Can you buy lottery tickets with a credit card?

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You walk into a convenience store, choose your lottery ticket and prepare to pay for your purchase with a credit card. But there’s an issue: the cashier informs you that your credit card might as well be Monopoly money — she can’t accept it because of state law.

But why is this the case? It turns out there are a few reasons many states prohibit using your credit card for lottery ticket purchases. We’ll explore a few of the reasons some states outlaw credit card lottery purchases, and why even if your state allows it, you should think twice before swiping for a chance at riches.

What you need to know

The average U.S. millennial spends about $976 a year on lottery tickets. The allure of the lottery is understandable; for a few bucks, you have the chance to become wealthier. However, it’s hard for many people to understand just how small of a chance you have to actually win.

Here’s a little help to put your odds in perspective: You have a better chance of winning an Oscar than seeing the numbers on a televised lottery broadcast match your ticket numbers. Besides the terrible odds, you may be restricted to certain payment methods if you purchase a lottery ticket. There are a few factors that will determine whether you can use plastic to buy tickets for popular lotteries like Powerball or Mega Millions.

For example, there are about two dozen states that outright ban the use of credit cards to buy lottery tickets to prevent people from gambling with money they don’t have in their accounts. There are also six states that don’t sell lottery tickets because they don’t have state lotteries and don’t participate in multi-state lotteries: Alabama, Alaska, Hawaii, Mississippi, Nevada and Utah.

The following states do permit the use of credit cards to buy lottery tickets:

  • Arizona
  • California
  • Colorado
  • Delaware
  • Indiana
  • Idaho
  • Illinois
  • Kansas
  • Kentucky
  • Louisiana
  • Maine
  • Michigan
  • Missouri
  • Nebraska
  • New York
  • Ohio
  • Oregon
  • Rhode Island
  • South Dakota
  • Vermont
  • Washington

Although it’s not explicitly prohibited to buy lottery tickets with a credit card in these states, many state legislatures have complicated the matter. You can still be barred from purchasing lottery tickets if a specific merchant decides they don’t want to accept credit card payments for lottery tickets. For example, you can’t go out and buy lottery tickets with a credit card at Safeway. In fact, some retailers and states even prohibit debit cards for purchasing lotto tickets.

Why shouldn’t I buy lottery tickets with a credit card?

Can you buy lottery tickets with a credit card? Yes, with some restrictions regarding the state and store as mentioned above. The question to ask yourself is whether or not using credit is a responsible way to spend your money. Here are a few reasons why your money is better spent (or invested) elsewhere.

You might not earn rewards

Using a credit card for lottery tickets likely won’t yield rewards for many types of reward credit cards. This is because reward structures are usually based around points or cash back where gambling isn’t an earning category. You’ll need to check the terms and conditions of your specific credit card to find out whether you’ll earn points or not.

You’re taking on debt to finance gambling

It’s easy to get sucked into the promise of riches. But if you’re using a credit card to pay for a chance at winning the lottery, you’re adding to your overall debt load. If you buy multiple tickets regularly, your yearly costs can quickly snowball.

Better options exist elsewhere

Imagine if you instead invest the hundreds of dollars you spend each year on the lottery. Low-risk stocks where you can expect steady growth are a better financial strategy that may help grow your wealth. Or, you can put your money in a high-yield savings account. According to Bankrate data, only 18 percent of Americans have an emergency fund that’s fully topped up and 28 percent have no emergency savings. There are plenty of more prudent financial choices for you to make. Creating an emergency fund to help you cover living expenses during a medical crisis or to pay for a car repair is more practical than the purchase of lotto tickets.

The odds of winning are near nil

As much as we all hope to beat the odds, the chances of winning the lottery or even winning just enough to make your initial investment back are slim. You’re more likely to naturally have quintuplets than win the jackpot; five times more likely, to be exact. It’s not a financially savvy move to buy lottery tickets, but if you take your chances with those infinitesimal odds, make sure you don’t put it on your credit card.

The bottom line

While there are some states where you can buy lottery tickets with a credit card, it’s a good idea to avoid it. If you play the lotto even with these precautions in mind, pay in cash or with a debit card — and keep it to a rare expense instead of a daily or weekly habit.

With all the money you’ll save by not buying lottery tickets, you could go on a vacation or build a robust savings account to put toward other financial goals.