Ranked: The 10 Worst States to Play the Lottery

The odds of winning the lottery are slim no matter where you play. But the odds are better in some states than in others.

Nationwide, the lottery pays out $0.67 in prizes per $1 spent, according to lottery statistics gathered by The Motley Fool Ascent. The best state to play is Ohio, where that goes up to $0.76 in prizes per $1 of lottery spending. What about the worst places to play? You'll find out below, and then we'll cover a much safer way to build wealth.

The 10 worst states to play the lottery

Here are the worst states to play the lottery and each state's prizes paid per $1 of lottery spending:

1. South Dakota: $0.21
2. West Virginia: $0.23
3. Oregon: $0.26
4. Rhode Island: $0.40
5. New Mexico: $0.55
6. North Dakota: $0.56
7. New York: $0.57
8. Wyoming: $0.59
9. Louisiana: $0.60
10. Delaware: $0.61

This is all from the most recently available dataset, which is lottery data in 2021. Most states are toward the middle of the pack, with $0.60 to $0.74 in prizes per $1 of lottery spending -- not far from the nationwide average of $0.67. Only nine states are outside this range.

The biggest outliers are South Dakota, West Virginia, and Oregon. Lotto tickets are never a great way to spend your money (unless you luck out and hit the big one of course), but they're particularly bad deals in those states.

There's no good place to play

Wherever you live, you're better off not playing the lottery. Remember that the highest average payout is in Ohio, with $0.76 in prizes per $1 in spending. So on average, people there lose $0.24 for every $1 they spend.

That also underscores the risk. Most people don't lose a portion of the money they spend on lottery tickets. They lose all of it, and only a few lucky winners come away with anything.

If you enjoy playing the lottery, there's nothing wrong with buying a ticket here and there. But the odds of winning the Powerball jackpot are 1 in 292 million, so definitely don't spend much money on it, and don't go in with expectations of winning big.

A better, more reliable way to build wealth

One of the most important things to understand about improving your finances is that it takes time. You can save money and build wealth if you follow good financial habits. Everyone wants to get rich quickly, but there's no reliable way to do this.

For anyone who isn't lucky enough to win the lottery, it's a longer process. If you'd like to start making financial improvements that will get you on the right track, here are the steps to take:

Always spend less than you earn

It all starts here. It's impossible to be financially stable if you're spending more than you earn. Keep your income in mind before taking on new bills, such as a larger car payment or rent. Ideally, try to spend no more than 60% of your income on your monthly bills.

Pay yourself first every month

This is an easy trick to get better at saving money. Instead of waiting, transfer money to your savings account right after you get paid. By saving regularly, you'll be able to build an emergency fund and savings for anything else you need, such as a vacation or a down payment on a home.

Grow your money by investing

In addition to saving, it's also important to invest a portion of your money every month -- 10% of your income is a good starting point. You can do this automatically through a 401(k) at work, if you have this option. You can also set up your own individual retirement account (IRA) or traditional brokerage account.

Look for ways to boost your income

Managing money gets a lot easier as your income increases. Consider asking for a raise, going job hunting, or launching a side hustle to earn more.

When you follow these habits long enough, you can get incredible results. If you're able to save $500 per month, that's $6,000 over a year.

If you're also able to invest $500 per month, that can help you build substantial retirement savings throughout your career. If you invest that for 40 years at an 8% annual return, a reasonable amount based on the stock market's average, you'd end up with $1.68 million. It's not as much as winning the Powerball, but the odds are a whole lot better.