Leave the Credit Cards at Home

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Almost 70 years ago, Harold's Club casino owner Pappy Smith had little signs made that said:

Don't Bet More Than You Can Afford To Lose

That was good advice! Today, most people have access to a credit card or two for their gambling adventures, but that can be a very expensive choice! The casinos have a house edge on all of the games except for certain video poker games, card counting in blackjack and live poker.

We refer to casino games as having a negative expectation. This means that over the long run the mathematics of the game will grind away at your bankroll.

The built-in house advantage is how the casinos make money. Certain games have a lower house edge than others. Video Poker, Blackjack and the Pass Line bet in Craps have a low house edge. Roulette and slots have a higher house advantage. It is the price we pay to play. It's the cost of entertainment. Proper money management tells us to budget a given amount to gamble with and stick to that amount, win lose or draw.

NEVER GAMBLE WITH BORROWED MONEY

If you run out of money and decide to take a cash advance on your credit card at the casino, you are gambling with borrowed money. There are also hidden charges you may over look if you decide to do this. Just using an ATM is likely to cost you $3, but that's nothing compared to using a no-pin number service to get cash on your credit card.

Fees start at about $21.99 for a $500 advance. That is 4.4-percent paid to the casino up front. On top of that, your credit card company is likely to charge you a fee of 3-percent for the entire $521.99 you are borrowing. Yup, that's another $15.66 so, now you have paid almost $40 to get a loan, and if you don't pay it all off at the next statement date you'll pay interest until you do!

Credit card debt is the financial ruin of many people these days. It is too easy to get caught up in the “Buy now Pay Later" mentality. The chart below will hopefully put things in perspective. Every one of us should hesitate the next time we reach for Plastic to make a purchase.

I know that you need to take a credit card with you when you travel to obtain hotel and car reservations but they should not be used for frivolous cash advances. Cash advances should be used for “Dire Emergencies” only, and more hands of blackjack or more pulls on the slot machine handle falls into this category.

Quitting a game of cards or leaving a slot machine while you are losing is tough. There are a lot of psychological issues that go with gambling, and losing.and not knowing when to quit is one of them. Do yourself a favor by accepting that gambling is entertainment. Gamble, enjoy, leave at a predetermined time or at a specific dollar loss that you have set in advance. Forget the credit card advance, or you may wind up paying for years on a few extra hours of play!

Credit Card Repayment

Monthly PaymentsTime# of paymentsTotal Amount Repaid
$49.741 year12$596.88
$27.332 year24$655.92
$19.963 years36$718.56
$16.344 years48$784.32
$14.235 years60$853.80