Lottery Pools: What They Are and How They Work

Lottery pools are common in workplaces all across the United States. Here are the potential rewards and risks that come with participating in one.

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Adam Moelis
Nov 10, 2022
8 min read

Winning the lottery is one of the least likely things to happen. Only a handful of fortunate people each year will win the lottery. The key to winning the lottery is increasing your odds in any way possible.

Not all lotteries share the same odds of winning. There are a few that offer big-time prizes that have much more favorable odds. These odds are essentially 0%, but they’re still higher than some lotteries. 

Participating in a lottery pool is the most popular method for improving your odds. Once again, the increase to your odds will be virtually negligible and only slightly move in your favor. 

However, joining a lottery pool is an excellent way to play the lottery frequently with slightly better odds and not worry about spending too much on tickets

What Is a Lottery Pool? 

A lottery pool is a group combining their money to play the lottery. Each member will add money to the collective pool, and the funds are used to purchase lottery tickets. The entire group will split the winnings evenly if any of these tickets are winners. 

The more people that join a lottery pool, the more tickets can be purchased for the same individual cost. The trade-off for these increased odds is that the payout will be much smaller than playing solo. The winnings would have to be split amongst the people in the pool, so you’d win considerably less. 

How Do Lottery Pools Work? 

There are no clear-cut rules that a lottery pool must follow. The majority of lottery pools are made to be as simple as possible. 

A single person collects the money from members of the pool, then purchases as many tickets as possible. Should any tickets prove winners, the prize is split evenly amongst all members. 

For example, let’s say that a group of 30 people decide to create a weekly lottery pool with a fee of $5 each. The assigned member would collect the money from each member and use the $150 to buy tickets. 

If a ticket were to hit a $1 million prize, the money would be split 30 ways. Each member would receive 3.3% of the award or roughly $33,333.33 before taxes. 

Most lottery pools will operate on the principle of equal fees and equal shares. However, that’s not the only way to run a pool. 

Another option to increase your odds even further would be to employ a “shares” system. The idea is that if a member paid in more money than others, then they would receive more shares of the winnings. 

Let’s use the same information from the earlier example, except one member has designed to pay $25 each week instead. By funding the purchase of more tickets, the pool member would get a more significant percentage of the prize. 

The $1 million would be split 35 ways, with the individual receiving five total shares. Instead of everyone getting $33,333.33 before taxes, the individual would now be in line to receive $142,857.14, with the rest being split evenly. 

You can probably imagine running this type of lottery pool would be pretty challenging. The potential for confusion and in-fighting is often very high, so it’s not as common. However, the potential for a more significant cut of the rewards can fuel a much higher turnout. 

The more tickets being purchased, the higher the odds of winning are for everyone. It’s only fair that someone spending more money gets a bigger piece of the pie. 

How Do You Set Up a Lottery Pool?

Setting up a lottery pool isn’t particularly difficult. All it takes is a group of trustworthy people with the shared goal of winning the lottery. However, there are a few things that you can do to make sure that your lottery pool operates as smoothly as possible:

  • Only get involved with people that you know personally and trust implicitly.
  • Elect the most dependable person to act as the pool manager. The responsibility of a pool manager includes tracking the members, collecting the money, buying the tickets, selecting the numbers, and monitoring the drawings. 
  • Keep detailed records of the money that is collected for each drawing.
  • Take pictures of all the purchased tickets and share them with the other pool members.
  • Create a contract for everyone to sign that clearly states the rules and terms of the lottery pool.
  • Vote on issues such as how winnings are divided, what numbers are played, the lottery you’ll play, and whether to accept a lump sum or annuity payments.
  • Write out a public list of all the active participants and post it so everyone can see it.
  • Establish the amount of money due and when it’s to be collected.

What Happens When a Lottery Pool Wins? 

The goal of a lottery pool is to maximize the odds of winning the grand prize. If the pool is lucky enough to win the grand jackpot, the award is split amongst the members based on the established rules. 

Each member will get their share, celebrate accordingly, and go their separate ways. The tricky thing is what happens for prizes that are less than the jackpot. 

In addition to the main jackpot, every major lottery offers a variety of prizes. Winning a prize consisting of only a few dollars is hardly worth the trouble of dividing into equal shares. 

For example, a $12 prize split 30 ways is only 40 cents a person. Not exactly enough to make you quit your day job. 

For that reason, it’s common for most lottery pools to have rules on what to do with smaller prizes:

  • Divide the money evenly, no matter how small the award can be.
  • Apply the funds to the following drawing to purchase more tickets.
  • Save the money and fund activities for the entire group (pizza party, movies, and bowling).

Who Can Join a Lottery Pool?

The most important rule for eligibility into a lottery pool is being old enough to play. You only must be 18 years old to purchase a lottery ticket in the United States. Meeting that requirement means creating your own pool or joining one if you get invited. 

The majority of lottery pools are centered around employment. An office lottery pool can be an excellent way to promote a positive work culture and engage with more co-workers. 

It’s also reasonably easy to run an office lottery pool, as you’ll see the members multiple times throughout the workweek. 

Lottery pools aren’t exclusive to work, as any group can create a lottery pool. Family members, college students, neighbors, bowling teams, church groups, or just a collection of friends are all free to create a lottery pool as long as everyone is over 18. 

Are Lottery Pools Legal?

Forming a lottery pool can be considered a form of organized gambling. There are no federal laws that strictly prohibit gambling in the United States. 

However, individual states have been given the authority to determine the legality of gambling. Each state has differing views when it comes to gambling. It’s worth learning more about your state’s law before you take the first steps to create a lottery pool. 

