Unless you are professional gambler, playing any type gambling is a simple way to lose money.
There are so many ways to bet. I cannot even describe all of the ways. In fact, I am sure I don’t know all of the ways to make a bet. I have seen many financial planning books. However, I have never seen a financial planning book discuss the effect of gambling on a household’s ability to save for retirement. With the massive availability of places to gamble, this approach is incredible. Everyone in the world needs to understand that gambling can ruin your financial life and retirement.
In Connecticut, I remember when, many years ago, the lottery was the only “place to go.” Then we had a Jai Alai fronton, where people could go to watch games, and bet. Now, Connecticut has two huge casinos, Foxwoods Resort & Casino and Mohican Sun. Just to give you an idea, slot revenue at Foxwoods was $707 million for 2008-09 fiscal year.
According to the Nelson A Rockefeller Institute of Government Fiscal Studies dated June 23, 2011, 43 states operate lotteries, 15 allow commercial casinos, 12 have racinos, and over 40 states allow pari-mutuel wagering. In addition, according to an article of the Christian Science Monitor, dated December 26, 2011, the Department of Justice is changing its interpretation of the federal 1961 wire act, which should allow for online gambling. Instead of restricting gambling sites, we are getting more betting.
Since the states get a cut of the take at casinos, we can expect an expansion of legalized gambling. Connecticut gets a portion of the casino revenue from slot machines. Although the revenue has been declining, Connecticut, like many states, rely on this money for its operations.
In order to get control of your gambling spending, you need to treat this like any other expense. Track each dollar you spend for any and all gambling, including online gambling, poker and lottery tickets.
For many people, gambling is an addition. If you find that your gambling is out of control, you need to get help. The information for gamblers anonymous is below
PO Box 17173
Los Angelos, CA 90017
For people who are thinking about going to the casino, remember that the casino is set up so that people gamble and forget about their time and money. Notice that there is no outside windows and clocks inside the casino (somebody else made me aware of this). To combat these two tricks
- Limit the amount of money you can spend inside the casino – by only bringing cash on the trip. Never bring a credit card or debt card. The casinos want you to believe that they will conveniently take your debit card or credit card.
- Bring a watch with a time alarm, so you are prepared to leave at a set time. If you are losing, you limit your loss. If you are winning, you can cash out and take your winnings with you.
If one wants to look at an interesting study about the relationship between gambling and bankruptcy, go read Casino Gambling and Bankruptcy in New United States Casino Jurisdictions. (Journal of Socio-Economics 29 (2000) 247-261). The article argues that there seems to be a relationship between the location of gambling establishments and the level of bankruptcy filings. The article was written in 2000; since 2000, there are ever more outlets for gambling.
For anyone convinced that they can win at slots, go to “The Wizard of Odds” web page, which shows the slot machine odds in Vegas. The odds range from about 85% to 93%. Over the long term, the house wins 100%.
I have seen tax information from casinos showing a gambler’s winning at the casino, which need to be reported on a Form 1040 personal income tax return. In all of these cases, the gambler admitted that the winnings are gross, the losses are net. The losses exceed any winnings, and the losses are often $3, for every $1 won.
Nothing is worse than a family going together to the casino. What I will call this is the “family addiction.” The husband and wife go together, for a day out of fun. This is a fast way to home loss and bankruptcy.
Law Offices of Robert M. Singer, LLC
2572 Whitney Avenue
Hamden, CT 06518