The Lottery or Slot Machines? Which is the Better Bet?

By Randy Ray
Published on March 15, 2018
Person Wondering About Slots or Lottery Tickets

Slot machines and the lottery have their obvious differences. But these gambling games are also similar in that they’re completely random.

The lottery is random in that you never know which lucky ticket(s) will be chosen as a winner. Slot machines offer random results across 3 or 5 reels.

These are both good games for anybody who likes a pure gamble. But what’s the better bet here?

This is a hard question to answer because there are multiple types of slot machines and lottery tickets that each offer different payback. You also have to consider the rate of play.

That said, keep reading as I use payback and play rate to determine the best wager.

Slot Machines Payback

How are Slot Machine Payouts and Payback Determined?

Slot machines have random number generators (RNG) that decide when payouts are delivered. An RNG cycles through thousands of number combinations to determine results.

The fact that this program goes through so many different numbers ensures that players can’t predict spins.

The RNG busts a popular myth that you can somehow time spins perfectly to win more often. It also cuts through another myth that somebody can “steal” your jackpot after you leave a machine.

Slots payback is determined through a combination of how frequently each prize is delivered along with the size of each payout.

Progressive slot machines differ in that they feature variable payback or return to player (RTP), based on the jackpot’s size. Here’s an example:

  • A slot machine has base payback of 88%.
  • The progressive jackpot is seeded at $100,000.
  • The payback increases from here, because the jackpot is also growing.

Standard Land based Slot Machine Payback

Land based casinos can choose what payback they want their slot machines to offer. This means that you can play the same slot machine in two different casinos and face a different RTP.

Gaming jurisdictions have minimum requirements for how much slot machines must pay out. Here are few examples involving different American states:

  • Arkansas = 83% payback
  • Delaware = 87%
  • Kansas = 87%
  • Louisiana = 80%
  • Maryland = 87%
  • New Jersey = 83%
  • Nevada = 83%

These required payback figures are low compared to what’s really seen in the industry. Land-based slot machine payback typically ranges from 85% to 98%.

The difference is based on the coin denomination and specific casino. Higher denomination slot machines normally pay more than the lower denominations.

Here’s a standard range for what you can expect:

  • Penny slots = 85% to 88%
  • Nickel slots = 89% to 91%
  • Dollar slots = 92% to 94%
  • $5 slots and up = 95% and above

Certain casinos offer higher average RTP than other gambling establishments. All of this combines to make slots payback in brick and mortar casinos a confusing topic.

But generally, all you need to do is look at the coin denomination to get a good idea on what type of payback to expect.

Standard Online Slot Machine Payback

Online slot machines are superior to the land-based variety in two ways:

  • Payback is normally higher.
  • You can expect games to pay the same across different casinos.

Online slots payback can range from 94% to 99%. But the average for modern internet slot machines is 96%.

This is obviously better than slot machines in brick and mortar casinos. And the reason why online casinos can offer higher RTP is because they have less overhead costs to worry about.

This is especially the case when considering that internet casinos don’t have to buy slot machine cabinets. Instead, all they’re doing is offering games through the internet.

Another good thing about online slots payback is that it usually stays the same regardless of if you’re betting $0.01 per line or $1. This is in stark contrast to land-based slot machines, where you need to bet $1 or more to enjoy higher payback.

But as for the second point, online slots makers usually offer a uniform payout percentage at every casino they serve. For example, you can expect NetEnt’s Blood Suckers to feature 98.0% payback no matter you find it.

Lottery Payouts

How are Lottery Payouts Determined?

A lottery drawing issues tickets to players, with fixed odds of winning each prize. Here’s an example of the prizes and odds offered in Powerball:

  • 5 correct numbers + Powerball number = Jackpot (1 in 292,201,338.00 odds)
  • 5 correct numbers = $1,000,000 (1 in 11,688,053.52)
  • 4 correct numbers + Powerball number = $50,000 (1 in 913,129.18)
  • 4 correct numbers = $100 (1 in 36,525.17)
  • 3 correct numbers + Powerball number = $100 (1 in 14,494.11)
  • 3 correct numbers = $7 (1 in 579.76)
  • 2 correct numbers + Powerball = $7 (1 in 701.33)
  • 2 correct numbers = $4 (1 in 91.98)
  • Powerball = $4 (1 in 38.32)
  • (The overall odds of winning any prize = 1 in 24.87)

The odds of winning in Powerball or any other major lottery remain the same no matter how many tickets are sold. Furthermore, the number of prizes increase along with the amount of tickets in circulation.

Players can either pick the numbers themselves or have a lottery retailer’s machine select the numbers (a.k.a. quick pick). The odds don’t change either way, because the results are completely random.

Scratchcards work the same way as lottery drawings in terms of fixed odds and how prizes are distributed. The only difference is in how these games are played.

You scratch these cards to reveal symbols or numbers. The hope is that you match enough symbols/numbers to win a prize.

Standard Payback for Lottery Drawings

Lotteries are notorious for offering the worst payback percentage in gambling. The major drawings like Euro Millions, Mega Millions, and Powerball offer around 50% payback.

Italy’s Super Enalotto used to only pay back 34.65% of ticket sales, which is atrocious. Only in recent years did they raise this to 60%.

