Gambling with your loan money

Discuss various money matters here. Loans (federal and private), scholarships, lottery winnings, or other school finance related information and queries.
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jdubb990
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Gambling with your loan money

Postby jdubb990 » Sat Aug 14, 2010 12:18 am

Just wondering, who has done it? Horse races? Poker? Stocks? Money markets?

My fall and spring semester tuition and living expense money will be dispersed in a couple of weeks. I obviously don't need the spring tuition and a lot of the living expense money until next semester. I'd like to make some extra cash off of it. 3 month CD's seem the way to go, but the interest rates are so crappy. .8% compounded daily for instance. Any suggestions?

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skoobily doobily
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Re: Gambling with your loan money

Postby skoobily doobily » Sat Aug 14, 2010 12:19 am

Well, this is definitely illegal, and incredibly risky

Go for it!

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Jack Smirks
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Re: Gambling with your loan money

Postby Jack Smirks » Sat Aug 14, 2010 12:22 am

Playing the stock market can get pretty risky dude, I wouldn't want to gamble away my LS loan money on it. I'd definitely go with poker or horse races to be on the safe side.

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inchoate_con
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Re: Gambling with your loan money

Postby inchoate_con » Sat Aug 14, 2010 12:23 am

Money Market? Not much of a gamble.

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legalease9
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Re: Gambling with your loan money

Postby legalease9 » Sat Aug 14, 2010 12:52 am

Anything you don't need, pay back!!!

Consider every dollar you gamble as a dollar paid for entertainment. Nothing more...

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SwollenMonkey
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Re: Gambling with your loan money

Postby SwollenMonkey » Sat Aug 14, 2010 12:55 am

Not even I'd do this crap. I suck at gambling. However, the true worthwhile gamble is online poker or poker. This is what I hear, since poker is a game that can be mastered by studying rules.

CyLaw
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Re: Gambling with your loan money

Postby CyLaw » Sat Aug 14, 2010 1:02 am

Beyond this being a bad idea, I thought all federal loans are split so that disbursement happens once in the fall and once in the spring. Guess I was wrong on that.

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JazzOne
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Re: Gambling with your loan money

Postby JazzOne » Sat Aug 14, 2010 1:11 am

SwollenMonkey wrote:Not even I'd do this crap. I suck at gambling. However, the true worthwhile gamble is online poker or poker. This is what I hear, since poker is a game that can be mastered by studying rules.

The rules of poker are remarkably simple, so studying the rules won't help you master the game. OP, if you're not already good at poker, don't test it out with your loan money.

Also, at my LS, we get separate dispursements each semester.

merc280
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Re: Gambling with your loan money

Postby merc280 » Sat Aug 14, 2010 1:12 am

I heard online gambling is pretty easy to get hooked on and it has a good rate of return.

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OrdinarilySkilled
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Re: Gambling with your loan money

Postby OrdinarilySkilled » Sat Aug 14, 2010 1:15 am

merc280 wrote:I heard online gambling is pretty easy to get hooked on and it has a good rate of return.


You heard this from a fiend in denial.

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JazzOne
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Re: Gambling with your loan money

Postby JazzOne » Sat Aug 14, 2010 1:29 am

OrdinarilySkilled wrote:
merc280 wrote:I heard online gambling is pretty easy to get hooked on and it has a good rate of return.


You heard this from a fiend in denial.

You could be right but not necessarily so. I was hooked on internet poker for years, and I made a decent amount of money. I probably could have made more working a legitimate job, but making money at home with a beer in hand is hard to pass up.

lawschooliseasy
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Re: Gambling with your loan money

Postby lawschooliseasy » Sat Aug 14, 2010 1:39 am

inchoate_con wrote:Money Market? Not much of a gamble.


Yes. Not much of a gamble. That's why they pay about 3% interest. Interest on all government student loans other than subsidized Staffords is either 6.8% or 7.9%. Have fun.

EDIT: Also worth noting that the subprime crisis brought down several "riskless" money market funds.

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JazzOne
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Re: Gambling with your loan money

Postby JazzOne » Sat Aug 14, 2010 1:49 am

lawschooliseasy wrote:
inchoate_con wrote:Money Market? Not much of a gamble.


Yes. Not much of a gamble. That's why they pay about 3% interest. Interest on all government student loans other than subsidized Staffords is either 6.8% or 7.9%. Have fun.

