The biggest mistake lottery winners make
video description
Date: 2026-03-07
Related videos
Comments and reviews: 20
seiban8455
TEDEd continuing its descent into being the mouthpiece of all the worst aspects of our society, let me just go and answer the title: The worst mistake any lottery player makes is playing the lottery.
With winners, it's easy to say 'That wasn't a mistake, look at how it rewarded them! ' but a bad idea is still a bad idea. It is not worth it statistically to play the lottery. Just like it's not statistically worth the risk of robbing a bank. The Lottery is and has always been an alternative form of revenue for the government. Whether they actually get that or not is up to whether or not your country privatized it somewhere along the way.
When the US government starts putting tariffs on things to generate revenue for its government, the entire world looks at that and sees Oh, that's a scam, on their own people no less, what bastards. (If you're a subject of some other country than the US, shut up about Tariffs, you aren't the one being robbed) The British government, way back before the flag looked as it does now, starts letting people buy tickets at non negligible price for a chance at getting rich that statistically will not materialize for the people who need it to, and nobody cares! It's still just robbing your own people for extra taxes on top all the rest.
reply
TEDEd continuing its descent into being the mouthpiece of all the worst aspects of our society, let me just go and answer the title: The worst mistake any lottery player makes is playing the lottery.
With winners, it's easy to say 'That wasn't a mistake, look at how it rewarded them! ' but a bad idea is still a bad idea. It is not worth it statistically to play the lottery. Just like it's not statistically worth the risk of robbing a bank. The Lottery is and has always been an alternative form of revenue for the government. Whether they actually get that or not is up to whether or not your country privatized it somewhere along the way.
When the US government starts putting tariffs on things to generate revenue for its government, the entire world looks at that and sees Oh, that's a scam, on their own people no less, what bastards. (If you're a subject of some other country than the US, shut up about Tariffs, you aren't the one being robbed) The British government, way back before the flag looked as it does now, starts letting people buy tickets at non negligible price for a chance at getting rich that statistically will not materialize for the people who need it to, and nobody cares! It's still just robbing your own people for extra taxes on top all the rest.
reply
ted_ed
just 1000 punds
Bro, 1000 pounds in 1790 are equivalent to about 130, 000 pounds today lol. There's obviously still been immense growth in value on that account, but you made it sound as if he deposited a really modest sum to begin with (also the details of Franklin's bequeathment are actually a lot more intricate.
Inflation is real and it's honestly bizarre that this video didn't touch on it at all. Especially because it is another reason why choosing annual payments isn't that great of an option: By the time you get to those later years, the payout sums might not be nearly as impressive anymore as they seemed when you signed the contract decades earlier.
reply
just 1000 punds
Bro, 1000 pounds in 1790 are equivalent to about 130, 000 pounds today lol. There's obviously still been immense growth in value on that account, but you made it sound as if he deposited a really modest sum to begin with (also the details of Franklin's bequeathment are actually a lot more intricate.
Inflation is real and it's honestly bizarre that this video didn't touch on it at all. Especially because it is another reason why choosing annual payments isn't that great of an option: By the time you get to those later years, the payout sums might not be nearly as impressive anymore as they seemed when you signed the contract decades earlier.
reply
ted_ed
One other mistake that surely most lottery winners must make is that even after having won a very large sum of money or the jackpot they will still continue to buy lottery tickets week after week after week and never again win another cent. Why can't they just be satisfied with their winnings and retire from having to win large sums of money again Some people win more money in a lottery than most of us could make in our entire lives of trying to save. How much money from their winnings are they unnecessarily throwing down the drain simply because they become too greedy to be satisfied with what they've already got and think that they can win more
reply
One other mistake that surely most lottery winners must make is that even after having won a very large sum of money or the jackpot they will still continue to buy lottery tickets week after week after week and never again win another cent. Why can't they just be satisfied with their winnings and retire from having to win large sums of money again Some people win more money in a lottery than most of us could make in our entire lives of trying to save. How much money from their winnings are they unnecessarily throwing down the drain simply because they become too greedy to be satisfied with what they've already got and think that they can win more
reply
funny3272
Annuity (taking a portion of winnings per year) and Compound Interest (taking lump sum) 30 years. Benjamin Franklin Interest 200 years. who is going to live 30 years to earn the higher rate (average winner is 40 years old and average death 65 years old.
