Some people think it's a ridiculous waste of money.
For others, it's a hope for instant fortune.
I'm sure many would think it's quite unbelievable for me to be wasting my money on Toto. Mathematically, it doesn't make sense.
What's the probability? 49 choose 6 = 13,983,816
So there's a 1 in around 14 million chance to win.
Cost of 1 purchase is $1
Potential winnings, $1m - $10m
So it's definitely not a fair game.
I think about it this way.
IF, every week I buy $6, over 52 weeks, this is $312 per year.
Some weeks I don't buy, I forget, or just can't be bothered, sometimes, we both buy, whatever. It's an estimate.
Over my lifetime, let's say I start buying at 20 years old until, 75 years old, that's a 55 year period.
I would have spent, $17,160.
So my rationale is, am I willing to spend $17k during my whole life, to buy a chance to win a sudden $1 million?
To me, every month, there is a winner. If I buy, I have a fraction of a chance. Else I have no chance.
Maybe you would think it's an entire waste.
Ok, so I'm sure some readers would think... Ok this guy is full of BS. On one hand saying that he's frugal, the other hand, unnecessarily burning money for no good reason.
Let me put it this way... from my other posts, some people may realize, I'm not deliberately frugal. I just don't want a lot of things. To me, there is no sacrifice. I'm not sacrificing the happiness of owning a nice watch, cos I want to save for the future. I just don't want or need the watch. That's it.
I don't think, if I kick my Starbucks habit, I would save XXX money every month and over a 20 year period, I would save YYY in total. No. I don't work that way. I don't count til this detail. I just don't drink Starbucks. I have no love for it. Sometimes I do, most of the time, I don't.
I look upon this whole frugal thing as a lifestyle. A very big picture point of view. Generally, I don't spend much. Cos I don't want much. That's why I've never provided nor tracked my actual expense. To me, if there is a perceived sacrifice, then there's something wrong already. Cos mentally, I would have already failed.
So how does this thinking join with buying low probability lottery?
Simply put, $6 per week, isn't significant in the whole scheme of things.
If I wanted to cut my expense, there are so many other things which I could cut. But that's not the point. Cos if I cut everything to the lowest levels, then I would just be eating economic rice everyday.
So $6 to buy a little bit of hope, an intangible product... isn't too much of a problem for me.
Most of us buy intangible products in many other ways. If you buy Panadol, you are already paying for intangibles, cos you could be buying generics at a cheaper price.
Anyway, I'm not trying to justify it. It's irrational, and I know it.
Rather, to me, in the grand scheme of things, it doesn't make much difference, I could easily save an additional $20 per week, without even having to think too much about it.
We ate a sashimi platter yesterday with a little bit of sake. Total cost, $50, consumed at home. It was an unnecessary snack. Not a meal. If I didn't eat it, it's straight off a savings of $50.
So that's it really.
Sometimes we eat unnecessary things, at other times, we don't.
Sometimes we buy unnecessary things, at other times, we don't.
Is Toto the answer to retirement? Definitely not.
And no, I do not encourage gambling. But I find absolutely nothing wrong with dropping a couple of bucks to buy the hope of instant fortune, as long as it doesn't affect your daily life.
Writing about Toto made me think about probabilities another way.
If you go to a casino and win at Blackjack 20 times in a row, with your first bet at $1. You would have earned $1 million.
Considering the house advantage is around 2% for Blackjack, I would just simply estimate the probability of winning each game to be 48%.
So to win 20 games would be (0.48^20) = 0.0000004215637
Or 1 in 2,372,331 chance. This is better than buying Toto in terms of probability...
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