Powerball is an American lottery run by the Multi-State Lottery Association that is played in 44 states. The game is exceedingly simple, yet highly lucrative. In fact, as of May 2013, the Powerball lottery has held the world record for the highest jackpot (before taxes) awarded to a single person ($590 million). Though any one ticket's probability of winning the jackpot is tremendously low, as the old saying goes, "You've got to be in it to win it."
1. Get a ticket. Single Powerball tickets cost $2 a piece. In every state except California, you also have the option to play “Power Play”. Power Play is an add-on to the ticket price that increases your winnings for all non-jackpot prizes should you win. As of January 2014, prizes for winning tickets with the Power Play add-on are subject to a 2x, 3x, 4x, or 5x multiplier, selected at random before each drawing. For instance, a $4 prize would become either $8, $12, $16, or $20 with Power Play. This option costs $1 extra.
The Power Play option is unavailable in California because state laws require that lottery prizes be paid on a pari-mutuel basis. This means that lottery prizes can't be set at absolute values, but must fluctuate based on the number of tickets sold and the amount of winning tickets.
2. Fill out your ticket. Though Powerball tickets will vary slightly from state to state, the basic method for filling a ticket out is the same everywhere. On your ticket, you'll need to specify the numbers you want to bet on, the number of drawings you want, and whether or not you want the Power Play option. Follow the guidelines below for filling out a basic ticket:
Fill in the spaces for five numbers from 1-69 and one number from 1-26. Usually, Powerball tickets are divided into multiple sections called "boards" which have rows of multiple-choice style bubbles to fill in to choose your numbers. Each board essentially counts as one $2 ticket. In other words, for $2, you can fill out one board on the ticket and bet on a single set of numbers. Each subsequent board filled out costs $2 more but allows you to bet on an additional set of numbers.
Indicate for each board whether you'd like the "Power Play" option. Each board (except in California) should have a space that allows you to buy a Power Play for your set of numbers.
For random numbers, fill in the QP space instead of your numbers. "QP" stands for "Quick Pick" - this lets a computer randomly choose numbers for you.
Choose how many drawings you want. Most tickets have a "Multidraw" section that allows you to pay for multiple drawings. For instance, if you want to bet on your numbers for two back-to-back drawings, fill in the "2" space. Each subsequent drawing costs as much as an additional ticket.
If you make an error on any board, fill in the "VOID" space for that board. Don't try to erase - instead, mark the board void and fill your numbers in on another board.
When you're finished, pay for your ticket. The clerk will calculate the price of your ticket based on how many boards and Power Plays you've selected.
For example, if we play 5 draws on one board with a Power Play and 5 without, we would pay 5 × 3 + 5 × 2 = $25.
3. Alternatively, ask the clerk for a Quick Pick ticket. If you don't wish to fill out a lengthy Powerball ticket by hand or you don't care which numbers you bet on, you can usually ask for a Quick Pick ticket instead of the normal Powerball ticket. In this case, a computer will randomly choose your numbers for you as if you had filled in the "QP" space for a board on the normal ticket.
4. If you win, collect your winnings. Small prizes can be claimed directly from the vendor you bought the ticket from, while larger prizes require official verification. If your winnings are less than $600, simply go to the lottery retailer with your ticket to claim your winnings. If your winnings are over $600, go to a lottery district office to present your ticket. The precise procedures for claiming large prizes differ from state to state - you may need to fill out a claim form, etc.
Powerball tickets do expire. The time window you have to claim a prize differs from state to state - from 90 days to a full year.
If you can't make it to the vendor or lottery office for some reason (for instance, if you've left the state you bought the ticket in), it's legal to mail your ticket to the state lottery office.
Powerball provides a map that links you to state lottery pages, which will have more specific information about claiming prizes in your state. Access the Powerball Map to find any of these locations.
5. For jackpot prizes, choose a payout option. Congratulations, you won the jackpot! The only question remaining before you retire is this: how would you like your money? Powerball jackpot winners have two options for receiving their cash - they can receive the entire prize at once in a lump sum, or they can receive it as an annuity - in other words, in yearly installments. Choosing which prize to take is a complicated decision that will differ based on your personal financial situation. Taking the cash as a lump sum will give you lots of money up front, so it may be a good idea if you have a dream purchase or investment you'd like to make immediately. The annuity option invests the cash winnings, gives you your first installment immediately, then gives subsequent payments each year for 30 years (plus interest), which is a better situation for long-term stability.
Note that Powerball winnings are subject to federal and/or state income taxes. Because of this, the annuity option will net you more money in the long term - not only will you receive interest on your winnings, but each year you'll only have to pay taxes on about 1/30th of your total prize, meaning more of your prize will be taxed at a lower bracket. On the other hand, with a large lump sum payment, you can expect to pay up to about half of your winnings in taxes, depending on your state's income tax rules.
6. Understand Powerball odds. Like any lottery, Powerball's jackpot odds are very slim. Many avid Powerball players consider the excitement of going against the odds to be part of the fun. To make an educated decision when buying Powerball tickets, consult the official odds listed below, which are for a single random $2 ticket:
Matching only the red ball: 1 in 38.32
Matching the red ball and one white ball: 1 in 91.98
Matching the red ball and two white balls: 1 in 701.33
Matching three white balls: 1 in 579.76
Matching the red ball and three white balls: 1 in 14,494.11
Matching four white balls: 1 in 36,525.17
Matching the red ball and four white balls: 1 in 913,129.18
Matching five white balls: 1 in 11,688,053.52
Matching the red ball and five white balls: 1 in 292,201,338.00
Overall odds of winning any prize at all: 1 in 24.87