Yesterday’s post needed a picture of a Maryland lottery ticket for illustration. I couldn’t find a good one online, so I dropped a dollar and picked one up. So why did I pick a Mega Millions ticket, rather than Powerball? Powerball sounds cooler. What gives?
Someone’s gonna win, and it might as well be me. If I must purchase a ticket, I want to maximize my potential earnings. Here’s a spreadsheet showing the expected returns from the two major jackpot games in Maryland. There are three substantial concerns I’ve left out:
- Accepting the lump sum versus the annuity,
- The income reduction due to taxes, and
- The effects of parimutuel splitting.
Business Insider has covered this thoroughly in the case of Powerball. However, these concerns affect the returns to each proportionally, so these can be assumed away. Due to the structure and payout of each game, the different ticket prices, and the different jackpot amounts (Mega Millions is $47 million whereas Powerball is $40 million), the Mega Millions ticket was a better ticket to buy. But not just because it is cheaper.
If I am already buying the ticket.
Image by Lisa Brewster.