EDIT: Also worth noting that the subprime crisis brought down several "riskless" money market funds.

Just for the record, the interest on student loans is deferred while you're in school. Your second point is interesting though. I thought money market accounts were FDIC insured?

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soaponarope
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Re: Gambling with your loan money

Postby soaponarope » Sat Aug 14, 2010 1:52 am

If you're going to gamble there are only 3 games you should play "." (in no particular order)

Poker is not one of them, unless you're Phil Ivey.

Roulette (European style). House odds are only 2.7% Safest bets are on black/red. American version house odds are at 5.2% (or something close to that) because they have more than one 0, i.e. 0, and a 00.

Craps. House odds are only a .1% however, its a complicated game, and in order to maximize your odds you need to know what the F you're doing.

Black Jack (my favorite). Assuming the house uses 8 decks, your odds are at .66% (the less decks the better for you, FYI). The norm though is 8 decks.

That said, the only way you can win at a Casino is playing with money to lose. Othewise, you'll be hesitant, and won't play the game correctly thus allowing the law of averages to work against you.

GL!

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northwood
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Re: Gambling with your loan money

Postby northwood » Sat Aug 14, 2010 2:00 am

dont be an idiot. as someone posted allready, you pay for the fun of losing your money. Money you gamble with should be considerded money you allready spent. If you lose there goes your tuition money. If you dont need the money, why take out a loan?? if you want to get some credit, open a credit card account, or get a small car loan. Those things generally cost less ( assuming you dont max out your credit cards, and only pay the minimum amount, or dont pay your cc bill, or car payment)

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soaponarope
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Re: Gambling with your loan money

Postby soaponarope » Sat Aug 14, 2010 2:12 am

northwood wrote:dont be an idiot. as someone posted allready, you pay for the fun of losing your money. Money you gamble with should be considerded money you allready spent. If you lose there goes your tuition money. If you dont need the money, why take out a loan?? if you want to get some credit, open a credit card account, or get a small car loan. Those things generally cost less ( assuming you dont max out your credit cards, and only pay the minimum amount, or dont pay your cc bill, or car payment)



Credit cards NEVER, and I mean, NEVER, offer interest rates comparable to an unsubsidized Stafford loan, or even a Grad Plus loan. That said, kid doesn't want CREDIT, he wants to win $$$$$ with his excess loan money, and pay back whatever he owes. Risky, but would be f'kn awesome if he pulled it off.

hawkeye22
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Re: Gambling with your loan money

Postby hawkeye22 » Sat Aug 14, 2010 2:14 am

JazzOne wrote:
lawschooliseasy wrote:
inchoate_con wrote:Money Market? Not much of a gamble.


Yes. Not much of a gamble. That's why they pay about 3% interest. Interest on all government student loans other than subsidized Staffords is either 6.8% or 7.9%. Have fun.

EDIT: Also worth noting that the subprime crisis brought down several "riskless" money market funds.

Just for the record, the interest on student loans is deferred while you're in school.


FALSE Only on the subsidized Staffords. Interest starts compounding on the others the day you get the cash.

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OrdinarilySkilled
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Re: Gambling with your loan money

Postby OrdinarilySkilled » Sat Aug 14, 2010 2:25 am

northwood wrote:dont be an idiot. as someone posted allready, you pay for the fun of losing your money. Money you gamble with should be considerded money you allready spent. If you lose there goes your tuition money. If you dont need the money, why take out a loan?? if you want to get some credit, open a credit card account, or get a small car loan. Those things generally cost less ( assuming you dont max out your credit cards, and only pay the minimum amount, or dont pay your cc bill, or car payment)


This is untrue and unfun. Money you gamble is invested in odds. If I buy a lamp, I spent the money. If I bet the Charlotte Bobcats win total over, I have invested in a basketball team. Someone else holds it, but when I win, they give it back to me + cheez. Let's see a lamp do that. Also I have a gambling problem.

