Tonight’s EuroMillions jackpot stands at £169m which is undoubtedly a staggering amount of money. Just imagine what you could do with that kind of wealth – you could potentially buy your own private jet, superyacht, and a few private islands as well!
However, while I realise that you need to be ‘in it to win it’, I’m not interested in spending £2.50 on a ticket for tonight’s jackpot. Here’s why.
To win the jackpot, you need to land five correct main numbers from a pool of 50, as well as two ‘Lucky Star’ numbers from a pool of 12. While this may not sound so challenging in theory, in reality, the odds of winning are extremely poor, at one in 139,838,160.
To put that number in perspective, the combined population of the UK, France, and Ireland is pretty close to 140m people. In other words, if you lined up every single person in these countries and offered them a EuroMillions ticket, only one person would win.
I don’t know about you, but those odds sound pretty lousy to me, so instead of blowing £2.50 on a lottery ticket, I’ll be saving my hard-earned money and putting it to work elsewhere.
One place that I am willing to put my money right now is the stock market.
Stock market investing gets a bad reputation at times because stocks can be volatile and short-term investors sometimes lose money. However, history shows that over the long term the stock market tends to rise, meaning that if you’re patient, and you invest for a number of years, there’s a good chance you’ll increase your wealth. Unlike EuroMillions or the National Lottery, the odds of making money are actually in your favour if you’re willing to invest for the long term. Stick at it, and the stock market could help you generate life-changing wealth.
You can start with just £100
I’ll point out that you don’t need a lot of money to invest in the stock market. These days, you can open an account with an online broker and put your money into an investment fund (where your money is pooled together with money from other investors and managed by a professional fund manager) with as little as £100.
You’d be surprised at how quickly a small investment like this in the stock market can grow. For example, assuming an average rate of return of 8% per year (which is a reasonable return to expect from a diversified fund), an initial investment of £100, followed by a monthly investment of £50, could grow to around £4,000 after five years, according to my calculations. Increase your monthly investment to £100, and your money could grow to around £7,500 after five years if you consistently generated a return of 8% per year.
Ultimately, I see the choice between spending £2.50 on a lottery ticket, where the odds of winning a major prize are extremely poor, and investing regularly in the stock market, where the odds are stacked in your favour, as a no-brainer. The former offers little chance of making money, while the latter has proven to be an excellent way of generating wealth over the long term.
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Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.