For a lot of Gen Z, gambling is investing

**Adrian Ma** (0:01)
NPR.

**Ricky Mulvey** (0:06)
The line between investing and gambling is blurry now.

**Adrian Ma** (0:10)
Yeah, get this. In the past year, more than half of Gen Z say they've taken dollars intended for investing and put it towards sports gambling.

**Ricky Mulvey** (0:18)
And you can understand why sports betting seems like easy money, when many sports betting commercials advertise hundreds of dollars in free bets just for making a small deposit.

**SPEAKER_3** (0:28)
All customers get a profit boost every NBA playoff game. New customers spend $5 to get 300 in bonus bets if you win. New customers turn five bucks into 200 instantly in bonus bets.

**Ricky Mulvey** (0:38)
This is The Indicator from Planet Money. I'm Ricky Mulvey.

**Adrian Ma** (0:41)
And I'm Adrian Ma.
The federal ban on sports betting was struck down eight years ago, and we're just now learning the effects on younger people. Today in the show, we take a look at what ubiquitous gambling advertising has done to Gen Z.

**Ricky Mulvey** (0:54)
And how one state government is starting to put up guardrails.
For some people, sports betting is more than entertainment. They're trying to make real money with it. In a recent survey, about a quarter of Gen Z said they view sports betting as a high-risk investment strategy or a way to accelerate some kind of goal. Gen Z is anyone aged around 18 to 29

**Dan Egan** (1:19)
I think, you know, number one, it's not good.

**Adrian Ma** (1:23)
That's Dan Egan, vice president of behavioral science and investing at Betterment. They studied the relationship different generations have with investing and gambling, and we got some of the numbers you heard from their recent poll.

**Dan Egan** (1:34)
I have friends who like, I don't know, collecting cars, but they're honest about the fact that that car, they're not making money on it. It's a hobby. They enjoy it. They enjoy looking at the car. I think the dangerous aspect is when we start confusing our hobbies for investing.

**Ricky Mulvey** (1:46)
Dan says one reason why so many members of Gen Z are using investing dollars for gambling is overconfidence, like, I watch a ton of basketball, I can spot a winner.

**Adrian Ma** (1:56)
And also, some people in younger generations feel this economy just isn't working for them.

**Dan Egan** (2:01)
So I think that's one of the drivers, is the idea that in order to get ahead, just like doing my job, saving regularly, and focusing on my career isn't going to be enough. I have to have some big financial wins.

**Adrian Ma** (2:12)
But this isn't true across the board.

**Ricky Mulvey** (2:14)
Are you Gen Z?

**Dan Egan** (2:16)
Yes.

**Ricky Mulvey** (2:17)
Sam Mascara is a 27-year-old incoming PhD student at the University of Michigan. And to be clear, he is three years younger than me, so we are not talking about an alien population here, Adrian.

**Adrian Ma** (2:29)
Sam used to bet on basketball, and he saw the ads promising hundreds of dollars in free bets for just a small deposit.

**Ricky Mulvey** (2:36)
And one of Sam's coworkers said, hey, if you sign up for a sports betting account, then I get a reward too.

**Sam Mascara** (2:41)
So he was like, if you join, there's this promotion going on.
And I figured it was like five bucks. The NBA preseason was just starting, so I figured it'd be something to try.

**Adrian Ma** (2:52)
Why does this feel like a after school special in the making?
Sam says he'd use just about any platform that had a bonus. Bet MGM, FanDuel, even the old ESPN platform.

**Ricky Mulvey** (3:04)
And he says that he never bet more money than he was willing to lose, but worries about people even younger than him, Gen Alpha. He taught high schoolers.

**Sam Mascara** (3:12)
I was seeing economically disadvantaged students. They would tell me, like, this is an easy bet, or like, this is like an easy way to make money.

**Adrian Ma** (3:20)
He says that some students would find an adult to sign them up for a sports betting account and start playing.

**Sam Mascara** (3:26)
These are 16-year-old kids. They did not have the self-control to say, I'll only use the promotion money. I'd hear kids talking to you like they're putting up like $200 of their money on a random like basketball game.

**Ricky Mulvey** (3:40)
And to be clear, we're just talking about the sports books here, like FanDuel and DraftKings, not prediction markets. That's a slightly different beast.

**Adrian Ma** (3:49)
Yeah, and we've reported on how prediction markets like PolyMarket and Kalchi can advertise to vulnerable people. You can find a link to that in the show notes.