How Does Gambling Affect My Credit Score?

While there is no direct connection between your credit score and gambling itself, the unfortunate truth is that your gambling habit can have an adverse affect on your credit score if it gets out of control. While you might currently have enough money in your bank account to justify a bit of time at the casino, if you’re using a payment method that is dependent on your credit score, like a credit card, you’ll be at risk of your score dropping.

For more information about your FICO Credit Score, read this.

Making A Bad Bet With Your Credit Score

Remember, having a lot of money in your savings account won’t necessarily guarantee you a high credit score. In fact, the status of your credit score and the status of your bank account are two separate notions. While a bad gambling habit is a problem in many other respects, not only will it drain your finances, but the long term effects it has on your credit score could hinder you further down the line. Even if you’ve managed to get your gambling under control, you could lose a lot of the benefits that would come with having a higher credit score.    

How Your Credit Rating Affects Your Life

An effective way of maintaining a favorable credit score is to make sure you always pay your credit card bill and loan payments on time and in full every month. Another unfortunate fact? Once your gambling habit starts causing you to default on your payments, not only will you get stuck in a cycle of revolving debt, but your credit score will drop and so will your credit rating. And once your rating drops, it can be challenging to get it back to where you want it to be.

After that, having a negative credit rating can impede you in two different ways. Firstly, you’ll have a harder time getting approved for loans, especially those used to finance more expensive purchases such as car leases and mortgages. On top of this, something that a lot of people fail to realize is that your likelihood of getting a good job will also diminish. In fact, no matter what age you might be, there are many employers out there that will pull your credit card history during a background inspection and will use it as a factor in determining how hireable you are.

Having Trouble Understanding Your Credit Report? Click here.

Gambling Habit + Low Credit Score = Bankruptcy

Activating numerous credit card accounts is something that a lot of gambling addicts will do to finance their habit. This is a surefire way to damage someone’s credit score, especially when they’re using one credit card to pay off another and high-interest charges are accumulated. Actually, you can be a compulsive gambler for quite some time before you really start to damage your finances and therefore your credit score. In other words, a compulsive gambler might see that they have a favorable score currently, use that to borrow money that they might not be able to pay back in the future, then only realize months later that their score has been damaged. Then, when their credit is ruined and their bank accounts are tapped out, they may have no choice but to declare bankruptcy.   

People Who Get Addicted to Gambling

Gambling, like any expensive habit, comes in ranges, from light-hearted fun to a serious addiction that needs constant fueling. For some, gambling is just an exciting rush when they go out for a night at the casino and play a couple of slot machines, maybe a round of blackjack. On the other hand, there are even more people who turn gambling into a way of life, feeding on the hope that one day they’ll win big. Actually, there are a few different types of people that make up the majority of the gambling population, including groups of the younger generation who gamble over the internet, like online poker players. In this case, using a credit card to pay for their bets is a requirement. Then there are the true gambling addicts, those who frequent casinos, race tracks, sports betting establishments, anywhere they can bet their money in the hopes of earning it back twofold. Someone like this might end up borrowing thousands of dollars, if not more, which can lead them down the slippery slope to financial ruin.     

Take a look at is infographic to see how your credit score is calculated.

What Is Casino Credit?

For all the casino goers who just like a bit of entertainment on occasion, there is a way to gamble that will have less of an impact on your credit rating: Casino Credit. Unlike what you would find with a credit card or a personal loan, the credit you can get through a casino is not sanctioned by any other company other than the establishment itself. You can create yourself a profile on site and be granted a credit account or “markers” that you can use for whatever game or slot machine you want. This way, you’ll have a set amount to gamble with and won’t have to carry any cash with you, kind of like having a self-addressed, post dated cheque. Just make sure to ask the casino staff about the timeframe within which you can use your credit.   

When Your Casino Credit Runs Out

It’s important, however, to be very cautious about how you’re using and paying off your casino credit. While it might be a somewhat less dangerous method of gambling, it works more or less the same way as another credit product does. For instance, the casino will have the right to review your credit report once you have applied for their credit. This could put a “hard inquiry” on your report, too many of which will subsequently damage your credit score. Then, just like a credit card, the casino will give you a certain period of time to pay off your debt or return your markers for cash back. If you fail to pay on time, you will be charged for it. The casino is even allowed to come after the money in your bank account like a collection agency would.  

Gambling Online Can Be Just As Hazardous as at the Casino

While online gambling can seem like less of an addiction than going to the casino every week, it can become just as much of a compulsion as any, the kind that can land you in serious debt. If this is the case, it’s best to realize you have this addiction and find someone to help you deal with it. True, this is not always an easy or realistic feat to accomplish, but it will work out better for your finances to at least try. In fact, most people can only force themselves to cease gambling once they’ve got nothing left to gamble with.

For more information on gambling addictions or if you need help with yours, go to the American Addiction Center’s website.