Scratching to retirement?

Published 12:00 am Thursday, November 4, 1999

From staff reports

Scratch, scratch, scratch.

Thursday, November 04, 1999

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Scratch, scratch, scratch. One-quarter of Americans believe this is the way to build wealth.

We’re talking about the lottery, be that scratch-off tickets, or the pick-a-number variety.

Astoundingly, one-quarter of Americans believe their best chance to build wealth is by playing the lottery, not by saving.

In fact, 28 percent of Americans believe winning a lottery or sweepstakes is their ”best chance to obtain a half a million dollars or more in your lifetime.”


A review of the odds is in order.

The odds of winning a big lottery jackpot are 10 to 20 million to one.

But, the odds of accumulating hundreds of thousands of dollars through regular saving are virtually guaranteed. A family that saves $50 a week can have $1,026,853 after 40 years, given a 9 percent yearly yield.

And, $25 invested weekly for 40 years at a 7 percent annual yield would amount to is $286,640.

Saving does not have to be difficult.

U.S. Savings Bonds are easy, with $50 Series EE bonds selling for half their face value, or $25. The government even sells them online now at, but they are also available at local financial institutions.

There are also bond and stock mutual funds with low starting balances, many of which also allow automatic deposit and other features. Stock funds are slightly more complex, with investors required to decide how much risk they are comfortable with, but tend to offer a higher return over time.

Publications such as &uot;Consumer Reports&uot; publish yearly reviews of stock and bond mutual funds, and are available at the public library. Banks and brokerage firms should also do their part to educate potential investors about the options that are available and the importance of saving.

Clearly, most people need to do a better job of preparing for their financial futures.

And while the lottery is a legal activity that benefits the state, it is not a retirement vehicle.

Do not count on the lottery to be there for one’s golden years.