Save. Spend. Splurge.

Do you count on the lottery as part of your retirement plan?

My parents kind of do. Not as much as before, but I can see the desperation/hope in their eyes.

At least, before I got a hold of their finances (all the papers they didn’t try to hide from me by putting them into pots and pans), gave them a budget, a financial plan, and told them to start tracking their expenses with my budgeting tool.

They’ll be debt-free in April 2013, about 3 years sooner than the path they were currently on.

If I had gotten to them sooner, it would have been an epic debt repayment…

They now clear about $2500 of debt per month on their new plan, instead of paying the minimums and my mom can’t help but proudly show me the statements each month of how much debt she is knocking down on her line of credit and mortgage.

Before all that, they thought the lottery was their retirement plan.

The background to this insanity, is that my family won a small jackpot about 20-ish years ago.

With that money, a fancy trip for the whole family, a big splashy dinner, 2 fancy $10,000 watches, a new house and a new car later, they were on their way to what they thought was millionaire status.

Except that my parents didn’t work more than part-time jobs for about 10 years.

My mom had to go back to school in middle-age, and my dad .. well, he only had a high school degree.

About 8 years ago, secured a very stable job making more than the average Canadian household income (note: the average household income is about $75,000).

Throughout that entire time before they got that stable job, they played the lottery. 10, 20 tickets a week, casino trips almost bi-weekly.. it was a drug.

A lottery-fueled addiction and desperate hope that they would AGAIN strike the lottery jackpot.

It sounds extremely ridiculous, because who realistically wins 1, let alone 2 jackpots in their lifetime!? 

But that was their financial plan, something I discovered early last year.

I sat down with my parents, explained to them it was improbable and ridiculous to dream like that, particularly since they were nearing retirement quite quickly, and gave them a budget to follow, which they have done quite admirably so far.

My parents are far from being alone. I watched a documentary Lucky, that stated:

Every year Americans spend. [….] $62 billion on lottery tickets.

More than half of all American adults play the lottery making it, by far, the most popular form of paid entertainment in the country.

Odds you believe your best shot at getting rich is winning the lottery: 1 in 5.

Odds you will actually hit the jackpot in a Powerball lottery: 1 in 195,249,054.


I always think that playing the lottery is like taxing the poor. They willingly do it because they think they’ll be the lucky ones, so they bet their meager earnings on a ticket.

I agree statistically speaking that playing 4 times a year makes sense. Can’t win if you don’t play, but that’s 4 tickets out of 52 in a year you should be buying.

It’s about $20 at a chance to win that you should be spending in a year.

Worst of all, even if you win the lottery, it could turn into a nightmare, here are stories about people who hit it big but ended up regretting it: Unlucky and Tragic Stories of Lottery Winners.


It’s just hard work and changing your mindset to be disciplined enough to save as much as you comfortably can.

You have to have a household budget.

You have to save at least 10% (I like 15% – 25% better) of your net income at the very least.

You have to track your expenses.

You have to be aware of what you’re saving all this money for, like your goals.

You have to understand that life is meant to be lived, but in moderation.

It is not fun, it is not easy and it is certainly not as sexy as being able to do whatever the heck you want with your money.

…but it’s the only way to make it.



  • Ree Klein

    I know I shouldn’t be, but I’m dumb struck at your parent’s story! I worked with a man who won a $1m lottery in NY. He and his wife chose the yearly payments which amounted to something like $35k a year. When he told me the story I asked why he was still working…he said, that barely covers the gardener in NY. My response was, I’d move to a state where that would cover my living costs.

    Holy heck…

  • Pauline

    I don’t play the lottery and have only gambled once in Vegas so wouldn’t count on that too much. I wonder how much of your parents’ jackpot went back into gambling and lottery tickets for all those years, bi-weekly $100 casino trips cost $20K a year!!

  • MelD

    Wow, I have never in my life bought a lottery ticket, or won anything, for that matter. And I’m not about to start, either!
    Although we never got into real debt (we now have a very reasonable mortgage – thank goodness I woke up to reality before we spent too much!), we did ruin more than just our financial situation by living not above our means but very close to the edge, i.e. we took on 4-year leasing contracts for two cars while we had a young family, which was a BIG mistake – monthly payments, bigger cars, higher maintenance, higher insurance… So glad we learned our lesson from that one. Took years of unpleasant consequences too varied to mention to get over that time, though, which was a shame for our family, but I guess that’s life. No regrets, we look forwards, and the future is very bright indeed (as is the present!)…

    Everyone: make sure that if your kids don’t get financial behaviour advice at school, they get it at home – and for that, you need to be (financially) educated yourself!!

  • PK

    1 in 175,223,510.00 they mean! (And this changes based on the number of tickets bought and the number of drawings they enter – math is similar but slightly different).

    Okay, I know I’m not helping – I only play very rarely.

  • Tammy R

    We never play the lottery. I just don’t even think about it. I know my luck has come from getting my head out of my butt and getting serious about money. We weren’t terribly in debt. We weren’t horribly in debt. We were just in debt and sticking our heads in the sand. Now, we’re actively reducing debt. It only took us a few months to pay off two loans that, in hindsight, should have been paid off years ago. Holy moly! Lottery schmottery! We’re paying down debt and contributing to retirement funds. Thanks, Mochimac!

  • Debt Blag

    My word. I can’t believe that this story *starts* with them winning the lottery.

    I haven’t played any sort of lottery since my 18th birthday, when I did it because I needed to mark it with something and that day wasn’t a voting day, nor did I want to smoke. I always tell myself that lotteries wouldn’t exist if they didn’t make money off their participants.

  • cj

    Any time we begin to choose luck over effort to get what we want, we are in trouble. Those stats are staggering to say the least. What an excellent post! Thanks Mochimac!

  • Leslie Beslie

    I regularly tell the story of how your parents played the lottery MORE after they won. That is still mind boggling to me!

  • Jane Savers @ Solving The Money Puzzle

    I buy tickets when the prizes are very high. It is a dream but someone has to win right? I know it will never be me and I don’t want to win a big, life changing prize.

    $100,000 would completely change my life but $15,493 would wipe out my debt and allow me to start saving for retirement.

  • StackingCash

    LMFAO!!! Me! Me! Me! In fact we just played the Megabucks slot machine a few hours ago. Because our income feels so limited and do not invest in the stock market, we feel compelled to play. However, we have a pretty good limit as of late. I have budgeted about $20 a month for gambling. Not too shabby considering we live in Las Vegas, NV. At least we don’t drink and smoke 😛

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