Oct 8, 2025
Matt is about to receive a $35,000 workers' compensation settlement, something many would be pleased about. For him, though, the payout feels like both a blessing and a curse — and the stakes couldn't be higher.
On paper, it’s a chance for Matt to pay off his debt, build savings and set the foundation for retirement. But in reality, the money could slip away almost instantly. Matt's problem? A long-standing gambling habit that has drained savings and left him with little to show for it. Now he's desperate to find ways that keep him away from the casino and keep his windfall in his pocket.
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According to the National Council on Problem Gambling, (1) a nonprofit that aims to minimize the economic and social costs of gambling addiction, about 2.5 million U.S. adults (1%) meet the criteria for severe gambling problems, with another 5 to 8 million experiencing mild or moderate issues.
Matt’s settlement could represent a turning point. Instead of another missed opportunity, it may become the foundation of long-term stability. But to achieve that, Matt must put some safeguards in place from day one, before the temptation to “double it” at a casino or sportsbook becomes too hard to resist. Here are some examples of ways Matt can make the most of his windfall without falling into old habits.
1. Clear existing debts
Debt payoff is typically the smartest first move to make when you receive a lump sum of money, especially for someone vulnerable to risky spending, such as Matt. High-interest credit card debt, for example, can carry rates above 20%, meaning the money evaporates quickly if left unpaid. Eliminating these balances first reduces monthly obligations, frees up cash flow and provides an immediate sense of progress.
But what happens after the debt is gone? For those with a gambling issue, leaving the rest in a checking account could be a recipe for relapse.
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2. Use accounts with withdrawal penalties
Instead, Matt can use products such as 401(k)s or traditional IRAs that come with penalties for early withdrawals. While these fees frustrate some investors, they can be a hidden benefit for someone looking to restrict access to their own funds. A 10% penalty for early withdrawal may be just enough of a deterrent to keep the money untouched until retirement.
Other vehicles, like certificates of deposit (CDs), could also offer Matt structure and discipline. With CDs, funds are locked in for a set term at a specific interest rate. Withdrawing early means paying a penalty and losing accrued interest. Even if the rates on CDs aren’t spectacular, the forced waiting period can help him prevent impulsive spending.
3. Consider long-term investments
Once his immediate debts are gone and short-term safeguards are in place, Matt can turn his attention to growth over the long term.
Low-cost target-date retirement funds or index funds tracking the S&P 500 can provide diversified exposure to the stock market, historically returning about 10% annually over the long term. While market swings are inevitable, these investments build wealth when left untouched for years.
The challenge for someone with a gambling addiction, like Matt, is resisting the urge to treat investments like bets. That’s why automation — setting up recurring contributions and minimizing account access — becomes crucial.
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4. Address the gambling problem directly
Even the best financial strategy won’t work unless Matt tackles the root problem. Financial safeguards are most effective when paired with emotional and behavioral change.
One effective tool is self-exclusion, a voluntary program where individuals ban themselves from casinos or online betting platforms. Once enrolled, casinos are legally required to deny entry or services, and winnings may even be forfeited if they try to gamble despite the ban.
In addition, seeking help from organizations such as Gamblers Anonymous or local counseling programs can provide Matt with accountability and community support.
Article sources
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National Council on Problem Gambling (1)
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With a writing and editing career spanning over 13 years, Emma creates and refines content across a broad spectrum of industries, including personal finance, lifestyle, travel, health & wellness, real estate, beauty & fitness and B2B/SaaS/tech. Her versatility comes through contributions to high-profile clients like Moneywise, Healthline, Narcity and Bob Vila, producing content that informs and engages, along with helping book authors tell their stories.