Keep a portion for Compound Interest to live off annually and enjoy moderately the rest of money won.
Also remember when Publisher's Clearning House folded and the winners who won for life (like getting a portion per year) stopped receiving money. In otherwords, get the full amount now in the event something happens from whomever is paying you the winnings.
Fix it.
reply
Annuity (taking a portion of winnings per year) and Compound Interest (taking lump sum) 30 years. Benjamin Franklin Interest 200 years. who is going to live 30 years to earn the higher rate (average winner is 40 years old and average death 65 years old.
Keep a portion for Compound Interest to live off annually and enjoy moderately the rest of money won.
Also remember when Publisher's Clearning House folded and the winners who won for life (like getting a portion per year) stopped receiving money. In otherwords, get the full amount now in the event something happens from whomever is paying you the winnings.
Fix it.
reply
mayonnaiseeee
I wish people in general would realize 2-3 million is absolutely nothing, especially in the US. That'll barely get a couple of people living through one lifetime comfortably, accounting for emergencies, surprise expenses, and luxuries. In the US, a ridiculous number of people are one emergency (a healthcare disaster, a car disaster, a home maintenance disaster) away from financial ruin, so of course any sum of money in the thousands and beyond seems like a lot. but it's just not. And the more expensive things we buy, the more insane the maintenance and upkeep costs.
reply
I wish people in general would realize 2-3 million is absolutely nothing, especially in the US. That'll barely get a couple of people living through one lifetime comfortably, accounting for emergencies, surprise expenses, and luxuries. In the US, a ridiculous number of people are one emergency (a healthcare disaster, a car disaster, a home maintenance disaster) away from financial ruin, so of course any sum of money in the thousands and beyond seems like a lot. but it's just not. And the more expensive things we buy, the more insane the maintenance and upkeep costs.
reply
IndustrialCake
I’d like to think I wouldn’t blow it all on extravagant things because I’m at the age now where I know more stuff=more work and headaches. I can’t imagine blowing it on a yacht for instance. I have zero interest in learning how to maintain a yacht. Same with massive houses. It just sounds like a ton of headaches and work. You might think you can just pay people to take care of all this stuff for you, but people can be untrustworthy and unreliable. All I’d really want is a big property somewhere quiet with a cute home, and lots and lots of security.
reply
I’d like to think I wouldn’t blow it all on extravagant things because I’m at the age now where I know more stuff=more work and headaches. I can’t imagine blowing it on a yacht for instance. I have zero interest in learning how to maintain a yacht. Same with massive houses. It just sounds like a ton of headaches and work. You might think you can just pay people to take care of all this stuff for you, but people can be untrustworthy and unreliable. All I’d really want is a big property somewhere quiet with a cute home, and lots and lots of security.
reply
PainDeVie648
The sad truth is, the majority of the public is better off taking the annuity-type payout. Most people do not have the financial savvy or discipline. Or they wouldn’t be buying lottery tickets in the first place!
If you are financially savvy, then the immediate payout is almost always better because of the time-value of money (ie inflation ravaging your money. This is what wealthy people do. They build up assets that generate income, and use debt to facilitate this and to lower taxes.
reply
The sad truth is, the majority of the public is better off taking the annuity-type payout. Most people do not have the financial savvy or discipline. Or they wouldn’t be buying lottery tickets in the first place!
