Could a Savings Lottery be the Answer to Nevada Budget Woes?

Nevada has no state lottery. Bordering states including California have lotteries to help fund the education system. Nevada’s state constitution bans the creation of a lottery because it competes with business interests whom would lose money if residents gambled with the state instead of the corporations.

Now thanks to a great article and podcast by Stephen J. Dubner we can consider a new form of lottery for our state – a savings lottery.

The way such a lottery works is that instead of just sticking your money in a savings account, your savings account gives you chances to win all of the accumulated interest of all of the participants in the savings pool. You can withdraw all of your cash anytime you wish, you never risk your principal, yet for participating and collecting no interest on your funds you have a chance to win everyone’s interest.

The Washington Post wrote an article about a group of Credit Unions in Michigan who launched such a system in February 2010. Michigan? Come on if anyone loves to gamble Nevadans have them hands down loving gambling as a hobby! Check out the FrankenMuth Credit Union website to see their happy winners! Anything from just $15 to $100,000 won by individuals all for just saving their money!

South Africa has a Million a Month account which has transformed savings in that country. If Nevada had its own million a month account then it could attract depositors from across the country!

If all depositors are surrendering their interest earnings for the opportunity to win big money, give the state its cut of 5%, then after administration costs put the opportunity into the hands of anyone who makes a deposit in a state licensed institution.

A challenge to financial development is the deposit contribution made from a community to provide funding for loans on projects. As Las Vegas has projects that benefit many non-residents for the use of essentially the world a methodology that makes depositing your funds in a Nevada bank helps the economy. This is truly a win-win voluntary revenue source and economic development model.

I don’t have all of the answers but this is an option our state government should consider as a way to fund education. Our state should not be in competition with casinos for a lottery, yet in a savings lottery the corporations who benefit from increased community based savings have an opportunity to spur growth. How many of our visitors would help our longterm economy by throwing $100 in a savings account on their way out of town?

The infrastructure exists via our existing state network of credit unions to offer such a product to keep it entirely based within the state of Nevada.

Take a look to consider this voluntary funding method that helps promote the positive ideal of savings!

This entry was posted in Community Activism and tagged , , . Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s