i heard Goa gives you a diarrhea after a little swim in the ocean, but otherwise the party there is sick… wait, no pun intended. i also bought 10ish, you never know…
Lump sum of $462M, assume half gets taxed and you’re left with $231M. There are 171M possible numbers. I smell an arb opportunity. Let’s pool our money together and buy all the numbers. I’ve got $5 on it.
You’re assuming ther’se no pot split. You have 1 split and you’re F’ed
Thanks for shattering my dream. We only needed another $169,999,975.
Excellent, I’ll work on my keynote and keep the Russian hookers and blow on standby.
Not everyone is expected to survive, but for those that do there will be great reward.
This lottery system is great for the government. Not only do ticket sales exceed the winning payout, but the winner gets taxed on top of that. Let’s say ticket revenue for a $640 million payout is $800 million. From the OP, the final payout after tax is $300 million. So, the organizers made $500 million. We should just slash taxes and organize a $1 billion jackpot every month. People are just lining up to give their money away.
Went in on a pot here at work; I know the odds are horrendous (I probably have a better chance of finding that money left on the street), but the thought of half my office winning and me being left out (I’d probably hang myself) was more than enough for me to jump in.
Sad but true. And the odds of a pot split are pretty good; I was reading something that said (for this particular uber-jackpot) that the expected number of winners is approaching 1.9.
Was just talking about this at lunch with colleagues. Really, in this scenario, all you’re buying is “regret insurance”, which I guess makes sense?
As for myself, bought no tickets. Attempting to maintain my lifelong record of having never bought a lotto ticket or played any casino game where the house has an edge (though I still loves me some poker). And no judgement against the AF folks who do buy a ticket, btw - I’m aware that people in this forum are very conscious of their odds. To many people, the value of a ticket is not just the expected payoff.
the CFA curriculum actually has a behaviorial bias for buying lottery tickets. I think it was framing bias?
But I usually go in on the office pots, usually 5-10 bucks, because can you imagine if they won, and you were the only loser left in the office after they all quit? lol
this actually happened to one guy, there was a news article about how some guy didn’t get his $2 in cause he went on a trip and the group actually won like $70M or so, and everyone became millionaires except the guy.
This jackpot is big enough that going in with a group still works out nicely. When it’s like $200M, then a lump sum of around $130M, then taxes leave you with $65M and you have to split it 20 ways…$3.25M isn’t even worth playing.
I was on (in?) line at a newstand and a lady was filling out the bubbles to pick her own numbers for her Mega Millions ticket. The guy running the stand says “most people just do quickpick” and she says “well the guy on the news said you should pick your own numbers!”
I walked away shaking my head.
it will be nice if it stays until next Tuesday’s drawing although it is unlikely given how many tickets have been purchased. i’d like to see it balloon to $1 billion, that would be a fine round sum
If I win I’ll take the AF crew to the Masters and will bring the full Ben-Gals cheerleaders’ squad with us. If they think some teenager can be good on the sack then we’ll teach those chicks a lesson on what a championship pounding over a long weekend means. Who Dey!
Speaking of lotto. Do these firms do well in terms of ROI? Are we talking say 40% returns per annum. Do tell folks. Cheers
3 tickets won. Good thing we didn’t do that buy all the tickets idea