The Solvency Shark recently overhead a conversation in which a woman recounted how she lost $1200 gambling in Biloxi (“which is a lot for me,” she said), and then made $1800 the next night. “So really, I won.”
This got the S.S. wondering: can you actually make money gambling in the long-term?
(Before we begin, understand that the answer is no. Nobody claims that setting foot in a casino is a productive way to manage your money!)
The reason people gamble in the first place (whether betting, playing the lottery or casino games) is the chance of a large payout. We hear stories about lottery winners, or see casino visitors toting buckets of tokens, and think, “that could be me!”
Odds are you won’t be, literally. Sure, big payouts happen from time to time. Like the woman in Biloxi, you could make money in the short-term (that is, if you gamble in just a few instances). But there are two big things going against you—
It’s really difficult to gamble “a little”. Have you ever heard of a person playing video poker “once or twice,” or popping into a casino “just for a few minutes”?
Gambling is intoxicating! It’s supposed to be. Those who run the games want to maximize your time playing. Which leads me to how:
The odds always benefit the house. The folks who designed gambling games weren’t imbeciles— if mega payouts were common, they’d be bankrupt in a matter of minutes.
Instead, each game of “chance” benefits the house after many repetitions. Their long-term payout is called the house edge, commonly known as the vigorish.
While a few games have tiny edges (blackjack yields only a 0.5% profit), most have “interest” rates that make credit card companies envious: roulette is around 5%, slot machines around 15%, and keno around 25%!
But can’t you beat the odds with strategy? Yes, but to a tiny degree, and mostly in the short-term. Long-term, the house still rules.
Well, you’re no fun. Sorry. Any money you plan to gamble, you might as well assume is already gone.
There’s a better way to grow your money, with greater possible payouts: investments.
Anyway: my name is Alexander Carl. I am a recent graduate of the University of North Carolina at Chapel Hill, where I spent four blissful years earning a degree in Communication Studies. Now I face the real world of economic downturns, student loans, and the absence of “academic” camaraderie.
Yet I refuse to be bummed. My economic philosophy is to live simply, save, and maximize whatever I can. Consumer culture is undeniably pervasive, but you don’t have to sell your soul to co-exist with it— there is great power from using your economic resources wisely.
I started writing when I figured out how to hold a pencil. Since then I’ve written short stories, poetry, screenplays, and have blogged. In fact, three of my screenplays have been produced into short films, two of which I directed. I’m no stranger to the media, having served as a DJ at a freeform radio station and worked as a crew member for live TV.
Pastimes include traveling (I’ll visit virtually anywhere), swimming, jogging, hiking, and hunkering down with a good movie.
Overall I’m a peaceful person, though not in a creepy New Agey way. I get my energy from music, good conversation, and the outdoors (I was an active Boy Scout, earning my Eagle). I consider myself “inquisitive” and “wry”, and for the sake of autobiography I’ll assume that I am.
- Summer Vacation On A Shoestring - May 12, 2014
- Can Gambling Make You Wealthy? - March 6, 2014
- Pointers for Avoiding Audits - February 8, 2014