Investing Winnings

[UncleHoot 0]

Ok, I'm joking about winning so much, but with 2007 quickly approaching, it looks like poker has become like a really underpaid second job for me. I made enough money in 2006 that I almost feel guilty about not keeping track and not paying my taxes (but not quite). Ok, I'm talking less than $2,000, but honestly, I don't know. For the first half of 2006, I wasn't a very good player, and I was barely breaking even, so keeping track of anything wasn't on my mind at all. In 2007, I would like to keep track of wins/losses a lot better.Which brings me to my real question. I have also thought about investing my meager winnings into something like a Roth IRA. Yes, I could move up in limits, but I'm pretty comfortable where I am right now, and if I could dump a couple grand or more into a Roth IRA in 2007, I think that would be pretty cool.Has anyone else done this? Thoughts?

[RayPowers 0]

I feel an obligatory TP/MM is necessary here.Ray

[7s7c 0]

Oh boy....wait for it....wait for it....

[Vick12 0]

I feel an obligatory TP/MM is necessary here.Ray

Too damn fast for me today Ray!

[Tiltinagain 973]

Just an FYIPutting money into an IRA before April 15th allows you to take a deductionon it for 2006.Please consult a tax advisor though, cuz I'm not one

[RayPowers 0]

Serious Answer:I put the maximum I could into an investment account set up by my Accountant, tax free.I bought a pool with the rest, which I will have to pay taxes on.If you have a "real job" like I do, and don't want to turn pro, investing is the best possible plan. Ray

[pokerinc 0]

roth ira's not a bad plan since you normally contribute after tax dollars to that. you'd effectively be getting the benefits of both 401k and ira. super tax free investing. pretty sick.

[UncleHoot 0]

roth ira's not a bad plan since you normally contribute after tax dollars to that. you'd effectively be getting the benefits of both 401k and ira. super tax free investing. pretty sick.

Well, depending on how much I won, I may be honest and pay taxes regardless. I don't know where anyone else sets the "I'll pay taxes now" cutoff, but I always figured it was when I reach a point where I've made more than a few hundred dollars. <rant>On the other hand, I find it ironic that I'd be willing to pay taxes to a government for making money at something which they believe I should be prohibited from doing.</rant>

[RayPowers 0]

<rant>On the other hand, I find it ironic that I'd be willing to pay taxes to a government for making money at something which they believe I should be prohibited from doing.</rant>

Its easier than trying to explain why your bank account has four $5K deposits in under 24 hrs. Trust me on this one.Ray

[Orion071 0]

roth ira's not a bad plan since you normally contribute after tax dollars to that. you'd effectively be getting the benefits of both 401k and ira. super tax free investing. pretty sick.

Let me be the 'old guy' to tell all you young whipper-snappers that a Roth IRA is one of the best ways to save for retirement. You can put up to $4000 per year into one and as someone said above, you have until April 15th to put in a contribution for 2006. Everyone who has one should be investing the their company's 401k up to what their company matches (since the match is free money), but after that, they should invest anything extra in a Roth.

[LuckyMcCatcher 0]

Its easier than trying to explain why your bank account has four $5K deposits in under 24 hrs. Trust me on this one.Ray

If all you have made is 2k, i dont understand why you would invest. Do you plan on quitting poker? Never moving up? If not then invest in your roll so that one day you can make an investment worthwhile.

[RayPowers 0]

If all you have made is 2k, i dont understand why you would invest. Do you plan on quitting poker? Never moving up? If not then invest in your roll so that one day you can make an investment worthwhile.

2K is not bad for an investment.Yeah, I assume he's not intending to move up, or obviously bankroll building is an excellent answer as well.Ray

[UncleHoot 0]

If all you have made is 2k, i dont understand why you would invest. Do you plan on quitting poker? Never moving up? If not then invest in your roll so that one day you can make an investment worthwhile.

For me, "Move up" means playing $10 and $20 SnG's. At this time, I don't see myself building a bankroll for the purpose of moving up, but you never know... Poker is more of a "hobby income" sort of thing. I don't see that changing significantly over the next couple of years. Mostly, I just hope I can still play online in a year.On the one hand, I want to be the best player EVAR!!! But the reality is that this isn't going to happen. I'm not only unlikely to turn pro, but I'm not even sure I would want to. Will I move up in limits? Maybe, maybe not. But I like the idea of taking money out and investing it elsewhere, even it's only a few hundred bucks.

[LuckyMcCatcher 0]

For me, "Move up" means playing $10 and $20 SnG's. At this time, I don't see myself building a bankroll for the purpose of moving up, but you never know... Poker is more of a "hobby income" sort of thing. I don't see that changing significantly over the next couple of years. Mostly, I just hope I can still play online in a year.On the one hand, I want to be the best player EVAR!!! But the reality is that this isn't going to happen. I'm not only unlikely to turn pro, but I'm not even sure I would want to. Will I move up in limits? Maybe, maybe not. But I like the idea of taking money out and investing it elsewhere, even it's only a few hundred bucks.

Well if thats your aim then it makes sense. You are obviously not a hopless degenerate like most of us. More power to you. I invest my winnings, but only on high risk/high reward stuff. I just pulled my money out of E-trade, because the variancein the market isnt high enough to interest me. Lol.

[Pot Odds RAC 23]

If all you have made is 2k, i dont understand why you would invest. Do you plan on quitting poker? Never moving up? If not then invest in your roll so that one day you can make an investment worthwhile.

I agree, $2K is not retirement money. I'd say treat it either as your Bank Roll and keep adding to it, or splurge on something. $2,000 could pay for a weekend in Vegas. Buy the more expensive something of whoch you'd normally buy a cheaper version. Turn your Poker into FUN!

