The most depressing place is a casino on a Tuesday afternoon. Old people in wheel chairs with oxygen tanks spending their retirement checks; broke people spending money they don’t have.
Any respectable degenerate town of two hundred years ago included a bar, a brothel, and a casino. Humans love to gamble.
It’s fun.
A small wager, a small chance to win big. Your heart races, your stomach turns, BAM! you win.
Or, you lose. Slowly, then quickly. You dump more and more of the money you worked hard for into the machine. You’ve got to get back even. You don’t. You feel sick, depressed.
It’s OK to gamble, a little.
If the money you lose is inconsequential to your net worth, there’s little harm. In the recent book The Wealth Ladder, the author offers a tool to decide whether or not to fret over a purchase decision. He calls it the 0.01% Rule. If a purchase is 0.01% or less of your net worth, buy it without worry. Calculate your net worth based only on cash and assets you can easily convert to cash such as stocks, bonds, and gold. Don’t include your home, retirement account, or private business ownership interests. If your liquid net worth is $100,000, buy without guilt anything $10 or less; if it’s $1 million, spend freely on purchases of $100 or less.
Should you choose to gamble, I offer the 1% Rule. Spend no more on gambling than 1% of your monthly after-tax income. With $5,000 in monthly after tax income, your gambling budget is $50. Doesn’t sound like much? Good. If you want to gamble $500, wait 10 months.
To gamble at all is a risk. You’re likely to spend more than you budget. The best option is to avoid casinos. If want to lose weight, don’t hang out in pastry shops.
I eliminate the likelihood of gambling over my budget with two strategies:
- Bring only the amount of cash I am willing to lose. Leave my debit card at home.
- Share the experience with my more responsible spouse who won’t let me spend more than my budget.
I play slots to observe myself and others react to winning and losing which improves my ability to sell products. I memorized perfect blackjack basic strategy and learned to count cards to train my mind and gain an edge over the house. I play poker to practice using probabilities to make uncertain decisions, a useful skill in business.
I think I just like to gamble.
The only way to not become a degenerate loser: a low budget.