Original post author: Ryan
A month ago, a few friends and I scratched our way through a stack of scratch cards while enjoying beers at a local Waltham dive bar. We kept cashing in our winnings (our very small winnings) and putting the money back into more scratch cards. As you could have guessed, this strategy was not effective for us.
This got me wondering...what does someone get for the price of a scratch ticket? I concluded that you get a slim chance to win some money, a brief rush while your mind imagines a huge windfall, a few short minutes of entertainment, and then, ultimately, the dull satisfaction of donating a small sum of money to the state.
If you’re able to enjoy the entertainment value of a scratch card – and if you’re able to avoid falling into the lottery "deep end" – then maybe a buying a few scratch cards is justifiable. But what if we put the entertainment aside and focus only on the chance of winning money. Can we somehow maximize our chances of winning? What are the odds, really? There are a lot of mysteries when it comes to scratch cards – and I get the sense that few people stress the details when it comes to scratch cards.
Did you know that the winning statistics for all scratch cards in Massachusetts (and most other states) are available on the state lottery website? Sometimes they are even on the back of the card. I built a tool that reads those statistics and aggregates them. I analyzed those posted statistics for 22 different types of scratch cards ranging in purchase price from $1 to $30, hoping to somehow find scratch card enlightenment.
So how bad are your odds to win any money when you play a scratch card?
Pretty bad. Your chances of actually making more money than what you paid are 1 in 4 at best (if you buy a $30 scratch card), and 1 in 9 at worst (for a $1 card).
Let's say you're not looking to win a million dollars. What are your chances of winning just $100?
Super bad. For $1 cards, about 1 in 950 have a prize of $100 or more. For $10 cards, those odds improve to 1 in 60.
Are your chances of winning higher if you buy a more expensive scratch card?
The short answer to this question is: yes. But keep in mind that the odds are heavily against you even with the more expensive cards, so buying more expensive cards is really just putting you on a faster lane to losing money.
Are some scratch cards within a price tier better than others?
Not really. From my analysis, I saw that the statistics for typical $1 cards are all fairly consistent, and the same goes for the other price tiers. The exception to this are the "limited issue" cards, which I talk about below...
Do the “limited issue” scratch cards have a better chance of winning?
The short answer is no. But, it's noteworthy that some of the "limited issue" cards do weird things with the statistics. For example, there’s a limited edition $10 scratch card this year called “$50, $100 and $500 Blowout” which only offers prizes between $50 and $500. This is fairly unusual because most scratch cards have a few million-dollar prizes and many small winners too. While the prizes for this card are different, the chances of winning aren’t really better.
Ok, let’s say you want to dream big. What’s your chance of winning over $1 million?
Well, the $1 and $2 scratch cards don’t even offer a $1 million prize - so if you're buying those your chances are literally zero. Higher value cards do technically offer a $1 million prize, so your chances of actually winning $1 million improve from literally zero to effectively zero. The chance of winning $1 million or more on a $5 card is 1 in 4.2 million. Those odds improve to about 1 in 650,000 for the $20 cards. While these odds are super-duper low, winners do exist. It happens...just not that often.
How much money is Massachusetts making off of these scratch cards anyways?
I can’t really approximate how much money the state spends on designing the cards, manufacturing, distributing, managing the prizes, paying retailers, etc. But I can see from the statistics that their profit margin (accounting only for prize payouts) is about 30% for the $1 scratch cards and 15% for the $20 and $30 cards.
At first, those margins seemed low to me. If the odds of actually winning some money is between 1 in 4 and 1 in 9, then should their profit margin be higher – like 80%? Well, the truth is that there are technically a few big jackpot winners. Those lucky few jackpot winners take a hefty bite out of the state’s profit.
All that being said…how can you maximize your chances of winning?
No matter what you do, your odds of winning are garbage. But there technically are some things you can do to prevent your odds from worsening into hot garbage.
First of all, you need to understand that there is a predetermined number of jackpots per type of scratch card, so you shouldn’t waste your money on scratch cards that have already declared jackpot winners. You can see the past winners here. Conversely, if a type of scratch card is getting very old (like many many months old) and no jackpot winner(s) have been announced, then that could mean that a winning card is still lurking somewhere in the dwindling spindles of cards at convenience stores. In that case, there would theoretically be a higher probability of hitting it big with that type of scratch card. Two caveats of this line of thinking are (a) someone might have won and not yet claimed the prize and (b) even under those very idealized conditions your odds of winning big are still quite bad.
If you’re going to spend $10 on scratch cards, you’re statistically better off just getting one $10 ticket than buying ten $1 cards. That being said, you might have slightly more fun playing 10 games than 1 game – so it’s up to you.
But here is the real hint: One way to win every time is to shift the definition of “winning”. As you scratch, enjoy dreaming of those big prizes, and enjoy your beer when you don’t win those prizes. Revel in the fun of scratching off those tickets. Stick to a budget, and don’t lose too much money.
[Dumster fire image by user jleonardart on teepublic.com - you can buy a T-shirt with that image on it here]
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