Winning in poker is not always guaranteed, but when it does happen you can really hit the jackpot and take home hundreds of dollars, if not more. Some professional poker players win millions of dollars at tournaments, and although not all of us are this fortunate, it pays to know how to spend your poker winnings.
It can be tempting to spend it all on luxury goods and lavish holidays, but when you unexpectedly come into money you should also know how to spend it wisely while also treating yourself.
1. Investing
Investing is never a bad idea as it allows you to passively grow your wealth, especially if you enlist the help of a financial advisor.
Stocks are easy investment options, as you can choose whether you want to invest in a company’s stocks or in exchange-traded funds (EFTs). Individual stocks can be riskier, but they offer higher returns if you choose revenue-generating companies. EFTs are lower risk and more diverse.
Mutual funds are also a good option for novice investors. These funds pool all the investors’ money to invest in various stocks, bonds, and other assets.
Investing in metals like gold or silver can help you hedge against inflation and economic fluctuations. Metals won’t grow like stocks or other assets, but they offer a secure investment for your funds.
2. Create an Emergency Fund
Saving for rainy days when you come into money is always a good idea. An emergency fund can act as a safety net when you have unexpected expenses like having to fix your car, replace your refrigerator, or cover medical bills.
Your emergency fund should cover at least three to six months; expenses. Of course, your poker winnings may not be enough for the fund, but contributing winnings frequently will help you grow your savings. If you happen to play at an online casino, opt for a casino fast withdrawal platform that provides instant access to your winnings. These types of platforms allow you to receive your poker winnings within minutes, and you can add money to your emergency fund immediately without being tempted to spend it.
It is recommended that you save your money in a high-yield savings account where you can access it in a pinch.
3. Tick Off A Bucket List Item
Do you have any bucket list items that you want to achieve, see, or experience? You can put your poker winnings towards it to finally achieve this goal. Go skydiving, visit the Vegas Strip, or head over to Disney World. These activities may be pricey, but you have the money and the memories you create will be worth the expenses.
4. Pay Off Debts
Paying off your existing debts should be a no-brainer when you come into some extra cash. There are two recommended ways to pay off debts:
- Avalanche method: Start with your largest debts first and constantly chip away at it until it is repaid, then work on smaller debts.
- Snowball method: Start with your smaller debts first to repay them all, reducing your interest payments, before you start on your large debts.
The method is up to you, but the sooner you get started on repaying debts, the better it is for your finances.
5. Upgrade Your Hardware
New technology isn’t cheap, so why not use your poker winnings to upgrade your phone, headphones, speakers, laptop, or gaming console? Frivolous expenses are rarely a good idea, but having some spare cash from playing poker can be just what you need to validate a techy purchase.
If you get a better smartphone or faster PC, you can consider it an investment into your poker playing as these devices can deliver better online gambling experiences.
6. Plan For Future Poker Games
The more money you have, the bigger buy-ins you can afford, the more money you stand to win. When you do have a good hand and win a game, set some of the winnings aside for future games. That way you don’t have to dip into your living expenses to enjoy a round of poker or enter a tournament with a costly buy-in.
7. Discover A New Hobby
Starting a new hobby or learning a new skill is not only daunting, but many people often don’t have the funds to get started. Although not all hobbies require a significant capital investment to get started, most do. This includes purchasing books, an online course, or the tools you need for the hobby, like a musical instrument, knitting needles, or a camera for photography.
8. Start Saving For Retirement
Saving for retirement is as important as investing, but it can be tough to get started if you have a lot of other expenses for daily life.
But, poker winnings can boost your income, and you can use the money to invest in a Retirement Savings Plan or a Tax-Free Retirement Account. Not only will you reduce your taxable income, but you will also contribute tax-free to your retirement.
Wrapping Up
Winning at poker is incredibly exciting, but you need to know how to keep your money secure. It is tempting, and reasonable, to spend some of your winnings on yourself by buying something you’ve always wanted or booking a dream holiday.
However, it is also important to set some of your winnings aside for the future, either as investments, a retirement fund, or emergency expenses. You can use your winnings for fun as well as your future, as long as you strike a balance.