Gen Z is moving investment money into sports bets

Money meant for investing is finding its way into sports bets. In an August survey by investment advisory platform Betterment, 52% of Gen Z retail investors said they had redirected investment funds into wagering. Another 26% considered betting part of their long-term financial strategy. The findings, reported by CNBC Economy (direct), point to a growing challenge for financial and mental health professionals: persuading young people that a wager and an investment are not interchangeable.

Betterment found that 66% of Gen Z investors surveyed participated in sports betting. Separately, a September report from the Bank of America Institute said Gen Z accounted for nearly half of online betting activity in July, during the 2026 FIFA World Cup, overtaking millennials for the first time. Its survey also found that Gen Z respondents were twice as likely to regard sports betting as investing, compared with 20% of respondents overall. These figures describe different groups and measures, but together show how deeply betting has entered young adults’ financial lives.

When betting looks like investing

Access has expanded sharply since a 2018 U.S. Supreme Court ruling opened the way for state-authorized sportsbooks, which now operate in 30 states. Sports-related event contracts arrived on prediction markets in early 2025, extending access to additional states without legal sportsbooks and to people under 21. These contracts let users trade on an event’s outcome. Prediction platforms classify them as financial derivatives—contracts whose value depends on an underlying outcome—rather than wagers. DraftKings and FanDuel management, by contrast, generally describe their sportsbook products as entertainment.

Dan Egan, Betterment’s director of behavioral finance and investing, said the appearance of betting alongside traditional investments on the same app or device helps blur the distinction. Yet managing sports wagers requires frequent action, unlike holding a long-term investment, he said. His central warning was that betting is not an asset that grows with the economy and offers a positive expected return over time.

Egan’s message: sports betting should be understood as entertainment, not confused with long-term investing.

The financial stakes extend beyond individual bets. Bank of America found that median deposit account balances among households using online betting were only 59% of those among households that did not. That comparison does not establish that betting caused the gap. An August BadCredit survey found that 44% of respondents began trading on prediction platforms hoping to earn extra income, even though most sportsbook and prediction-market users lose money. BadCredit consumer finance expert Erica Sandberg said people tend to publicize wins while keeping losses to themselves, creating a misleading picture for others.

The challenge moves beyond the wallet

Cynthia Grant, vice president of clinical at Birches Health, said warning signs emerge when gambling disrupts relationships, work or school. Trying to recover losses can deepen financial problems, experts warned, while heavier losses bring greater mental health risks. Amaura Kemmerer of mental health provider UWill said even occasional betting can hurt students’ academic performance. She and Grant identified college campuses as an important place for intervention, with counseling services treating gambling problems as they would other addictions.

Platforms have introduced safeguards, including age checks and voluntary limits. FanDuel and DraftKings allow users to cap deposits or time spent, while FanDuel also applies monthly deposit limits to users under 26. Polymarket announced optional limits and a Birches Health partnership; Kalshi also offers limits and mental health resources, and directs users aged 18 to 21 toward risk-management programs after their first trades. CNBC disclosed a commercial relationship with Kalshi, including customer acquisition and a minority investment. The issue to watch is whether these safeguards and campus support can help young users keep entertainment separate from their financial plans.