last updated 2 May 2002
Lotteries, Sports Betting and Horse Racing
Breakage (payouts rounded down) 2%
State Taxes (most states) 17%
Return to Gambling
Betting $11 to win $10 on your favorite football team is one of the best
bang-for-your-buck gambles you can find.
See Bad Bets at casinoplayer.com.
and The Wizard of Odds.
Example: NJ Lottery (609) 599-5800 Pick-6:
Select 6 numbers from a list of 49. (It was changed from 46 to 49 several years ago.)
6 Numbers drawn at random.
Prize pool will be equal to 50% of the gross dollars wagered.
(39% goes to education the rest for administrative costs.)
Result Odds % of pool Av. Amt.
6 out of 6 1:14 Mil 68% Jackpot
5 out of 6 1:54,201 10% $2,700
4 out of 6 1:1,032 11% $56
3 out of 6 1:57 11% $3.00
Jackpot value is estimated based on expected sales and contracted annuity
interest rate. There will be a total "roll forward" of each prize pool
tier if there are no winners. Jackpot is payed out in 30 yr. annuity.
A cash payout is what the cost of the 30 yr. annuity would be; about 50%.
So Jackpot would have to be $28M for a $14M cash payout for even odds
(assuming you didn't have to share with another winner).
Federal Income tax 27%
In New Jersey it requires 5 out of 50 plus 1 out of 36 to win the jackpot.
Odds are 1:76 M