18 Jan 2013, 12:52pm
personal finance rant:
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  • The cost of playing the Lottery has gone up – it’s still a guaranteed shafting so why the fuss?

    a modern-day Mark of the Beast

    a modern-day Mark of the Beast

    Funny the things people get worked up about. The nation’s favourite purveyor of empty dreams, the National Lottery, is apparently raising the cost of entry from £1 to £2, and some people are getting really worked up about it.

    MPs and campaigners said the increase was a ‘tax on the poor’ and ‘sheer greed’ and research revealed pensioners and those on low incomes would be hit hardest.

    er, what’s the problem guys? The greed issue is a moot point, what about the ‘sheer greed’ of the punters? You’re buying an empty dream here, so if the price has gone up, buy less of it. It’s still an empty dream, because half of sod all is still sod all. It’s so unlikely that you’re going to win that there is an easy solution. Halve the number of times you buy a ticket :) You’re still vanishingly likely to win, indeed most buyers have more chance of pegging it in the next hour than winning the jackpot! You’re effectively buying a call option on your life, yikes!

    You could make a far better choice in where to buy your empty dreams from. Apparently lottery players spend an average of about £6 a week. Take the £300 a year, by a FTSE all-share index tracker and get on with the rest of your life like Drew from Objective Wealth has.

    You’ll get a far greater proportion of your money back in winnings, possibly even make a profit on the deal. Why? Because though there is an element of chance due to risk, you are also buying a teeny share in a productive economy. You are actually buying an asset, not the empty promise of a sliver of a chance of massive riches. Some of those companies will use your ex-Lottery money to make a profit, and they are legally bound to share some of the spoils of war with you. Which is a damn sight more than Camelot. When people are asked by their financial advisers how they feel about risk, most employees say they hate it, avoid if possible. So why the hell are they taking a bigger risk of losing all their Lottery money than of surviving the next hour? Barmy.

    Half the paid out prize money (this is not half the money takein in, remember!) goes to the Jackpot, which is what everybody thinks of when they buy the ticket. A few people get the dream, though in an evil twist of fate it then often really buggers up their lives , at the expense of millions of other people’s empty dreams.

    If you really want out of the rat-race you can buy your way out of it, just not that way. Here, here, here and here is how. It’s all about agency, taking responsibility for your life and making a start. Nowadays is the best time to prepare for buying your way out of the rat-race, because for all the moaning and griping about how hard things are now, recession, blah blah, the real fact is you are living in a rich country where many essentials of life are so much cheaper relative to earnings that it’s easier now. The reason so many of us are in debt is because we have followed the exhortations of advertisers to spend God knows how much of the increased disposable income on Wants and trifles. So stop buying consumer crap and sort out your life, rather than buying empty dreams and becoming a complainypants. Sorting your life out starts with cutting out the Lottery tickets.

    What exactly are you buying with a Lottery  ticket?

    You are buying an empty dream, a chance to daydream a little bit of your life away and pretend you aren’t a drone in an office having to put up with tosspots telling you what to do. At the same time a little part of you is telling yourself that you are a LOSER because there isn’t any other way of getting what you want, and the best chance you have is a 14-million to one chance.

    STOP doing that to yourself. It’s rude – you are the sum total of fantastic capabilities and you need to stick an axe through that negative self-view right now. It almost doesn’t matter what sort of a hole you are in life right now, if you are spending any mental clock-cycles on the infinitesimal chance a National Lottery rope is going to come down to pull you out then you are not using your capabilities to look around you, see what you have to hand and get with building yourself a ladder out of the hole, cutting steps in the sides or just sitting back and reading a book. You’re betting on a lower probability than your own death in the next 60 minutes.

    My detestation of the National Lottery isn’t particularly because it’s a rip-off, although it is. It is because it robs punters of agency by giving a lightning conductor for the abandonment of hope – either by looking for the good in their position or effecting change. I know someone who, when he was down to his last six pence 1 without a job in the 1950s 2 took more positive action than buying a lottery ticket. He took that six pence and threw it off London Bridge into the Thames, because then he knew he was starting from zero.

    Now he had nothing, and this strengthened his resolve, and he went and found a job 3. That is agency, knowing when something is holding your back. Had he spend his last sixpence on the Lottery, or the horses, the symbolism would have been very different. He would have been telling himself that he couldn’t make it without an infinitesimally likely stroke of luck.

    Good Causes you say?

    About a quarter of the money taken goes to good causes/reduces the tax burden on the rest of us. Want to keep up your work for good causes? Take a quarter of your £300 and give it directly to charities of your choice, ideally by Gift Aid so they get 20% on top from the taxman. You can’t Gift Aid a lottery ticket ;) That way your preferred charities get more money from what you’d have spent on lottery tickets!

    It won’t be you

    It really won’t. You have a 14 million to one chance of getting the winning numbers, and have to share that with any other winners. Imagine you started at 18 and bought a ticket every single day until you drew your pension at 65. You would have purchased over 17,000 tickets, and you would have improved your chances of winning to about 1 chance in 800. That’s still pretty piss poor, and most people seem to run weekly, so your lifetime chances of a jackpot win as one in over 5000. Do something better with your life, for heaven’s sake. Purchase one ticket, once, which moves the dial from zero to a chance of one in 14 million. That way you get the buzz of the empty dream, but it costs you only £2. Then let it go. That first ticket is the one that makes most of the difference to your chances.

    It could be you, but it’s very unlikely 4 to be you.

    So why do it?

    Notes:

    1. that’s about 50p in today’s money
    2. I was a child when I heard the story. Even if it’s apocryphal, the symbolism is powerful IMO
    3. Casual work was much easier to come by in the 1950s than now, so this isn’t as mad as it sounds
    4. nearly 14 million to one against – just fuhgeddaboutit