Winning Half Your Bets Is Still a Losing Year
More than half of Gen Z investors moved money out of investing and into sports betting last year. Here is the math behind that trade, and a way to talk about it that might actually land.
The number
Betterment polled a thousand US retail investors across four generations this past April. Among the Gen Z investors in that sample, 52% said that in the past year they took money earmarked for investing and put it on sports betting instead. Fourteen percent do it multiple times a month. And 26% described sports betting as a deliberate part of their long-term financial strategy, against 6% of Gen X and 1% of boomers.1 Read that last one twice. A quarter of the youngest investing generation is not treating this as entertainment. They are treating it as the plan.
Fair warning on the data: it is a self-reported online survey of people who already invest, and Betterment did not report how much money got redirected.1 Twenty dollars a week is a different story than a Roth contribution. But the direction lines up with everything else we can see. Americans legally wagered about $166.9 billion on sports in 2025, up from roughly $13 billion in 2019.2, 3
I am not here to yell at clouds
Every generation gets a turn at financial mania. In the late nineties, Boomers and Gen X fueled the dot-com bubble by chasing compelling narratives over actual profits. More recently, Millennials spent fortunes on JPEGs of cartoon apes during the NFT craze. But what sets the current moment apart isn't the recklessness of youth—it's the underlying structure of the market itself.
The difference is, the sports betting market is backed by incredible ad spending. We are watching venture capital, private equity, and public markets fund an industrialized customer acquisition machine, complete with half a billion dollars in celebrity endorsements. This isn't a bubble; it's a funnel.
The line has gotten blurry in a way that is worth seeing clearly. Several mainstream brokerage apps — the same ones marketed as a place for ordinary people to start investing — now carry prediction markets alongside stocks and funds. These are event contracts: a binary Yes or No on something happening, settling at a dollar if you are right and nothing if you are wrong. They are regulated as derivatives by the CFTC rather than as wagers by a state gaming board, and the contracts on offer now include point spreads, game totals and whether a given player scores.
They do not call it sports betting because, legally, it is not. But functionally, the brokerage account has become a sportsbook. The exact same app where a 22-year-old should be saving for a down payment on a house or building toward their life goals is now simultaneously serving up fractional bets on Sunday football games. When the space meant for securing a financial future is actively merged with a casino, the distinction between investing and gambling isn't just getting lost. It is being intentionally dismantled.
Owning something versus paying the house
Buy a stock and you own a fractional piece of a real business. If it earns money, you have a claim on it, and nobody skims a percentage off your gains for the privilege. You can be wrong about timing and still come out ahead, because the business kept working while you waited. There are no guarantees anywhere in investing and there are stretches that feel awful, but the structure is on your side. A sportsbook is built the other way around.
In 2025 Americans wagered about $166.9 billion and the books kept about $17 billion of it - call it ten cents of every dollar that never walked back out.2 On top of that, a standard -110 line means you risk $110 to win $100, so you need to hit about 52.4% of your bets just to get back to even. Winning half is a losing year.
None of that is a scandal or a rigged game. It is the disclosed, advertised business model. The books are not hoping to win. They are built to win, slowly and reliably, on volume.
The part that actually stings
It is not the losses. It is the compounding you never got to keep.
Hypothetical illustration, not a projection. A 22-year-old redirects $200 a month away from investing for 40 years. The contributions alone total $96,000. Invested instead at a hypothetical 7% annual rate, that same $200 a month would reach roughly $525,000 by age 62. At a hypothetical 10%, roughly $1.26 million. Assumptions and limitations are in the Notes below.4
The distance between that first bar and the other two is compounding. It is the only part of investing that works while you sleep, and a negative-expectation activity quietly deletes it. Money at a sportsbook is not sitting still. It is being ground down.
Where they are learning this
The same survey found 60% of Gen Z investors now name social media as their most common source of financial news, up from 45% in 2024. Only 21% named a financial advisor.1 That feed serves a video explaining dollar cost averaging and a video of a $50,000 parlay hitting through the exact same algorithm. One of those has a marketing budget in the billions behind it.
If you have a twenty-something in your life
Most people reading this are not Gen Z, so the useful question is not what they should do. It is what you can say. A lecture will bounce. Arithmetic delivered without judgment tends to land.
Skip the morality, use the cut. Ten cents of every wagered dollar stays with the house. Ask what they think their win rate is, then ask what it needs to be.
Give the fun money a name. Forty dollars on a Sunday is a hobby, and hobbies cost money. The trouble starts when the hobby gets funded out of the investing line.
Automate the investing first. Money that leaves on payday never has to win an argument against a same-game parlay.
Show the numbers, not the moral. The chart above, assumptions and all.
Watch for the tell. Chasing losses, hiding it, betting on games they do not care about, borrowing to bet. That is not a budgeting conversation anymore. The national helpline is 1-800-GAMBLER, and the Wisconsin Council on Problem Gambling is a good local start.
Nobody is buying commercials for compound interest. If the people who care about these kids do not have the conversation, it does not happen.
Want to talk it through?
We help pre-retirees, retirees, landowners and business owners build plans that work over decades: investment management, tax and income planning, estate and legacy analysis. Book a no-cost introductory conversation at longevitywealthadvisory.com/book-online.
Notes
On the survey. Betterment's 2026 Retail Investor Survey is a self-reported online poll of 1,000 US retail investors across four generations, fielded April 2026 and released August 12, 2026. All respondents held at least one qualifying investment. Dollar amounts redirected were not reported. Percentages describe Gen Z investors in the sample, not Gen Z Americans generally.
On the hypothetical. Assumes $200 invested at the end of each month for 480 months at a constant annual rate compounded monthly, with no taxes, fees, withdrawals or interruptions. The 7% and 10% rates are illustrative inputs, not forecasts of any market, index or strategy. Real portfolios face negative years, fees, taxes and inflation. No outcome shown is guaranteed.
On the break-even figure. Arithmetic from standard -110 pricing: $110 risked to win $100 requires 110 divided by 210, or 52.38% of wagers to win, in order to return the amount staked.
Footnotes
1. Betterment, 2026 Retail Investor Survey, released August 12, 2026 (fielded April 2026; n = 1,000 US retail investors across four generations).
2. American Gaming Association, Commercial Gaming Revenue Tracker, full-year 2025 results released February 26, 2026: $166.94 billion handle, $16.96 billion sports betting revenue.
3. American Gaming Association, full-year 2019 results released February 2020: approximately $13 billion legally wagered.
4. Longevity Wealth Advisory calculation, September 2026. Hypothetical; assumptions in Notes.
Longevity Wealth Advisory LLC is a fee-only financial advisor in Wisconsin and acts as a registered investment adviser registered with the State of Wisconsin. Registration does not imply a certain level of skill or training.
This material is provided for educational and informational purposes only and does not constitute investment, tax, legal or accounting advice, nor an offer or solicitation to buy or sell any security. It does not take into account any individual's particular circumstances, and no statement here should be construed as a recommendation. Any examples are hypothetical, are provided for illustration only and do not represent the experience of any client or the performance of any investment. Investing involves risk, including the possible loss of principal. Rates of return shown are assumed inputs, not projections; past performance is not a guarantee of future results. Third-party data is believed to be reliable as of the dates cited but has not been independently verified and is subject to change. Consult a qualified professional regarding your own situation before acting on any information contained here.