[UncleHoot 0]

Its easier than trying to explain why your bank account has four $5K deposits in under 24 hrs. Trust me on this one.Ray

Did you bluff the river? lol

[Pot Odds RAC 23]

If you really want to invest in something how about this for an idea?Invest in the First National Bank of Friends. I like to use my winnings as "Found Money". When I go out with the gang and I have winnings in my pocket, I don't make a big deal of it - I never mention it - but I like to pick up the tab wherever we are. Lunch, dinner, drinks, whatever - I say: "I've got this one - you can pick up my tab some other time"It is a nice social gesture, and is like money in the bank of your friends - it'll come back, sort of like Karma. It encourages you to spend time with your friends. Often it is repayed in higher returns and other intangibles......and if it doesn't come back, you've also learned something about particular "friends"

[RayPowers 0]

Did you bluff the river? lol

I told my accountant to pay the nice IRS men when it came time this year. I was kind of lacking in options. :)Ray

[Orion071 0]

I agree, $2K is not retirement money. I'd say treat it either as your Bank Roll and keep adding to it, or splurge on something. $2,000 could pay for a weekend in Vegas. Buy the more expensive something of whoch you'd normally buy a cheaper version. Turn your Poker into FUN!

$2K, invested one time, might not be retirement money. But that's just winnings for 1 year. $2K a year, if started early enough, is an excellent start towards retirement. The problem with a lot of poker players is that they live for today and don't think about tomorrow. People in their 20's have the same problem. If the guy wants to invest his money, good for him.$2,000 a year starting at age 25 and assuming a standard 8% return will be $477,000 by the age of 65.

[Pot Odds RAC 23]

$2K, invested one time, might not be retirement money. But that's just winnings for 1 year. $2K a year, if started early enough, is an excellent start towards retirement. The problem with a lot of poker players is that they live for today and don't think about tomorrow. People in their 20's have the same problem. If the guy wants to invest his money, good for him.$2,000 a year starting at age 25 and assuming a standard 8% return will be $477,000 by the age of 65.

Not completely disagreeing with you. But the OP doesn't consider Poker to be a "job". He isn't a "poker player living for today", he is a working guy who plays some poker for fun (apparently). Sure I find it laudable that he wants to be responsible - that is part of the reason I am urging him not to be! $2,000 at any current or historical rate of return just doesn't turn into a cushy retirement (and we ARE talking about $2K ONE time). I am very good at compartmentalizing my life - including my finances. I treat my gambling money differently from my "normal" income. Call it a diversified life portfolio.

[UncleHoot 0]

Not completely disagreeing with you. But the OP doesn't consider Poker to be a "job". He isn't a "poker player living for today", he is a working guy who plays some poker for fun (apparently). Sure I find it laudable that he wants to be responsible - that is part of the reason I am urging him not to be! $2,000 at any current or historical rate of return just doesn't turn into a cushy retirement (and we ARE talking about $2K ONE time). I am very good at compartmentalizing my life - including my finances. I treat my gambling money differently from my "normal" income. Call it a diversified life portfolio.

No, it wouldn't be $2K one time, but I can't say it would be $2K per year for the rest of my life, either. I just don't know how much longer I will continue playing poker. I really don't. I expect it to last a couple more years, but I can't see beyond that. Maybe I'll start playing live tourneys at my local casino on a regular basis. Maybe I'll lose interest. I'm funny that way.I guess the biggest question would be "Where would my money be most likely to make me the most money?" If I never move up in limits, it would make sense to invest it. If I continually move up in limits, and practice bankroll management, it may be better off there. Dunno. I'ts not a heck of a lot of money either way.

[Dratj 0]

No, it wouldn't be $2K one time, but I can't say it would be $2K per year for the rest of my life, either. I just don't know how much longer I will continue playing poker. I really don't. I expect it to last a couple more years, but I can't see beyond that. Maybe I'll start playing live tourneys at my local casino on a regular basis. Maybe I'll lose interest. I'm funny that way.I guess the biggest question would be "Where would my money be most likely to make me the most money?" If I never move up in limits, it would make sense to invest it. If I continually move up in limits, and practice bankroll management, it may be better off there. Dunno. I'ts not a heck of a lot of money either way.

Move up in limits.

[Orion071 0]

Not completely disagreeing with you. But the OP doesn't consider Poker to be a "job". He isn't a "poker player living for today", he is a working guy who plays some poker for fun (apparently). Sure I find it laudable that he wants to be responsible - that is part of the reason I am urging him not to be! $2,000 at any current or historical rate of return just doesn't turn into a cushy retirement (and we ARE talking about $2K ONE time). I am very good at compartmentalizing my life - including my finances. I treat my gambling money differently from my "normal" income. Call it a diversified life portfolio.

I also don't play poker for a living. I have a very nice programming job, and I play 10-15 hours of poker a week for fun. But I have the luxury of using my poker winnings for fun because I'm already saving plenty for retirement. The OP may not have that opportunity so I find it great that he wants to use that money for the future and now for fun now.I also am not using my money to move up in limits. I play $100 NL and I do fairly well at it. When my bankroll hit $4K, I moved up to $200 NL, but I just didn't feel comfortable. For some reason the money was just too much. So I took out $2K and went back to $100 NL. I'll probably continue to play $100 NL for the forseeable future and keep withdrawing the profits.So I guess if the OP is happy with the limits he's playing and is doing well, he should just keep it up.

[Actuary 3]

this thread belongs to Orion.and Tiltin, roth's are not tax deductible contributionbut they are tax free w/d's.

[finztotheleft 0]

To move up in limits, we should have the bankroll and the skills. If you are comfortable where you are, stay at that limit until you are sure you're ready to move up (like when you have earned another $2000 to pad your roll) Do the IRA.......you'll be glad you did when you are 65.