Gambling is for losers, isn't it? Of course it is! The lights and sights of Las Vegas did not simply spring up from the desert due to a worldwide surge in demand for sand.
Aside from placing a few quid on The Grand National (if I even remember it's on) I've never been involved nor had an interest in gambling. Then I recently came across this thing called matched betting on a student forum, which appeared to turn the odds in your favour. In the past few years, it has become increasingly popular as a way for students to boost their income at university.
Whilst it certainly does not involve the blatant risks associated with gambling, there are concerns that students are jumping into matched betting without really understanding what it is. Patience, having a good grasp of numbers and some starting money is required and, if you get it wrong, you stand to fund another light bulb in Vegas.
However, if you put some time aside to really understand matched betting, and get it right, there are a good number of people out there in these forums proving that they have been making the equivalent of £30 an hour, tax free. And apparently they haven't been arrested, so I thought I'd give it a go for myself (with a healthy dose of scepticism).
It took me a while to get my head around, and I did make a few mistakes to start with partly because the information that was out there for a newbie like me was very fragmented, and partly because I was so eager to get on with making an apparently easy fortune. Well I didn't get to that exactly, but I did come away from my first experience of matched betting with over £800, enough money to pay for a nice holiday.
What is matched betting?
Since my first taste of success at matched betting, I've tried explaining the concept to a number of friends, but I always struggle because it is a bit confusing for non-gambling types. With the benefit of editing, I'll try and summarise it here more concisely.
Firstly, it's important to realise that matched betting is not akin to gambling. It's a rare legal example of playing the system, which is recognised by the gambling industry. The bookmakers appear to have no issue with it because even they don't lose out (source). Whilst it isn't gambling, it does benefit from the fact that winnings from gambling activities are not currently taxed in the UK.
Now for the hard bit - how it works in a nutshell.
Matched betting takes advantage of the free bet offers that the majority of betting websites (such as PaddyPower.com) promote to attract new players. These tend to range from £10-£200.
The idea is that you can extract these free bets by betting both for and against a certain event. You can bet against the event (known as 'laying') at an online betting exchange, such as Betfair.com.
In effect there is no risk of losing money because the two bets pretty much cancel each other out (bar some minor differences in the odds and commissions).
Seems like quite a pointless exercise, no?
Well, the key to extracting a guaranteed profit is to repeat the process of 'matching' a bet once again, but this time using the free bet rather than your own money. Whatever the outcome, you are guaranteed to 'win' money. Applying the same technique to extract free bet offers from the many other online bookmakers can result in a pretty impressive haul.
That's pretty much the jist of it. I recommend you follow this matched betting guide if you're interested in finding out more.
Should students really be staking their loans on matched betting?
There is a risk that anyone looking to make a quick buck could end up losing out, but theoretically matched betting itself is risk-free. The main reason for losing money here is down to a general lack of understanding and charging into it head-on. It's important to spend time reading up on the technique, and record all activity within a spreadsheet.
I would suggest that the real danger lies with students actually succumbing to the whole reason why betting companies promote free bet offers in the first place. For some, matched betting could be a Trojan horse into the world of gambling.
Once you have registered, set up payment details and engaged with a betting website it's obviously going to be easier to have a quick flutter every now and then, especially with the amount of marketing emails you're likely to receive. So it's really important to stop once all free bet offers have been exhausted, and never back a bet without laying it too.
Matched betting is not a long term source of income but, as I can now vouch for, it is a completely validated and risk-free method of topping up a woeful bank balance. And the best bit of all? It doesn't involve any grovelling to parents.
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