I realize that talking about teaching kids about gambling may be a little bit controversial. But if you think it’s a bad idea, I ask that you keep an open mind while I tell you the benefits. You can always decide that I’m an idiot after you finish the page, but you might just learn a few things too.
The most important reason I think teaching kids about gambling is to protect them. This might sound crazy, but I explain why in the first section. In the sections after that you can learn practical ways that gambling knowledge helps kids throughout their life.
As children grow up, their brains are like sponges, soaking up information right and left. They can learn more than adults and most of them have an intense curiosity about why things are the way they are and how things work.
Children are also prone to manipulation from reverse psychology. You tell them they can’t do something, and they want to do it. If they don’t do it, they want to know exactly why they can’t and it needs to make sense to them.
Kids are told they can’t drink when they’re growing up. So when they get away from home they want to see what they’ve been missing. So, many of them drink to try it out. But in cultures where drinking is less restricted, like in France, the children don’t feel like it’s something that’s been kept from them.
I’m not supporting giving your kids something that harms them. But what I am suggesting is introducing them to gambling when you have some influence about how they view it and how they react to it. Just like some people who drink have a problem; some people who start gambling can’t stop and it ruins their lives.
When most people gamble they get a psychological rush when they win. The body starts to desire this rush more and more, which can lead to gambling addiction. You can learn more about this here.
But you can train your mind and body to control the rush if you know what you need to do. Of course, most people who gamble don’t let the rush take over, and can gamble when they want and not gamble when they need to stop. But denying the possibility of a problem isn’t the answer.
The point I’m trying to make is that a great deal of how kids look at things when they grow up comes directly from the way they’re taught when they’re young.
You can teach your kids that gambling is a form of entertainment and that you only do it with extra money set aside for entertainment purposes. If they learn that you never gamble with money you can’t afford to lose, it can instill this important lesson in them for life.
We try to protect children from dangers, but sometimes the act of protecting them by trying to keep them from doing something has the opposite outcome. This process can actually push them toward it, rather than keeping them away from it.
Of course, it’s important to recognize why you gamble before trying to teach your kids. Kids that grow up with parents who smoke are more likely to smoke when they grow up. Kids that grow up with parents who drink too much are more likely to drink too much when they grow up. If you have a gambling problem, your kids have a higher chance to have a gambling problem when they grow up.
Make sure you’re teaching your kids to be responsible like you, instead of telling them to do what you say and not what you do.
Risk verses Reward
One of the most important things to learn, especially in business, is the balance of risk verses reward. Risk verses reward also comes into play in many important life decisions. When you gamble, you risk a set amount, and you either lose part or all of it, or win. To see how risk verses reward varies depending on the situation, here are a few examples.
|Betting on black at roulette||High||High|
|Investing in a CD||Low||Low|
|Investing in an index fund||Low / Medium||Low / Medium|
|Buying penny stocks||Very High||Very High|
Looking at these four possibilities, which is the best option? The truth is that there isn’t one best option. It depends on your goals, how easy it is to replace your investment, and how much risk you’re willing to take.
When you bet on black at the roulette wheel, you’re making an all or nothing bet. If you bet $100, you either win $100 or lose $100. This seems fairly simple, but the truth is that most people don’t make a single bet. So you have to look at the long term value, and most casino games have a house edge that slowly takes your money.
You can go to the bank and invest in a certificate of deposit, or CD. This is one of the safest investments you can make, but it also offers a low return.
When you invest in an index fund, your investment is usually fairly safe, but it can lose value. The reward can be low to medium, but you usually need a big investment to make a big return with index funds.
Buying penny stocks offers a small chance to make a huge return on your investment, but you also have a huge chance to lose all of your money.
You can use this example to teach your kids about risk verses reward. I’m not telling you which choice is best, because what’s best for me might not be what’s best for you. But when you teach kids about risk verses reward it gives them tools they can use the rest of their life.
Good and Bad Gambles
It’s difficult to determine exactly what constitutes a good and bad gamble, but you can use some fairly simple math to make some educated guesses. Building math skills is covered more in the next section, but you need to use a few when looking at good and bad gambles.
If you jump off a cliff with a 100 foot drop, what are your chances to live? I don’t know for sure, but it doesn’t matter. You’re likely to die, so it’s a bad gamble.
What if someone offered you a million to jump off the cliff, but you only get it if you survive? The money doesn’t really change the fact that it’s a bad gamble, because you’re still likely to die.
Now let’s look at some realistic financial examples:
If you could bet $100 and have a 47.36% chance to win $100, and a 52.64% chance to lose your $100, is it a good or bad gamble? It doesn’t seem quite fair, because if the bet offered fair odds you’d have a 50% chance to win. If you decide this is a bad gamble, then you shouldn’t play roulette. This example uses the exact percentages that a double zero roulette wheel provides.
What if the chance to win was increased to 48.65%, leaving the chance to lose at 51.35%? That’s closer to fair, but if you keep making this bet you eventually lose money. This is the chance to win an even money bet on a single zero roulette wheel.
If you teach your kids how the math works in the casino, they can learn that gambling is not something they should do unless they have extra money they’re willing to lose. I’m not against gambling and I didn’t teach my kids not to gamble. But I did try to teach them the realistic expectations of gambling. I also taught them how to look for an edge, and to never gable with money they weren’t willing to lose.