But even at 60%, lottery drawing payback doesn’t begin to compare with slot machines. The only casino game that’s comparable is keno, which occasionally pays as little as 60% in rare instances.

Another thing to worry about here is win frequency. I showed in the Powerball example that your chances of winning any prize are just 1 in 24.7.

Slot machines aren’t the greatest in terms of payout frequency either, but you can at least expect to win 10 15% of the time on each payline. This only gets better when you play more lines.

Standard Payback for Scratchoffs

Scratchoffs (a.k.a. scratchcards) are like slot machines in that payback varies based on the cost of the ticket. Convenience stores commonly sell scratchcards at prices ranging from $1 to $10.

The dollar tickets pay back anywhere from 50% to 60%. This is a bargain compared to lottery drawings, given that you’re paying half the price and sometimes earning a higher return.

$5 scratchoffs pay anywhere from 60% to 65% on average, and $10 scratchcards pay back around 70%.

Based on this, it makes sense to reach for the $10 scratchoffs, but take into consideration that you’re going to lose more money over the long run.

Here’s a comparison:

  • 100 scratchoffs at $1 each x 50% payback = $50 loss
  • 100 scratchoffs at $10 each x 70% payback = $300 loss

If you’re a lottery high roller, then it certainly makes sense to play $10 scratchcards due to the higher payback. Don’t buy these tickets simply because they have a larger payout percentage, as you’ll likely lose more money anyways.

Standard Payback for Online Scratchcards

Online scratchcards are more generous than their land-based counterparts. You can often expect to earn anywhere from 90% to 95%, depending upon the gaming provider.

This is at least 20% higher than the most expensive scratch offs sold in convenience stores, and you can play online scratchcards for anywhere between $0.50 and $1.

Internet scratchcards are similar to physical cards for the most part. You use your finger (via smartphone) to scratch off the spaces, just like you would with a physical ticket.

Another advantage to online scratchcards is that you don’t have to go anywhere to buy them. Instead, you simply pull out your phone or tablet and play them.

Speed of Play with Slot Machines and the Lottery

Both online and land-based slot machines offer much higher payback than lottery drawings.

In fact, the only lottery form that can compete with slot machines is online scratchcards, but these are treated more like an internet casino game than a traditional lottery.

The one way that lottery games can compete with slots, though, is through the speed of play.

Most lottery players buy a few tickets a week and wait until numbers are drawn. Slots players, on the other hand, may perform hundreds or even thousands of spins in a session.

Here’s a comparison on the play rate between slot machines and lottery drawings:

Lottery player

  • Buys five Mega Millions tickets at $2 a piece = $10 total bet
  • Mega Millions pays back 50%
  • 10 x 0.50 house edge = $5 loss per week

Slots player

  • Plays a quarter slot machine with 90% payback
  • Performs 600 spins ($150 bet) per hour for 5 hours = $750 total bet
  • 10 house edge x 750 = $75 loss per session

This example shows why the average slot machine player loses more than a lottery player.

But the other thing to understand here is that the slots player is getting far more entertainment than waiting for a single drawing. Instead, they’re spinning the reels for hours.

If we’re to measure the costs for each hour of entertainment, you could make a compelling case that slot machines are superior in this regard.

What is the Better Bet?

If you and I are judging which game is better in purely in terms of payback, then slot machines win hands down. The lowest paying slot machines pay at least 85%, while most deliver between 90% and 95% RTP.

In contrast, lottery drawings only pay around 50% on average. And you need to purchase $10 scratchoffs if you want to get up around 70% payback.

But we also have to consider the typical nature of a slot machine player and a lottery player.

As covered earlier, most lottery players only spend a few dollars every week. And while they’ll earn less money back on average, their low betting volume keeps them from losing too much.

Slot machine players usually engage in sessions that last one hour or more. This can cause you to lose a lot of money if you’re not careful.

But again, slots deliver more entertainment value when factoring time into the equation. After all, slots players can go for hours on a penny, nickel, or quarter machine with $100 or more.

Lottery players, meanwhile, spend a couple minutes buying their tickets. And while they may also watch the drawing, this only equates to around 30 minutes of weekly entertainment.

Long story short, deciding which game is the better bet is a subjective matter.

Slot machine players prefer the graphics, sounds, and fast paced action of slots. Lottery players enjoy spending a few dollars to chase life changing jackpots.


Slot machines and the lottery feature plenty of overlap in terms of their player bases, but you’ll also find gamblers who strictly like one game over the other.

The point of my post isn’t to steer you towards either slot machines or the lottery. Instead, I want to show how both forms of gambling can make their case for being the best wager.

I personally like how slot machines provide hours of entertainment and better payback. I’m also not against buying a few lottery tickets when the Mega Millions or Powerball reach an enormous amount.

In summary, keep what I discussed about payback, play rate, and entertainment value in mind. Feel free to use this to help you next time you’re on the fence about whether to buy more lottery tickets or play slot machines.

The Lottery or Slot Machines? Which is the Better Bet?
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The Lottery or Slot Machines? Which is the Better Bet?
Players who enjoy the lottery usually also like slot machines. But which game actually offers the better odds and the most fun? We discuss the pros and cons of both in this article.
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