The Financial Impact of Gambling Addiction
The psychological impact of compulsive gambling is always the most important thing. Your mental health is priceless, and putting it in danger due to gambling should not be an option. However, the financial consequences of problem gambling can be equally devastating, with knock-on effects on your health.
The main problems include:
1. Credit Card Debt
According to Debt.org, 90% of people suffering from a gambling addiction take cash advances on credit cards to fund their gambling. With high-interest charges and missed payments, these advances can cost a huge amount over time. As the gambling addiction takes hold and the compulsive gambler takes on more and more credit card debt, inevitably, they will suffer consequences that can include bankruptcy and homelessness.
Debt.org estimates that 23 million people in America alone are more than $55,000 in debt due to gambling, and numerous studies have proven the link between problem gambling and consumer debt.
2. Impact on Employment and Income
Compulsive gambling tends to wreak havoc on the individual’s personal and professional life. According to a study by the National Council on Problem Gambling (NCPG), about 40% of individuals with gambling problems miss work or lose productivity. This can result in job loss, reduced hours, or inability to focus at work, which adds to the mountain of psychological pressure.
The UK Gambling Commission estimates problem gambling costs the economy around $1.6 billion (£1.27 billion) annually thanks to lost productivity, absenteeism, and job loss. Compulsive gamblers can resort to desperate acts like theft or fraud as well, which can be career-ending events.
3. Bankruptcy and Financial Distress
In the US, a 2019 study from the Journal of Gambling Studies claimed gambling debts were responsible for up to 20% of individual bankruptcies. That’s a frightening number, and the UK’s Citizen’s Advice Bureau has revealed that 5% of people who seek help with debts said gambling was the main issue.
Unfortunately, by the time the individual reaches out for help, it’s never just gambling debts. Basic living expenses tend to be neglected, mortgages and rent payments are in arrears, and credit card debt can be out of control.
4. Unsecured Debt and Payday Loan Impact
The US Federal Trade Commission (FTC) reports that over 60% of individuals with gambling problems have significant amounts of unsecured debt with personal loans, payday loans, and friends and family.
In the UK, a study by the National Problem Gambling Clinic found that 20% of people asking for treatment for gambling issues had taken out payday loans. These are famous for their crippling interest rates that can trap the gambler in a cycle of debt that makes them chase a big win at the casino as the only solution – which makes things worse.
5. Impact on Families and Relationships
Gambling addiction doesn’t just hit the gambler hard. It can have a serious impact on their family and friends. The NCPG reports that approximately 60% of gamblers’ families deal with financial hardship due to their loved one’s addiction. Dealing with late payments, bills stacking up, and debt collectors at the door can have a devastating impact on family life.
In the UK, research by GamCare found that over 70% of individuals in therapy for gambling addiction cited significant strain in their relationships due to the financial repercussions of their gambling habits. Too many gamblers have lost their marriages, relationships, and families to their addiction.
6. Loss of Property and Homelessness
As gambling addiction intensifies, individuals often use their homes or other assets as collateral to secure more funds to feed their addiction. This can lead to foreclosures, loss of property, and eviction.
In the US, the Center for Responsible Gaming found that nearly 15% of gamblers have used their homes or property as collateral for gambling-related loans. This can result in financial devastation if the gambler fails to repay the loan or loses their property in foreclosure.
In the UK, research from GamCare highlights that around 13% of individuals seeking help for gambling addiction have lost their homes or faced eviction. This is often the result of borrowing money against their home, falling behind on mortgage payments, or failing to keep up with rent due to the financial strain caused by gambling.
Conclusion
Simply put, a serious gambling addiction can have a devastating effect on your life, and compulsive gamblers often find themselves in a mountain of debt. This can lead to rash decisions, desperate attempts to gamble themselves out of trouble, and serious financial and mental health consequences when reality catches up.
That’s why it’s essential to practise responsible gambling from the start and avoid letting it reach this stage.