If you are financially savvy, then the immediate payout is almost always better because of the time-value of money (ie inflation ravaging your money. This is what wealthy people do. They build up assets that generate income, and use debt to facilitate this and to lower taxes.
reply
mattburland8105
Question about the annuity option, can you pass that annuity on if you were to die before the end of the term Taking the annuity looks a little different if you are 20 years old versus if you are 80 years old.
Then again, if you planned to take the lump sum and invest it, I guess that also depends on how much time you have left, but that definitely could be left to your heirs. Although, probably taxed again
reply
Question about the annuity option, can you pass that annuity on if you were to die before the end of the term Taking the annuity looks a little different if you are 20 years old versus if you are 80 years old.
Then again, if you planned to take the lump sum and invest it, I guess that also depends on how much time you have left, but that definitely could be left to your heirs. Although, probably taxed again
reply
tconnolly9820
The most interesting things I have learned from this video as an irish man about American lotteries is 1: you have to pay tax! Here it's totally tax free.
2: you only get less than 30% of the total winning amount if you take it all in one lump sum! Here, if you win 3 million you get 3 million straight into your account.
I assumed that was how it worked everywhere. You guys are getting screwed.
reply
The most interesting things I have learned from this video as an irish man about American lotteries is 1: you have to pay tax! Here it's totally tax free.
2: you only get less than 30% of the total winning amount if you take it all in one lump sum! Here, if you win 3 million you get 3 million straight into your account.
I assumed that was how it worked everywhere. You guys are getting screwed.
reply
marcse7en
How can lottery winners make a mistake, when winning the lottery is utterly, utterly, utterly, utterly, utterly, utterly impossible. And yet, people allegedly win all the time
It's like having somebody GUESS your phone number, and they get it right; it's just not gonna happen.
I've held Premium Bonds and played the lottery for a combined 94 years, and I'm STILL dirt poor!
reply
How can lottery winners make a mistake, when winning the lottery is utterly, utterly, utterly, utterly, utterly, utterly impossible. And yet, people allegedly win all the time
It's like having somebody GUESS your phone number, and they get it right; it's just not gonna happen.
I've held Premium Bonds and played the lottery for a combined 94 years, and I'm STILL dirt poor!
reply
TEDEd
If you’re a high school student, you can start building your financial future now! We’ve partnered with Gifted Savings, a non-profit that gifts $1, 000 investment portfolios and free financial education to young people, helping them learn how to grow their wealth over time. Learn how you can bring Gifted Savings to your school or community at ed. ted. com/giftedsavings
reply
If you’re a high school student, you can start building your financial future now! We’ve partnered with Gifted Savings, a non-profit that gifts $1, 000 investment portfolios and free financial education to young people, helping them learn how to grow their wealth over time. Learn how you can bring Gifted Savings to your school or community at ed. ted. com/giftedsavings
reply
TEDEd
If you’re a high school student, you can start building your financial future now! We’ve partnered with Gifted Savings, a non-profit that gifts $1, 000 investment portfolios and free financial education to young people, helping them learn how to grow their wealth over time. Learn how you can bring Gifted Savings to your school or community at ed. ted. com/giftedsavings
reply
If you’re a high school student, you can start building your financial future now! We’ve partnered with Gifted Savings, a non-profit that gifts $1, 000 investment portfolios and free financial education to young people, helping them learn how to grow their wealth over time. Learn how you can bring Gifted Savings to your school or community at ed. ted. com/giftedsavings
reply
camgere
If you want the big lottery win to set you up for life, the annuity choice makes sense. You will be in a lower tax bracket. The $100, 000 tax bracket is lower than the $3, 000, 000 tax bracket (or even half that. If you only spend the money after you get it, it will reduce the temptation to go through half your money in the first year after taking the lump sum.
reply
If you want the big lottery win to set you up for life, the annuity choice makes sense. You will be in a lower tax bracket. The $100, 000 tax bracket is lower than the $3, 000, 000 tax bracket (or even half that. If you only spend the money after you get it, it will reduce the temptation to go through half your money in the first year after taking the lump sum.
