Money Management

Annual spending on lotto tickets has surpassed $100 billion. Here’s why you should skip the games and put your money toward a real investment. 

With inflation still elevated, it’s natural for people to look for an easy way to ease some of the financial pain. And focusing on finding a quick fix for your personal finances is understandable.

After all, home prices have increased nearly 30% since 2020, car prices are up, and last year consumers experienced the largest annual increase in food prices since the 1980s, according to the U.S. Government Accountability Office. Even car insurance prices have skyrocketed recently.

Looking for a little financial relief has led many Americans to spend more on lottery tickets. But spending your hard-earned money on the lotto is almost always a losing battle, despite the promised potential of a huge payout.

Lottery ticket sales are on the rise

Spending on lottery tickets is up 20% from 2020, and ticket sales have topped $100 billion in each of the past two years. And last year, state lottery ticket sales reached an all-time high of nearly $108 billion, according to the North American Association of State and Provincial Lotteries (NASPL).

And if we look back over the past decade, it becomes even more apparent that Americans are comfortable spending an increasing amount on lottery tickets. Ticket sales were just $68.8 billion in 2012, compared with $108 billion last year, a massive 57% increase over 10 years.

Out of the 45 states that have lotteries, Florida sold the most tickets, with $9.3 billion in sales — followed by California, with $8.9 billion in sales last year, according to NASPL.

In addition to rising inflation, another draw to lottery tickets may come from the size of some recent prizes. The largest single-ticket winning prize of $2 billion was awarded from the Powerball lotto just last year.

Those large jackpots do a good job of enticing more people to buy tickets, but the chances of winning are constantly working against you.

How to realistically turn a little money into a lot

Occasionally spending a few dollars on a lottery ticket certainly isn’t going to break the bank. Many people only buy tickets when the jackpot reaches astronomical highs, which almost always doesn’t work out well for them because the chances of winning the largest jackpots are far lower than games with smaller payouts.

The chances of winning the Powerball jackpot is 1 in 292 million. A mathematics professor recently told the Associated Press that if someone bought a Powerball ticket three times a week for 80 years, they’d still be far more likely to get struck by lightning than to win the large payout.

But it’s not just that the odds are stacked against you. It’s also that when you spend that money on lottery tickets, you’re taking it away from investment opportunities that have far better chances of making you money.

Let’s say you spent $20 per month on lottery tickets over 30 years (totaling $7,200). If you opened a brokerage account and put $20 every month toward an index fund that tracked the S&P 500, you might earn a historical average rate of return of 8% per year — giving you $27,400 at the end of the 30 years.

That’s not an eye-watering amount of money compared to lottery jackpots, but it is far more realistic and achievable than hitting it big in the lotto. Sure, a few dollars here and there probably won’t derail your personal finances. Just make sure you’re putting far more effort — and money — into a real investment plan.

Alert: highest cash back card we’ve seen now has 0% intro APR until nearly 2025

If you’re using the wrong credit or debit card, it could be costing you serious money. Our experts love this top pick, which features a 0% intro APR for 15 months, an insane cash back rate of up to 5%, and all somehow for no annual fee.

In fact, this card is so good that our experts even use it personally. Click here to read our full review for free and apply in just 2 minutes.

Read our free review

We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.

 Read More 

Without proper estate planning, it’s almost impossible to protect assets. Find out why everyone should consider a revocable living trust and how it can benefit you. 

Have you ever thought about what would happen to your assets if you were to pass away? Would your family be left with the burden of navigating legal paperwork to distribute your assets? Would your assets go to the wrong people? Estate planning is something that every single person should prioritize. One of the most important ways to plan for the inevitable is by establishing a revocable or living trust.

A revocable living trust is a legal document that allows a person, often called the grantor or settlor, to place assets into a trust during their lifetime for the benefit of themselves or others. Here are the advantages of setting one up.

Avoid probate

One of the most significant benefits of a revocable trust is avoiding probate. Probate is a legal process where the court validates a will and distributes a deceased person’s assets like stocks or bonds. This process can be time-consuming, costly, and public (more on this below).

A revocable trust, on the other hand, allows the transfer of assets to beneficiaries without the need for probate. This means that your assets can be distributed much faster and with fewer expenses.

Protect your privacy

Probate can also be a very public affair. Anyone can access the probate court records, which means your assets, debts, and beneficiaries’ names will be made public. A revocable trust, however, keeps everything private.

The trust document is not filed with the court, so there are no public records for anyone to see. This can help protect your family’s privacy during a difficult time.

Control over your assets

With a revocable trust, you have control over your assets even after you pass. The trust allows you to designate beneficiaries for your assets and property, and you can also specify when and how they will receive them.