The lottery is legal in 45 states, with Alabama, Alaska, Hawaii, Nevada, and Utah being the only exceptions. Generally, the states that permit their residents to play the lottery are tied with the concept of lottery pools. 

The states that don’t have the lottery are a little less lenient. Utah, for example, explicitly prohibits all games of chance. Participating in a lottery pool where someone buys tickets across state lines could result in criminal prosecution for breaking Utah law.

If you’re participating in an office pool, it might be a good idea to check your employee handbook or ask the HR department. 

The state might accept lottery pools, but employers can create employee codes of conduct. You might violate rules by gambling on company property or during work hours. If caught, you could face disciplinary action or potentially lose your job. 

You should especially be careful if you have a job working for the government. For example, federal employees are prohibited from creating lottery pools at work or on government-owned/leased properties. Active military members are also prohibited from playing the lottery or joining a pool that violates these guidelines. 

Have Lottery Pools Ever Won Before? 

Joining a lottery pool won’t dramatically increase your odds of winning the lottery. The chances of winning will still be overwhelming against you, no matter how many tickets you buy. However, someone has to match the number eventually, and there’s no reason it can’t be a collection of people. 

Here are a few examples of lottery pools that have won big money over the years: 

  • March 2011 (Albany, New York): A seven-person lottery pool formed in the Division of Housing and Community Renewal won $319 million playing the Mega Millions lottery.
  • June 2011 (Long Island, New York): A 20-person lottery pool of Costco workers won $201.9 million playing the Powerball lottery.
  • April 2012 (Philadelphia, Pennsylvania): A 48-person lottery pool formed at the Southeastern Pennsylvania Transportation Authority (SEPTA) won $107.5 million playing the Powerball lottery. 
  • October 2012 (Cedar Rapids, Iowa): A 20-person lottery pool formed at Quaker Oats won $241 million playing the Powerball lottery. 
  • February 2013 (Louisville, Kentucky): A 27-person lottery pool of IT workers at Humana, Inc. won $1 million playing the Powerball lottery. 
  • November 2014 (Oakbrook, Illinois): A 42-person lottery pool of ComEd workers won $1 million playing the Mega Millions lottery.
  • October 2015 (Yonkers, New York): A five-person lottery pool of friends won $106 million playing the Mega Millions lottery. 
  • August 2016 (Morgantown, West Virginia): A 26-person lottery pool of current and former West Virginia University employees won $1 million in the Mega Millions lottery. 
  • July 2018 (San Jose, California): An 11-person lottery pool formed at the San Jose Wells Fargo branch won $543 million playing the Mega Millions lottery. 
  • August 2018 (Chico, California): An 11-person lottery pool of current and former healthcare workers at Northern Valley Indian Health won $4.9 million in the Powerball lottery. 

What Are the Downsides of a Lottery Pool? 

The above instances prove that forming a lottery pool can make your financial dreams come true. However, it’s not always sunshine and rainbows when lottery pools hit it big. Hitting the lottery can often mean that greed and the ugly side of human nature emerge

There have been many cases of a lottery pool trying to cheat members out of winnings, buy tickets on the side, or play different numbers. 

These are a few examples of when lottery pools went wrong:

  • Alabama, 1999: A Waffle House waitress won a $10 million prize in a Florida lottery after a customer left five tickets as a tip to five employees. Her coworkers sued her when she claimed the award for herself and claimed they had agreed to split all winnings. The tipping customer also got involved with the lawsuit and claimed the five employees agreed to buy him a new truck if they won. The courts ruled in favor of the plaintiffs, stating that an oral contract was established. However, the ruling was deemed unenforceable as gambling was (and still is) illegal in Alabama. 
  • New Jersey, 2009: A construction worker won a Mega Millions prize worth $38.5 million during part of a lottery pool with five coworkers. Instead of telling the pool about the award, he requested extended time off from the job for “foot surgery.” The other members of the pool sued him when they discovered the truth. The court ruled in their favor, and they received close to $4 million each. 
  • Ohio, 2011: A man working for a cabinet company was actively participating in the lottery pool at his job. The lottery pool would win a $99 million prize while the man was out of work for three months with a back injury. He filed a lawsuit claiming that he deserved a portion of the winnings. The case was settled out of court for an undisclosed amount of money. 
  • Illinois, 2012: A pool of 12 people working at the Pita Pan Old World Bakery won $118 million playing the lottery. Shortly after, 11 coworkers claimed they were also a part of the lottery pool. The lawsuit would drag on for three years and feature six law firms. When the dust settled, the 12 people received nearly $6 million each, and six of the 11 coworkers would split $13.8 million.

Join a Pool of People That You Trust

It’s improbable that you’ll win the lottery. The odds aren’t in your favor, and there’s not much you can do about that. 

Joining a lottery pool can help to increase your odds slightly, but the difference likely won’t matter. Still, it can be an excellent way to play the lottery while keeping the expenses low. 

The key thing to any lottery pool is trust. There are few things worse than winning the lottery only to fight in court over your split. It’s even worse when the person or persons on the other side are coworkers, friends, or family members. 

Make sure you’re getting involved with people you trust if you’re looking to join a lottery pool or create your own. 

If you’re looking for a different way to get your lottery fix, try Yotta. Many users describe Yotta as a “no-lose lottery.”

You receive tickets based on the amount of money that you have in your account. The money will stay in your account whether you win or lose. You might not win a billion-dollar jackpot in the Yotta sweepstakes, but it’s impossible to beat a lottery with free entry. 

Visit Yotta today to make your first deposit and get started.

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