Gen Z Can't Tell Investing From Gambling, and the Data Shows the Cost

Investing, gambling, and pure entertainment now sit on the same device, often in apps with nearly identical interfaces, and that overlap is making it harder for young people to tell the three apart, according to Aneri Jambusaria, chief wealth officer at LPL Financial. Her argument isn't that Gen Z is uniquely reckless with money, but that the tools available to them no longer signal which activity they're actually engaged in the way a brokerage account once did.

The numbers back up the concern. Among Gen Z investors ages 18 to 25, 61% report gambling either online or in person, and 26% say they consider sports betting part of their investment strategy, compared with just 6% of Gen X and 1% of Baby Boomers who say the same. More strikingly, 52% of Gen Z investors say they've redirected money originally set aside for investing into sports betting within the past year.

That shift has real financial consequences. Domestic sports betting has grown into an industry worth nearly $17 billion, up from about $400 million in 2018, and a UCLA study found credit scores declined by 0.8 points after states legalized sports betting, and by 2.75 points once online sports betting specifically became available, suggesting the habit is already showing up in people's broader financial health.

Jambusaria draws a clear line between the three categories: sports betting, in her framing, is primarily entertainment; prediction markets are a more speculative activity built around short time horizons; and long-term investing is fundamentally about owning productive assets and participating in economic growth over years, not days. Her core recommendation is simple: before putting money into any app, decide whether the goal is building long-term wealth, expressing a short-term view on an outcome, or simply paying for entertainment, because conflating the three is where the real risk lies.