This level of control can be particularly important if you have children or other beneficiaries who are not yet ready to receive assets and need to be cared for by a trustee until they are ready.

Provide for incapacity

In addition to asset management, a revocable trust can also provide for incapacity. If you become unable to manage your affairs due to illness or disability, the trustee you designated can step in and manage your assets on your behalf.

This can help make sure that your needs are taken care of and your assets such as investments and savings accounts are properly managed, even if you aren’t able to do so yourself.

Creating a revocable trust can be a simple and effective way to manage your assets both during and after your lifetime. It provides many benefits, including privacy protection and getting to avoid probate. Every single person should at least consider creating a revocable trust as part of their estate planning. With the help of an experienced attorney, you can create a trust that meets your unique needs and provides peace of mind for you and your loved ones.

These savings accounts are FDIC insured and could earn you 11x your bank

Many people are missing out on guaranteed returns as their money languishes in a big bank savings account earning next to no interest. Our picks of the best online savings accounts can earn you 11x the national average savings account rate. Click here to uncover the best-in-class picks that landed a spot on our shortlist of the best savings accounts for 2023.

We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.

 Read More 

Just like everything else, YouTube Premium is about to cost more. Read on to learn why one writer won’t be canceling her subscription. 

Everyone has a favorite streaming service — and it’s no wonder, since we have so many options these days. For me, YouTube Premium takes the cake. I’ve been a subscriber for a few years now, and when I recently got the news that it’s going up in price, I didn’t consider canceling, even for a second.

Let’s take a look at the new cost of YouTube Premium and the features that make it worth keeping as a regular charge on my credit card.

How much will YouTube Premium cost you now?

As recently reported by The Verge (and also via email, if you’re a current subscriber), YouTube Premium’s price is going up by $2 a month, and will now be $13.99 per month. If you pay for a full year at once, the cost is increasing from $119.99 to $139.99, a $20 jump.

RELATED: Personal Finance Guides and Advice

YouTube Music, which is available on its own or as part of Premium (more on that below!) is increasing in price, too, and will now cost $1 more per month. It used to be $9.99 per month, but now it will be $10.99. What features do you get for this new higher price?

What does it include?

The biggest selling point of YouTube Premium is you get an ad-free viewing experience. This is not to say that you won’t have to deal with sponsored content and internal ad breaks from your favorite content creators, all of whom have bills to pay. But if you subscribe to YouTube Premium, gone are the days where you must suffer through ads or count down the seconds until the “Skip Ad” button appears on screen.

YouTube Premium also includes YouTube Music Premium, which is ad free as well. You can download music and videos for offline viewing/listening, which can really come in handy if you’re staring down a long wifi-free flight. You’ll also get access to YouTube Kids, featuring special programming and shows for the younger set.

The YouTube apps gain some additional functionality when you go Premium, too. With free YouTube, you can’t multitask with the app running; if you go to your email app, for example, the video you’re watching will stop playing. This isn’t the case with Premium, though, and it’s one of the reasons why I’m not batting an eye at a price jump.

YouTube Premium is still aces for me

This ability to keep listening to a video while you’re in another app is the biggest perk of YouTube Premium for me. You can turn any video into an instant podcast, and if you’re as much of a multitasker as I am, you’ll love being able to keep listening to a video while you do chores, look up directions, or check social media.

YouTube Music Premium, which is included with YouTube Premium, is also a vital service for my everyday life. The service reached 100 million tracks last fall, and you can create custom playlists or take advantage of the thousands curated by YouTube or by your fellow listeners. I listen to music during my work day, and I’ve discovered many new-to-me artists as a result. The YouTube and YouTube Music apps for iPhone and iPad also make entertaining yourself on the go super easy.

Life just keeps on getting more expensive, and YouTube’s price increases are really no surprise. That said, the service offers enough value for me to absorb the hit. If you’ve never tried YouTube Premium and already use regular YouTube (perhaps to check out personal finance advice?), you can get a free month of Premium to see if it’s right for you.

Alert: highest cash back card we’ve seen now has 0% intro APR until nearly 2025

If you’re using the wrong credit or debit card, it could be costing you serious money. Our experts love this top pick, which features a 0% intro APR for 15 months, an insane cash back rate of up to 5%, and all somehow for no annual fee.

In fact, this card is so good that our experts even use it personally. Click here to read our full review for free and apply in just 2 minutes.

Read our free review

We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.Discover Financial Services is an advertising partner of The Ascent, a Motley Fool company. The Motley Fool recommends Discover Financial Services. The Motley Fool has a disclosure policy.

 Read More