As you might expect, (but would probably rather not spend too much time thinking about) your chances of winning the lottery are significantly smaller than your chances of dying, at least eventually. At the time of writing, those odds are about as certain as they get. Not pretty, but it’s true.
Yet people do win the lottery, and people do get into fatal accidents too. But how do the odds actually stack up?
For the sake of reference, let’s take a look at some lottery odds. In some instances, your odds of winning any prize are actually pretty good – for instance, the chances you come away from the French lotto with at least something for your efforts are 1 in 6.
Now let’s look at the comparative chances that you pass away before reaching retirement age. Though the odds differ wildly in South Africa, the average male has around a 4 in 10 chance of not making it to retirement age. The odds are lower (or better, depending on which way you look at it) for South African women, at roughly 2.5 in 10.
Now compare those odds with the chances of winning big in the same lotto. The odds of winning the jackpot prize in the French Lotto draw are roughly 1 in 20 million. (1 in 19,068,840 to be precise.)
And even those odds look good compared with your chances of winning the South African Powerball at 1 in 42,375,200. Never mind the almighty US Powerball, where the chances of winning the jackpot are an eye-watering 1 in 292,201,338.
Always remember there’s a very good reason those jackpots get so big in the first place.
If you look at the potential return on investment of the cost of a single winning lottery ticket, it’s not hard to see the appeal they hold for us. If a R30 ticket can turn into a
R27,148,560,000 pay out, why not risk it?
And indeed, there’s no reason you shouldn’t risk it – unless it means you're not investing in a life insurance policy as a result. Most regular lottery players vastly underestimate the amount of money they spend on tickets over the course of a month or year. The average US citizen spends over R17,000 a year on lottery tickets.
And unfortunately, it’s often the lowest-earning workers who spend the biggest portion of their wages on tickets. Those earning less than R50,000 annually frequently spend up to 13% of their income on lotto tickets.
Compared with the difference even the most basic life insurance policy would make to their families when they die, the real danger of betting on the lotto instead of investing in life insurance becomes all too clear.
This is especially true if you don’t make a good wage or are already in financial difficulty. If your family is struggling to make ends meet right now, do you really want to leave them with debts and funeral expenses to pay while they're grieving your loss?
In contrast, a basic life insurance policy can help them pay off the mortgage and clear their debts, keep your children or grandchildren in school, and even take some time away from work while they mourn your passing.
If you're pinning your hopes on the lottery to help you achieve this goal, you're wasting money that could actually guarantee them a better future than they have now, at odds of 1 to 1. As long as you keep paying your monthly life insurance premiums, your family will receive a surefire tax-free payout when the time comes.
It can help them escape the circle of poor earning potential that keeps people buying lotto tickets in the first place. So - what will your legacy be?