Imagine you've been playing poker for ages, and suddenly – you get your big break. After plenty of hard work, you win a humongous sum of money by playing Everygame poker, and your dreams finally come true!
We all crave for this scenario to play out in real life. But are you prepared for what comes next? Usually, poker players build their bankroll slowly but surely. However, winning a large amount of cash in a tournament or special poker event is not unheard of.
The question is, how do you react to the sudden appearance of thousands – if not hundreds of thousands – of dollars in your bank account? The risk of spending all your newly earned cash in a heartbeat is real, so be cautious.
If you've won a large sum of money while playing poker, let's take a look at what you should do to avoid making critical mistakes that will flush all your wins down the drain.
Tips on How NOT to Act After Winning Big in Poker
A lot of people tend to be impulsive with unexpected windfalls, going out and spending money on big purchases like a new car, booking a vacation, etc. And while buying something you have been dreaming of for a while sounds like a dream, financial experts recommend that you refrain from the following actions:
- Spending the money right away – A large sum of cash will burn a hole in your pocket, and you will immediately get the itch to spend it all right away. You should try to control these urges, as it takes time to figure out the best way for you to use the money. Putting it aside, investing it for a long period of time and so on might be less emotionally satisfying, but it will allow you to grow your wins even further.
- Also, spending everything all at once – As we've already mentioned, when getting a big win, people are automatically drawn to spending the cash on something they typically would have needed to save for. However, splurging and buying said item will lead to a short-lived satisfactory feeling, instead of looking at how you can enjoy the cash in the long run.
- Investing the money in the wrong things – Experts discourage you from financing anything that does not generate more revenue. Think about it, when will get another chance to invest so much in your future? If you invest your money instead of spending all of it, you will be able to have a brighter future ahead of you.
- Overlooking the matter of taxes – Another reason you shouldn't spend all of your wins straight away is the matter of taxes. Without figuring out what your tax exposure is for the additional cash you won you might find yourself unable to pay your tax bill. Please talk to a tax accountant to figure out how much cash to put aside for this specific purpose before making any further decisions.
- Changing overall spending habits – Many people who win big have the tendency to change their spending habits out of the belief that this new income will last indefinitely. A big win can make you feel like you're all set for the foreseeable future, but if you start spending more money than you are used to, you will find yourself back to square one sooner than you might think. You should treat the unexpected cash win as a one-time thing without accidentally going into debt or offsetting your normal spending.
Enjoy Your Win While Being Smart About It!
Yes, investing the money you've won is the smartest thing you can do. Put some of it aside, and invest some of it back into the game, but don't forget to enjoy your win as well!
You should definitely use a portion of your win to finance something you will thoroughly enjoy at the moment of purchase, as it is still important to remember that enjoying playing poker is what the game is all about.