Sports Betting Versus Investing: 4 Key Differences

People who know me know I'm a huge sports fan. I still root for my college football and basketball teams and watch professional sports in Dallas where I live. But for some fans, sports betting is changing the game.

Sports betting is a big business that's growing in popularity. Since a 2018 Supreme Court ruling opened the door for legalized sports betting, some states have gone all in. And today, 38 states allow it. In the car on the way to work, I hear sports radio shows talk about the best bets of the weekend. When I watch television at home, I see sports betting commercials everywhere. Forty-eight percent of American men between 18 and 49 have an account with at least one of the online sportsbooks, according to a Siena College Research Institute survey.

While sports betting—when legal—can feel fun and exciting, it could open the door to troubling money moves. In fact, 52 percent of those in the Siena survey report "chasing" a bet. And 20 percent of survey respondents say their losses have led to trouble meeting financial obligations.

Of course, many people who place sports bets do it responsibly, and this kind of entertainment in moderation isn't inherently bad. But when sports betting is viewed as a reliable source of income, or a way to make quick money, that's concerning.

You especially don't want to confuse sports betting with disciplined investing. There are substantial differences between any type of gambling and investing—particularly when it comes to risk, time, behavior, and outcomes.

Let's explore four key differences between sports betting and investing.

The rise of trading apps and online sportsbooks have helped blur the line between investing and gambling for some people. For some newer investors, it could be easy to confuse the two. Both involve risk. Both can be exciting. But when it comes to risk management, they couldn't be more different.

• Investing with a disciplined approach can mean taking calculated risks that could pay off over time. Investors can work to help manage risk with diversification, research, and a time horizon—all aligned with your financial goals.
• Sports betting, which is a form of gambling, means taking risks that aren't likely to pay off at all. It's high risk/low control, and outcomes are based on chance, not strategy.

Key difference: With sports betting, you either win or lose. More often than not—the house wins. While there's no free lunch and no guarantees with investing, it has a longer history of growth over time if you stick with a disciplined and diversified approach to help control risk.

We all like a win, and betting—when legal—could provide an instant thrill. I get that. With investing, you're not in it for the thrill, you're in it for the potential of long-term growth.

• Investing uses money to make more money. As your investments grow in value, that growth can compound, which could lead to positive gains over time. Here's an example: Let's say you bet $150 a month. What if you took that same amount and invested it in the stock market? Assuming a 6% return with compounding, in 25 years that amount could grow to $101,936.

  Time is an essential ingredient in investing, and it can often help smooth out market volatility. That's why when you have a long-term goal like a down payment on a house, paying for a wedding, a child's education, or your own retirement, investing can be especially important.

• Sports betting is generally short-term by nature. You place a bet, and within hours, you could win or lose. There's no compounding, no growth—just a quick outcome, which may or may not be in your favor.

Key difference: Investing is a long game. It's designed to reward patience. Over time, your money has the potential to grow through the power of compounding returns. The longer you stay invested, the more opportunity there is to build wealth. And the earlier you start investing, the more time is on your side.

We live in a time of instant gratification. And sports betting fits right in. Place a bet now and there's the chance—no matter how slim—for an instant return. Invest now and although you have a reasonable potential for gain, you generally have to wait to get a return.

I understand it's sometimes difficult to delay gratification. But it's a habit worth cultivating, and something I try to teach my 7-year-old son. For instance, he really wants more screen time. I tell him he can have 15 minutes of screen time now, but if he takes time to read for half an hour, he can have 30 minutes of screen time later. I want him to learn that accepting delayed gratification can offer a better return. The same goes for investing.

• Investing is intentional. It's about setting financial goals, doing your homework, and sticking to a plan with the potential of future gains.

• Sports betting can feed off emotion—impulse, excitement, and the thrill of a win.

  Consider some real-life financial consequences. An increase in betting often leads to greater financial instability, higher credit card balances, and more frequent overdrawing of accounts, according to a 2024 Study, Gambling Away Stability: Sports Betting's Impact on Vulnerable Households. The same study saw a 14% decrease in investing after a state legalized sports betting.

Key difference: Investing can reward planning, discipline, and consistency. Gambling could encourage chasing losses, overconfidence, and impulsive financial decisions.

Sports betting can be fun—and tempting. But to me, it's not the way to build financial security. And it's definitely not a substitute for investing.

• Investing, while not risk-free, can offer a way to pursue your financial goals and help create a path to long-term financial growth. Consider that a 20-year investment in the S&P 500 has historically yielded a positive return 100% of the time. Some years, the stock market returns more, some years less, but over time it has historically trended higher.
• Sports betting, like gambling, is a game designed for most people to lose. Over time, gambling always has a negative expected return, according to research from the CFA Institute. Even if you win a bet occasionally, the odds are rarely in your favor.

Key difference: If your goal is long-term financial security, investing—with a clear plan and a long-term mindset—is generally the better way to go.

With any kind of betting, the odds are against you, and most people lose over time. Investing over time can have much different outcomes. As a financial professional, I've had the privilege of helping people retire successfully after following a long-term investment plan. I'd say choose the path that can help build your future, not one that bets against it.