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soaponarope
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Re: Gambling with your loan money

Postby soaponarope » Sat Aug 14, 2010 2:29 am

OrdinarilySkilled wrote:
northwood wrote:dont be an idiot. as someone posted allready, you pay for the fun of losing your money. Money you gamble with should be considerded money you allready spent. If you lose there goes your tuition money. If you dont need the money, why take out a loan?? if you want to get some credit, open a credit card account, or get a small car loan. Those things generally cost less ( assuming you dont max out your credit cards, and only pay the minimum amount, or dont pay your cc bill, or car payment)


This is untrue and unfun. Money you gamble is invested in odds. If I buy a lamp, I spent the money. If I bet the Charlotte Bobcats win total over, I have invested in a basketball team. Someone else holds it, but when I win, they give it back to me + cheez. Let's see a lamp do that. Also I have a gambling problem.



Well... you could buy a lamp from an aspiring artist "hoping" that it would be worth something at a later date... somewhat analogous to a gamble :P

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OrdinarilySkilled
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Re: Gambling with your loan money

Postby OrdinarilySkilled » Sat Aug 14, 2010 2:38 am

soaponarope wrote:
OrdinarilySkilled wrote:
northwood wrote:dont be an idiot. as someone posted allready, you pay for the fun of losing your money. Money you gamble with should be considerded money you allready spent. If you lose there goes your tuition money. If you dont need the money, why take out a loan?? if you want to get some credit, open a credit card account, or get a small car loan. Those things generally cost less ( assuming you dont max out your credit cards, and only pay the minimum amount, or dont pay your cc bill, or car payment)


This is untrue and unfun. Money you gamble is invested in odds. If I buy a lamp, I spent the money. If I bet the Charlotte Bobcats win total over, I have invested in a basketball team. Someone else holds it, but when I win, they give it back to me + cheez. Let's see a lamp do that. Also I have a gambling problem.


Well... you could buy a lamp from an aspiring artist "hoping" that it would be worth something at a later date... somewhat analogous to a gamble :P


Nah thats more of a "pure" investment, rather then one based on a specific outcome. It's kinda like paying 150K for knowledge and a piece of paper in hopes of increasing your value such that you will make more money than you could have. Now i'm depressed.

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PhantaManta
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Re: Gambling with your loan money

Postby PhantaManta » Sat Aug 14, 2010 3:02 am

If you do do this, I wouldn't post it on TLS or anywhere else for that matter.

1. Do not try this with any form of gambling other than poker,
2. Do not try this with poker unless you are a winning player over 50,000 hands minimum (probably need more, but w/e).

I do not plan to do this with any my living expenses money, even though you can see I am attending UNLV. With that said, if you set aside separate funds that you have previously saved up prior to law school and don't start dipping into your living expenses money, it is certainly possible to make money that saves you from paying back a little bit in the long run.

yourdreamtheater
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Re: Gambling with your loan money

Postby yourdreamtheater » Sat Aug 14, 2010 4:07 am

Prop trader here --

I don't care about the other suggestions, but DO NOT invest in stocks or money market accounts. Judging from the fact that you lumped "horse racing" and "stocks" together, you don't seem to have a clue what you're doing. There's a reason that so many bulge bracket banks are having record years in trading year after year -- they prey on people like you.

Not sure about the legality of it, but a bond would be the way to go. I'm guessing you wouldn't be trading bonds -- you'd be taking in the interest payments, correct?

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JazzOne
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Re: Gambling with your loan money

Postby JazzOne » Sat Aug 14, 2010 9:40 am

hawkeye22 wrote:
JazzOne wrote:
lawschooliseasy wrote:
inchoate_con wrote:Money Market? Not much of a gamble.


Yes. Not much of a gamble. That's why they pay about 3% interest. Interest on all government student loans other than subsidized Staffords is either 6.8% or 7.9%. Have fun.

EDIT: Also worth noting that the subprime crisis brought down several "riskless" money market funds.

Just for the record, the interest on student loans is deferred while you're in school.


FALSE Only on the subsidized Staffords. Interest starts compounding on the others the day you get the cash.

You are correct. I forgot about the unsubsidized loans. Scholarships FTW.

RPK34
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Re: Gambling with your loan money

Postby RPK34 » Sat Aug 14, 2010 9:48 am

It's not gambling if you know you're gonna win

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OGR3
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Re: Gambling with your loan money

Postby OGR3 » Sat Aug 14, 2010 10:33 am

I know a guy who can turn $1,000 into $3,000 in only a month! Send me your loan check and you'll be loaded by the beginning of next semester...




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