5 Steps to Get Gambling Debt Relief

Here’s what you need to know about getting relief from gambling debt.
6 minute read | 6/9/19June 9, 2019
Man adding his chips to the pot in a poker game

Gambling can be a way to relieve stress and enjoy an evening’s entertainment. However, for some folks, it can become a problem. About two million people in the United States meet the criteria for pathological gaming, while another four to six million are considered problem gamers, according to the National Council on Problem Gambling.

Even if you’re not addicted to gambling, the reality is that gaming debts can add up quick — and threaten your financial health. If you’re drowning in debt, here are some of the things you can do to move forward and get gambling debt relief.

5 tips to get gambling debt relief

For the most part, figuring out how to recover from gambling debt is similar to approaching other debt problems.

1. Acknowledge that you have a problem

The first step to moving forward is acknowledging that you might have a problem. According to the American Psychiatric Association (APA), “[L]ike alcohol, tobacco or drugs of abuse, gambling can become an addiction. … Any gambling behavior that creates harm, distress and negative life problems could be a sign of a gambling disorder.”

If you feel like you have to lie to people in your life about how much you gamble or if you feel the need to keep betting more money to eventually come out ahead, these could be signs of a problem, says the APA.

Learn more about getting help for a gambling issue by visiting the National Council on Problem Gambling or by finding a meeting of Gamblers Anonymous.

2. Stop adding to your debt

It’s important to quit running up gaming debts as soon as possible — and getting help can help you stop adding to your debt. Talk to friends and loved ones for support through the process, or use an organization to help you work through problematic behaviors. Both can help hold you accountable and encourage you to stop adding to the debt.

Consider replacing gambling with another activity. There are other ways to find entertainment with your loved ones, including outdoor activities, movies, and developing a new hobby. Focus on filling your life with other activities — especially things you can do with loved ones — that can help support you as you get professional help.

3. Figure out what you owe

Next, add up what you owe. Just as you would with any other debt payoff plan, it’s important to know where you stand. List all your loans, along with their total amounts, monthly payments, and interest rates. In many cases, you might discover that you’ve used a combination of personal loans, credit cards, or other types of borrowing to build up gambling debt.

It can be daunting to look at the list of debts, but the reality is that you need to know what you’re facing before you move forward.

4. Consider your options for getting the money

Now that you know where you stand, it’s time to consider your options for getting the money to pay the debt off. Raising money for gambling debt relief could help you move forward. Consider some of the following ways to earn extra money to pay down your debt:

  • Cut your monthly expenses: Review your income and expenses. Are there areas where you can reduce what you pay on services or products? If you cut out the unnecessary spending, you can redirect some of that money toward paying down gambling debt.
  • Sell unused items: Consider selling some of the things you no longer use. You can sell using local classifieds, Craigslist, or eBay. This money can be applied to your debts.
  • Get a second job: Perhaps you need more money than what you can get by reducing your spending and selling your stuff. A second job can help you earn more cash to pay off your debts; once you’ve gotten rid of the debt, you can quit the job.
  • Use the sharing economy: If getting a second job isn’t the right move for you, the sharing economy might help. You can rent out a room in your home using Airbnb or consider driving for Uber or Lyft on your own schedule. With the sharing economy, you have a little more flexibility in how you earn more money.
  • 401(k) loan: This might not be the best option, since it takes some of your money out of the market. However, if you have the ability, you might be able to take out money to pay off your gambling debts. The interest you pay goes back into your 401(k). However, realize you could be penalized and taxed if you don’t repay the loan as required.
  • Home equity loan: Your home is likely your most valuable asset. You can usually get a reasonable interest rate with a home equity loan. However, you take on a big risk — you could lose your home if you don’t make your payments.

Carefully think about what moves will be helpful in reducing your debt and helping you get back on your feet. With a combination of strategies, you might be able to recover from your gambling debt faster.

5. If you can’t repay, look to relief programs

For some, the debt might be too much to handle without a more substantial gambling debt relief plan. Here are some of the debt relief solutions that might help you overcome your gambling debt and move forward with your finances and your life:

  • Debt consolidation: If you have good credit, you might be able to get an unsecured debt consolidation loan that can help you pay off your gambling debt. Such a loan would help you get everything in one place, with one payment and a (hopefully) lower interest rate.
  • Debt management: You can get debt management help by going through the National Foundation for Credit Counseling (NFCC) and finding someone near you. A reputable NFCC agency can help you create a debt management plan and even help you come up with a payment strategy that fits your budget.
  • Debt settlement: With debt settlement, your creditor allows you to pay less than the total amount you owe on the debt. In some cases, this requires you to make a lump sum payment. There are companies that can help you manage the debt settlement process, but you have to watch out for scams. Also, debt settlement often negatively impacts your credit score. Carefully consider debt settlement companies before you move forward.
  • Negotiate a payment plan: You can also go to your creditors and ask them to help you come up with a payment plan. You might be able to better manage your monthly cash flow with a payment plan, and in some cases, you might get a lower interest rate and be able to pay off your debt faster with a payment plan.
  • Bankruptcy: For most people, bankruptcy is the option of last resort. However, if your gambling debt is so overwhelming that nothing else appears to be a workable solution, it might make sense to use bankruptcy. Be aware, though, that your creditors may fight the proceeding in the case of gambling. Some lawyers recommend you wait until your last gambling debt is at least 90 days old before you file.

    Additionally, you might not have your debt discharged if the creditor can prove you had no intention of repaying the debt when you assumed it. And, of course, the impact on your credit is long-lasting in the case of bankruptcy.

Gambling debt relief is dealt with much like any other unsecured debt you might have, so it’s important to pay attention to your options and figure out which scenario is likely to work best in your situation.

Bottom line

In the end, your gambling debt isn’t likely to be treated much different from any other debt you have. Understanding that you might have a gambling problem and then getting help to quit the behavior are the first steps to moving forward. Once you’ve done that, you can look at your options for paying off your debt and getting gambling debt relief.

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