reply
BKNY84
Lotteries are scams. I buy one ticket once in a while to give myself false hope. And if I play, I only play the State Lotto. Far better odds of winning compared to Powerball or Mega, and you don't have to go into hiding over winning $5 or $10m jackpot. And isn't that enough money I don't get why people spend tons of money chasing an impossible $750m jackpot.
reply
Lotteries are scams. I buy one ticket once in a while to give myself false hope. And if I play, I only play the State Lotto. Far better odds of winning compared to Powerball or Mega, and you don't have to go into hiding over winning $5 or $10m jackpot. And isn't that enough money I don't get why people spend tons of money chasing an impossible $750m jackpot.
reply
pentearmacaco
Even though the S&P 500 has an average increase of 10. 5% inflation has averaged 3. 5% over a long time. So, your invested lump sum increases at about 7%/year in today's dollars. Ignoring taxes on dividends, that would multiply your lump sum by 7. 6, or up to $6. 7M, not 19M. When you win, come to me and I'll 'splain it for a small fee.
reply
Even though the S&P 500 has an average increase of 10. 5% inflation has averaged 3. 5% over a long time. So, your invested lump sum increases at about 7%/year in today's dollars. Ignoring taxes on dividends, that would multiply your lump sum by 7. 6, or up to $6. 7M, not 19M. When you win, come to me and I'll 'splain it for a small fee.
reply
Eyes-of-Horus
Actually, the biggest mistake is not being able to win anything more than a couple hundred dollars once in a while. Can; t do much with that. Actually, if morre people would be able to win big since so many people don't know how to handle money there'd be a lot more money floating around the economy to make life easier.
reply
Actually, the biggest mistake is not being able to win anything more than a couple hundred dollars once in a while. Can; t do much with that. Actually, if morre people would be able to win big since so many people don't know how to handle money there'd be a lot more money floating around the economy to make life easier.
reply
djdante
USA lotteries are so shady! You can have all of it over 30 years (at which point it's worth signiificantly less than what it is today) - or a much smaller amount today. How does this even get permitted In Australia, we get what's published on the box - the exact amount - and also, it's non-taxable.
reply
USA lotteries are so shady! You can have all of it over 30 years (at which point it's worth signiificantly less than what it is today) - or a much smaller amount today. How does this even get permitted In Australia, we get what's published on the box - the exact amount - and also, it's non-taxable.
reply
shaylongoria5420
I unfortunately believe that by choosing to receive your money over the course of the next 30 yearsyou’re subsequently making a false promise to yourself (and your bank) that you will live for the next 30 years to receive your full sum. tsk tsk tsk. just seems like a setup to me!
reply
I unfortunately believe that by choosing to receive your money over the course of the next 30 yearsyou’re subsequently making a false promise to yourself (and your bank) that you will live for the next 30 years to receive your full sum. tsk tsk tsk. just seems like a setup to me!
reply
reaperz5677
Honestly even partial payments every year is too much. Why not give an option to do it every month, as well Would be a lot safer for people with poor impulses, and it would actually encourage people to save up their money and not spend it, in order to buy things like houses or something.
reply
Honestly even partial payments every year is too much. Why not give an option to do it every month, as well Would be a lot safer for people with poor impulses, and it would actually encourage people to save up their money and not spend it, in order to buy things like houses or something.
reply
EyeLean5280
GUYS, the stock market is not guaranteed to grow indefinitely. In fact, with populations dropping all around the world (except Africa, where they're projected to start dropping in about 25 years, it seems very unlikely that capital growth can continue at its past rates, if at all.
reply
GUYS, the stock market is not guaranteed to grow indefinitely. In fact, with populations dropping all around the world (except Africa, where they're projected to start dropping in about 25 years, it seems very unlikely that capital growth can continue at its past rates, if at all.
reply
Add a review, comment
Other channel videos
