Which States’ Residents Spend the Most on the Lottery & How Do States Spend Their Lottery Revenue?
LendEDU's fourth annual lottery spending report analyzed the most recent U.S. Census data to see what the average American is spending on the lottery, which states spend the most, and how each state spends its yearly lottery revenue.
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In the United States, the lottery offers one of the quickest routes to the American Dream; for just a few dollars, you could become a multi-millionaire in a matter of minutes.
Yet, the odds of that happening are incredibly slim, and the money spent on lottery tickets can quickly become substantial.
For the last three years, LendEDU has analyzed U.S. Census Bureau data on annual lottery spending by state to find how much the average American spends, in addition to each state’s lottery expenditure per capita.
Our fourth annual lottery spending report brings you those same statistics and some new ones. This year, we also broke down how each state spends its annual lottery revenue and what each state’s lottery expenditure per capita is as a percentage of its median household income.
Table of Contents:
- National & State Lottery Expenditure Per Capita
- State-by-State Lottery Expenditure Per Capita as a Percentage of Median Household Income
- State-by-State Annual Lottery Revenue
- How Each State Spends Its Lottery Revenue
Note: If you would like a raw file of any data found below, or if you would like any data found below presented in a different manner/graphic, please email me at [email protected]
Average Lottery Spending by Americans Hits Recent High
The U.S. Census Bureau releases its lottery spending data on a two-year lag, so the data that was released on January 31, 2020 reflects lottery spending data from 2018.
Since LendEDU started doing this report, lottery spending per capita in the U.S. hit a recent high in 2018.
In 2018, Americans spent a combined $76,362,627,000 on the lottery, while the most recent U.S. population estimate from the Census is 328,239,523.
This puts the lottery expenditure per capita in the U.S. at $232.64, which is up $13.10 compared to 2017’s figure.
Once Again, Massachusettsans Spent the Most on the Lottery
By taking each state’s total lottery expenditure from 2018 and dividing it by the most recent population estimate, we put together a map that breaks down state lottery spending per capita.
And once again, lottery players from Massachusetts spent the most on the lottery in 2018, $765.90. This figure is up from the state’s number from last year, $737.01. In comparison, North Dakota once again had the lowest expenditure per capita, going from $34.68 in 2017 to $30.32 in 2018.
For reference, six states do not offer a lottery: Alabama, Alaska, Hawaii, Mississippi, Nevada, and Utah. Washington D.C. does offer a lottery but does not report any official figures to the U.S. Census Bureau, therefore they have been excluded from this report.
State-by-State Lottery Expenditure Per Capita From 2016 to 2018
Below, you will see how each state’s lottery expenditure per capita has changed from 2016 to 2018 according to each state’s lottery revenue and population from each year.
Measuring Each State’s 2018 Lottery Expenditure Per Capita Against Its Median Household Income
Next, we measured each state’s 2018 lottery expenditure per capita against its median household income to see how much money is being spent on lottery tickets each year relative to what people make in a given state.
In 2018, West Virginia spent 0.96% of its median household income on lottery tickets, the highest percentage in the country. Conversely, North Dakota spent 0.05% of its median household income on lottery tickets, the lowest in the nation.
State-by-State Annual Lottery Revenue From 2016 to 2018
For many states, the lottery is a massive generator of revenue each year with 20 states making over $1 billion on the lottery in 2018. Collectively, the U.S. brought in $76,362,627,000 on the lottery in 2018, which was up from $71,826,684,000 in 2017.
On a state-by-state level, New York brought in the most lottery revenue in 2018: $8,585,199,000. And on the other end, North Dakota brought in the least lottery revenue in 2018: $23,103,000.
Breaking Down How Each State Spends Its Lottery Revenue
Included in the U.S. Census Bureau lottery dataset is a breakdown of how each state spent its lottery revenue in 2018. For the U.S. as a whole, 64.56% of 2018’s lottery revenue was used for prizes, 30.92% was earmarked as “proceeds available,” and 4.51% was used for administrative costs.
There was a wide-discrepancy in how states administered their respective lottery revenue. For example, Idaho used 78.53% of its lottery revenue for prizes, while West Virginia only used 16.97%.
Alternatives to Spending Money on the Lottery
While playing the lottery can certainly be fun, there might be a few different ways to better spend your money.
Below, LendEDU provides a few alternative spending avenues.
Save the Money For a Mortgage
If you are looking to become a homeowner, saving your money for a down payment on a mortgage is certainly one alternative to spending money on the lottery. With current mortgage interest rates at all-time lows, now might be the best time to look into this.
If you are still unsure, you can use LendEDU’s mortgage calculator to figure out what your home loan will cost you month-to-month and in-total.
Use it to Pay Off Your Student Loans
Another way to alternatively spend your lottery money is to use it to pay off your student loans fast. If you went to college recently, chances are you have student loan debt either from federal student loans, private student loans, or both.
If that’s the case, you can use the money you would have spent on the lottery to pay off your student loans ahead of schedule by likely saving some cash on student loan interest.
Or, Pay Off Other Forms of Debt
If you don’t have student loan debt or are not too worried about the amount you have left, you could always use your lottery spending money to pay off other forms of debt that may be holding you back.
All lottery data found within this report was pulled from the U.S. Census Bureau. We used the data from the 2018 Annual Survey of State Government Finance Tables, which was last revised on January 31, 2020. Specifically, we used the data found within the “Income and Apportionment of State-Administered Lottery Funds: 2018” label. This data provided the revenues generated from the lottery in 2018 and also included how the lottery revenue was disbursed in each state. Due to 2019’s data not being released until 2021, this is the most recent lottery data available.
The second data source used was the U.S. Census Bureau’s State Population Totals and Components of Change: 2010 – 2019, which was used to find the population figures for each state and the entire country. Specifically, we used the data found within the “Annual Estimates of the Resident Population Change for the United States, Regions, States, and Puerto Rico: April 1, 2010 to July 1, 2019” label. This is the most up-to-date population data from the U.S. Census Bureau and was last revised on December 30, 2019. Each state’s lottery revenue was divided by the same’s state’s population for 2019 to find the yearly lottery expenditure per capita. Lottery expenditure per capita figures from the previous year were carried over from LendEDU’s previous reports.
The third and final source used was GreatData, whose dataset is licensed by LendEDU. GreatData’s data derives mainly from the U.S. Census Bureau, but GreatData also calculates and combines its own projections based on historical trends to provide the most up-to-date data. GreatData’s data was used to find the median household income for each state and the country as a whole. Each state’s lottery expenditure per capita was divided by its median household income to find the lotto-to-income ratio.
Note: If you would like a raw file of any data found above, or if you would like any data found above presented in a different manner/graphic, please email me at [email protected]
See more of LendEDU’s Research here.
Author: Mike Brown