Second price jump in a decade
The price of a Mega Millions lottery ticket is poised to increase from $2 to $5, but with that will come payout benefits. Rumors of an impending price hike swirled in May and now, a slide deck from the Montana Lottery Commission’s Tuesday meeting gives more clarity to the potential upcoming changes.
If ticket sales go down, will the price make up for it?
The highlight for lottery players is obviously the 150% jump in ticket price. And this follows less than a decade after the price went up from $1 to $2 in 2017. The risk for the state lottery commissions is obviously whether or not the public will snatch up tickets at the same rate as they do now. What was once an impulse buy for many will be no longer. If ticket sales go down, will the price make up for it?
“What this will all boil down to is a question of price elasticity,” economist Richard Schuetz told LotteryGeeks.com last month. “Some products and purchases are very elastic, some not at all. For cigarettes, it’s very inelastic. People won’t quit smoking if the price goes up. Whereas with Coca-Cola, well, if the price of a Coke doubles, most people are going to move away from it.”
The Mega Millions directors will reportedly vote on the change this month at their annual meeting. The price increase would take effect next spring.
Better prizes, better odds
With the possible Mega Millions ticket price increase would come benefits to players. Odds of winning any sort of prize would go from 1 in 24 to 1 in 22.4, a 6.7% improvement. The odds of winning the jackpot, while still next to zero, would improve from 1 in 302 million to 1 in 278 million.
The starting jackpot would go up exactly the same percentage as the ticket price: from $20m to $50m. The expected average jackpot (remember, this is a progressive, multi-state lottery) would go from $387m to $694m.
every play will come with a random multiplier for any non-jackpot win
Arguably the biggest change aside from the price jump, especially considering only a few people win the jackpot every year, is that every play will come with a random multiplier for any non-jackpot win. Each time someone pays for a set of numbers, their ticket will also show a multiplier of 1x, 2x, 3x, 4x, 5x, or 10x, based on a pre-determined probability table. The average multiplier will be 2.87x.
Compare this to the current setup, which gives players the option to pay an extra dollar for the “Megaplier,” ranging from 1x to 5x for non-jackpot wins, and is determined before the Tuesday and Friday drawings. One can look at the auto-multiplier in the proposed changes one of two ways: a) as a happy, free bonus, or b) as a forced option baked into the price increase.
Exploding jackpots
Lottery jackpots have ballooned in recent years because of a combination of increased ticket prices and decreased chances of winning. When Mega Millions upped its ticket price from $1 to $2 in 2017, it also added more possible number combinations, worsening the jackpot odds from 1 in 259 million to 1 in 302 million.
largest Mega Millions payout of all time was $1.602bn
The six largest Mega Millions jackpots have all come in the last six years; five of the six were within the last three and a half years. The largest Mega Millions payout of all time was $1.602bn on August 8, 2023. The largest this year came on March 26, a whopping $1.128bn.
The expected average jackpot after the proposed changes is bigger than all but six in the history of Mega Millions.
Powerball, the other multi-state progressive lottery in the US, has had the two beefiest jackpots in the country’s history. The all-time record is $2.040bn, set on November 7, 2022; the runner-up came in at $1.765bn on October 11, 2023.