I’m not a big fan of playing the lottery. I watch too many people come into convenience stores that should probably be saving the $10 to $20 they spend every 3 days on the lottery. My in-laws always give us about $25 worth of scratch-off lottery tickets which result in about $5 to $10. That’s not a very good return on their investment, and I’d much rather have the $25 in cash to buy a used video game or go out to eat. But, if you are addicted to playing the lottery, then here is a tip to remember.

The Wall Street Journal has an article about why you should take the money and run if you win the lottery tomorrow.

• Less taxes if you win it before 2010. The bush tax cuts reduced the highest tax bracket to 35%, but since they aren’t being renewed by the Democrats, it will revert back to 39.6% for the highest tax bracket. So, does this mean that people who play the lottery should all become Republicans? (just a joke)
• You’ll get a bigger lump sum if you take the money now. The lotteries calculate the lump sum based on the bond market interest rates and they have tanked lately, so the lump sums are much higher.
• Inflation. The inflation rate is 4.1%, so if you’re spreading out your payments over 20 years, that’s 4% that’s being taken away every year aside from the taxes.

Again, I don’t advocate being a habitual lottery player. Of course, if you are one of those people that play one set of numbers with one ticket per week, I don’t think $52 a year will break your bank. But, if you do play the lottery and have big hopes of striking it rich someday, take the advice of the Steve Miller Band and go on, take the money and run.