NORTHVILLE, MI (November 4, 1999) -- The other day I ran across a story on the newswire that left me somewhat puzzled, and appropriately enough for the Halloween season, downright frightened.

I realize that Foolishness, while growing rapidly, has yet to reach every corner of the universe. I'm aware that not everyone is managing their own money and comfortably making their own financial decisions. I know that many are not yet matching or surpassing market returns, without losing sleep or fertilizing an ulcer. It does not escape my attention that for far too many of our brothers and sisters, reading a balance statement means scanning the last line of a credit card bill. Never, ever, would I have fathomed, however, what I was about to glean when I read the following opening line:

"One-quarter of Americans believe their best chance to build wealth for retirement is by playing the lottery, not by patiently saving and investing, a survey says."

After quickly glancing at my calendar to ensure that it was indeed not April 1st -- I've been tricked by those prank Fool's Day stories before -- I managed to evoke a single word...


Associated Press writer Alice Ann Love went on the explain that a survey sponsored by the Consumer Federation of America and financial services firm Primerica indicated 27% of Americans believe winning the lottery or a sweepstakes is "their best chance to obtain a half a million dollars." Among households with annual incomes of $35,000 or less, the number sharing that conviction grew to 40%.


Not only has Foolishness yet to reach the living rooms of everyone in America, it's apparently been locked out of some homes, left standing in the cold with its nose pressed up against the window!

Let's look at this marvelous method of obtaining wealth known as the lottery:

If you invest $10 a week in lottery tickets, after 30 years, you will have invested a total of $15,600. The return on this investment? Realistically, zero. The odds of winning the lottery are an astronomical 10 to 20 million to one. There's a better chance of the Saints winning the Super Bowl! The actual rate of return on a lottery ticket is -50% -- that is, for every dollar you put in, on average, you lose half of it. So, what I'm hearing is the best chance to build wealth for retirement is to throw away half your money!


Now, let's look at that same $10 a week, invested instead in Drips, earning a return of 15% a year. The value after 30 years? $259,977.60.

Which sounds better, zero or $259,977.60? Wait, I'm not being fair here. Factor in the 27 seconds of exhilaration one feels while flipping through the newspaper in dream-filled anticipation before realizing that those six digits just don't match. Makes the choice much less clear-cut, I know.

Increase that to $100 a month, the return soars to $599,948.30. One-half million dollars can, indeed, be saved by putting $23 a week into market-leading and market-beating businesses. You don't even have to stand in line or scratch off any gray spots.

I hear what you're saying: "Vince, my man, you're preaching to the choir. We're Fools here. We are saving our money. We're not gambling on a chance for a comfortable retirement. And quit picking on the Saints. The season's far from over."

Yes, you're right, as usual. What we need now is to reach those 27 to 40% who believe, remarkably, that the ability to retire comfortably is as obtainable as winning an Olympic gold medal or marrying a supermodel. Word must be sent that a few dollars a week, a little homework, and a whole lot of patience can produce what a lifetime of lottery tickets realistically will not for almost everyone that plays -- a secure future.

If you're aware of anyone who is convinced that modest wealth cannot be achieved by regularly buying into the planet's elite business leaders, who feels that saving a few dollars a week will never amount to anything, who is more likely to purchase a lottery ticket than drop a Hamilton into the stock market, get the word to them somehow, some way, anyway you can. Let them borrow your Investing Without a Silver Spoon book. E-mail them this column, if you feel it's worthy. Buy late night infomercial space on cable television -- anything! Just please do not let that belief go on for another day. I couldn't take the shock of reading another article like this one: Many See Lottery As Way to Wealth.

Drip on, Fools!