I believe that the more information you have about anything, the better your decision making is. So instead of trying to hide information about gambling from kids, you can control the information and give them the information they need to make smart decisions in the future.
Build Math Skills
Other than arming kids with as much information as possible so they can make good decisions, learning about gambling is valuable in building math skills. If a child can learn how math works in gambling, they can handle just about anything math related in the rest of their life.
Blackjack is a simple game to learn that teaches kids how to quickly add numbers 1 to 11. It also teaches them how to use a variable when making decisions. Aces can be used as 1 or 11, and the goal is to get close to a total of 21 without going over.
You can use roulette to teach kids how odds work, and even use multiple roulette bets to help them learn about fractions.
Video poker machines are 100% based on fairly simple mathematical principles. You can use the pay tables and strategy charts to show why one decision is better than another based on the math.
Here’s an example:
You’re playing Jacks or Better and have a pair of jacks, a 10, nine, and eight. You can either keep the pair of jacks or keep the four to an open end straight. It’s easy to use the pay table and your chances on each hand to determine if it’s better to keep the par of jacks or draw to an open end straight.
The easy way to run the numbers is to consider every possibility left in the deck of cards. You’ve seen five cards, so the deck has 47 cards left. If you keep the pair of jacks, the deck has two jacks left. You also know that if you played the hand 47 times that the least you win is one to one on each hand, for a minimum of 47.
When you draw to an outside straight, the deck has eight cards that complete the straight. A straight pays four to one, so if you run the hand 47 times you hit a straight eight times. Eight times the payout of four is only 32.
When you use math you can see why it’s better to keep the pair of jacks than drawing to the straight. You can use examples like this to help your kids learn about probability. This can be more fun than just giving them math problems, which makes it easier to learn and remember.
Where to Start
Blackjack is the best way to start teaching your kids about gambling. It’s an easy game to learn and builds simple math skills while playing a game. Simple dice games using two dice are another possibility. Two dice only have a small number of possible outcomes, so it’s easy for kids to learn everything there is to know about the possibilities.
You don’t have to use gambling games to start using games to teach kids about math. Yahtzee offers a great way to teach adding small numbers and to introduce probability.
Here’s an example:
On the first of three rolls in Yahtzee you roll a three, four, five, and two sixes. What chance do you have of rolling a two on the next roll if you keep everything except one of the sixes? The answer is one out of six. You roll one die and the two comes up one out of six times.
What are the chances to roll a two on one of the next two rolls? Each roll offers a one in six chance, so this is the same as a fraction with one over six. You add one over six to one over six and you get two over six, or one over three reduced. So the chance to roll the two you need on one of the next two rolls is one over three, or one third.
But you can only use normal games to go so far. Gambling games allow you to add more mathematical concepts and go deeper into the math, while keeping kids interested because the lessons are disguised as games.
In addition, as your kids learn more about gambling they can learn that there are a few ways to gamble with an edge.
Teach Them Advantage Play Methods
Earlier I explained that if you teach your kids how to use math to see how playing casino games is a losing proposition you can help them understand why they shouldn’t play unless they’re prepared to lose. This is one of the most powerful reasons to teach kids about gambling.
But why not take things a step beyond that ad teach them how to break even, or have a realistic chance to win, when they gamble?
The gambling world offers four main areas where you can realistically earn money, instead of losing on a consistent basis.
Here are the four areas:
- Be the house
- Sports betting
I recommend teaching kids about all four areas, but at the minimum you should consider teaching them about being the house instead of the gambler. The house is set up so that if they run things correctly they never lose money. It’s not cheap to start a casino, but it’s best way to be involved in gambling with a real chance to make money.
When kids learn how business works, it can help them throughout their lives, even if they never run their own business. They learn about profits, losses, overhead, and budgeting. These are all important life lessons.
The other three things on the list all offer a chance for a gambler to break even of make money in the long run. None of them are easy to beat, but if you or your kids can learn how to do it you can gamble as much as you want.
You can learn how to beat blackjack, or at least reduce the house edge to break even, by finding good games, getting comps, and counting cards. I taught my kids how to count cards, and they learned it much quicker than I did. Neither one of them counts cards now, because they don’t gamble much, but it was a good way for them to learn what it takes to beat the house.
Poker offers a good opportunity to make money or break even because the house doesn’t have an edge like in most other casino games. The house takes a rake from each pot for their profit. If you can learn how to play better than your opponents, it’s easy to win in the long run. The way to start is by learning everything you can about odds and probabilities dealing with a deck of cards, and then learning how to use pot odds.
Sports betting also offers a chance to win in the long run, but it’s the hardest thing on the list. To be a winning sports bettor you have to dedicate a big part of your life to handicapping and watching games.
It’s important to teach a kid how hard beating the casino is, but if they might gamble when they grow up if you teach them about advantage play at least they have a chance to win.
It’s up to you to decide if teaching your kids about gambling is the right thing to do. I taught both of mine about gambling, and neither is really interested in doing it now that they’re old enough to do it on their own. If you don’t want to expose them to gambling, at least consider using a deck of cards and a set of dice to teach them simple probabilities and odds.