If you turn up at a convenience store in the hope of buying a couple of lottery tickets, be ready to be turned away if you’re only carrying credit cards. Regardless of how big your credit card limit, it carries no weight in the realm of the lottery. But don’t get annoyed at the cashier. They’re not turning down your money to be difficult. In most states, it’s forbidden by law for credit cards to be used for that purchase of lottery tickets. Even if that friendly cashier wanted to help, it’s more than their job’s worth to get it done. But why exactly is it against the law to use a credit card for lottery purchases? And why should you think twice about doing it even if you reside in one of the few states that don’t come with an outright ban on the possibility? Discover as we explore the reasons why cash is king when it comes to lottery tickets.
The Law and also the Lottery
We’ve all become accustomed to buying everything on plastic, just about everyone has given up on cash almost completely. But you may still find a few areas where credit cards really are a no-go, the lottery being one. Some of us think that it’s down to the discretion of individual stores to decide what payment methods they accept, the guidelines around the lottery are determined on a state level. According to usatoday.com, roughly 24 US states currently ban the purchase of lottery tickets on credit cards. But the rules are in no way clear cut. Flash your charge card in Washington, DC., and you’ll be politely declined regardless of the store you visit; perform the same in Indiana, and it’s as much as the store whether they accept it or otherwise.
States That Prohibit Credit Card Lottery Purchases
Currently, the following states either don’t permit you to use credit cards for lottery purchases or don’t run in-state lotteries.
- New Hampshire
- New Jersey
- New Mexico
- North Carolina
- North Dakota
- South Carolina
- Washington, D.C.
- West Virginia
States That permit Credit Card Lottery Purchases
In contrast, the next states don’t have too a lot of an opinion on whether you utilize a credit card, a debit card, or cash for your lottery purchases:
- New York
- Rhode Island
- South Dakota
However, even in those states that allow you, theoretically at least, to buy using plastic, you might still be turned away at the store. As thebalanceeveryday.com notes, certain states, while avoiding an outright ban, will still only allow you to use your credit card at certain retailers and under specific conditions. If you turn up at Safeway in any of the listed states, for example, you’ll only come away having a lottery ticket if you have cash or a debit card (although that said, some stores have even taken it a step further by banning debit cards too). You’d therefore need to look at your individual state lottery policies to be certain.
The Explanation for the Ban
If you’re struggling to get your head around why a state would be happy enough that you should buy a lottery ticket with cash but prohibits you from doing the same with a charge card, you’re not the only one. But in actual fact, the explanation behind the ban is fairly straightforward. The state is basically looking out for you. They don’t would like you racking up debts on lottery tickets or gambling with money you don’t have. A lottery ticket might not seem like the most expensive thing in the planet, but add on the interest you’ll end up paying on your credit card bill if you don’t clear the balance at the end of the month, and it suddenly gets far more expensive. According to bankrate.com, those from lower-income households take part in the lottery significantly more than those from higher-income households. Twenty-eight percent of households with annual incomes below $30,000 take part in the lottery at least once a week, while only 18 percent of homes that earn $75,000 or more do the same. Cash-strapped households spend an average of $412 per year on lottery tickets, almost 4 times the amount of those in the higher income bracket.
While people are free to do what they like with their money, the problems start when people spend money that isn’t technically theirs. People with a low income and a similarly low credit rating could end up paying around 25 percent interest on each ticket they buy on credit. For households spending typically $412 per year on lottery purchases, that’s over $100 in interest during the period of a year. “States don’t want customers to rack up credit card debt buying lottery tickets, particularly when the odds of winning the Mega Millions jackpot are slim to none,” Kimberly Palmer, credit card expert at NerdWallet, tells USA Today. “If you aren't someone that makes an occasional acquisition of lottery tickets with a charge card that you pay off at the end month, it’s a bad idea to pay for your lottery tickets with plastic,” Ted Rossman, an industry analyst at CreditCards.com, adds.
Why You Should Never Use a Credit Card for the Lottery
Even if you live in one of the states which don’t operate a ban on using credit cards for lottery purchases, there are multiple reasons why you should think long and hard before you do. For a start, playing the lottery might seem like harmless, frivolous fun, but it can sometimes act as a gateway to a gambling addiction – which, as anyone from Gamblers Anonymous will tell you, is anything but frivolous and fun. Paying by cash a minimum of ensures you don’t buy more tickets than you can actually afford, reducing the risk of falling in to the trap of addiction. Secondly, your odds of winning the lottery are, despite what the organizers want you to think, alongside none. As the independent.co.uk says, you’re more prone to win an Oscar, become a successful Olympian, get struck by lightning, or die from the plane part falling from the sky and hitting yourself on the head than you are to get a windfall. Getting sucked into debt on the promise of something that, realistically, is never going to happen is just not worth the price.