‘Super Bold’? Avoid Financial Injury Amid This Year’s Sports Betting Bonanza

The Super Bowl has always been a big day for advertising, but this year another industry is gearing up for record-breaking profits – gambling.

Over 50 million Americans plan to bet on this weekend's showdown – more than ever before.

According to the American Gaming Association, bettors are expected to wager a record $16 billion on the showdown between the Chiefs and Eagles, more than double last year's projection. This splurge is largely facilitated by the precipitous rise of betting apps launched since The Supreme Court's landmark ruling in 2018 legalizing sports betting for states.

Clinical psychologists treating gambling addiction report a shift in their client base from older, poorer punters that frequent casinos to young, well-paid young men hooked on sports betting. This post will look at how gambling in America is undergoing a technological and demographic shift and ask some financial experts for advice for young people on how to limit the excesses of sports betting.

Betting Big

Since June 2018, Americans have wagered a total of $190 billion on sports, according to data from Legal Sports Report, which keeps track of revenues generated across the country. Currently, just over half of all states have legalized sports betting. The five states with the highest rates are New Jersey, with $34 billion in revenue since 2018, Nevada ($30 billion), Pennsylvania ($19 billion), New York ($17 billion), and Illinois ($18 billion).

“It's still very early days… this space has exploded recently and will continue to grow as states pass legislation to make it legal in their state,” says Tim Uihlein, Partner at Vincere Wealth Management.

A string of new apps has made betting on live games more accessible. Most connect and sync directly with users' bank accounts to enable quick and easy deposits, and as a result, they often lose track of how much they're up or down.

The apps are attracting a new gambling clientele – young, college-educated men with high incomes. Research from 2022 shows this demographic is more likely to bet on sports than other Americans.

Many of these young men are already avid sports fans who get introduced to the sportsbook apps via ads airing during televised games. Psychologists note their familiarity with their favorite sport often gives them the confidence they can “beat the odds” in predicting specific outcomes. Peer pressure and a desire to bond with male relatives and friends are also nudge factors.

'Super Bold'? Avoid Financial Injury Amid This Year's Sports Betting Bonanza
Image Credit: Wpadington/Shutterstock

“These apps make it very accessible to make bets without a lot of knowledge on how it works. I would recommend doing your own research so you know what you are getting into before you make a deposit,” says Uihlein. “It's important to be aware of how the sportsbooks try to get people to come back and bet more through various referral bonuses, boosted bets, and ‘risk-free' bets to get you to come back.”

It's key to understand the terms and conditions that lie behind these promotions.

Depending on the promo, a rollover may apply, meaning you must wager a certain amount at that sportsbook before you can withdraw. Others require you to win back your initial deposit before withdrawing.

For instance, FanDuel offers a risk-free be of up to $1,000. Yet, as sports betting education platform Action Network explains if the rookie punter wins, they keep the winnings, but if they lose their maiden bet, their deposit is converted to more “free bets.” Yet if those follow-up free bets also lose, the bettor is left with nothing.

Play it Safe

For this reason, it is critical not to make spur-of-the-moment decisions when gambling, but to set caps before a big game and stick to them. Take advantage of the self-imposed betting limits and cool-off periods available in an app's settings.

“Most sportsbook apps allow you to set a strict limit, where it will not allow you to deposit more money if you set a weekly limit and hit that amount,” adds Uihlein. “This is a great way to actually not go over your limit, and don't snowball into trying to make back the money you lost.”

While placing a bet can add some spice to watching a big game, it's essential to moderate one's gambling. Left unchecked, this seemingly innocuous indulgence can quickly snowball into a destructive habit that could threaten one's financial security. For example, a person who starts out betting a small amount on their favorite team every game can quickly find themselves making increasingly larger bets in the hopes of making their money back, triggering a vicious spiral.

Gambling addiction remains a significant social problem in the U.S. Roughly 1% of the U.S. adult population is estimated to live with a gambling addiction, according to Yale Medicine. Yet the number of people affected by problem gambling is higher, considering the excessive toll betting takes on families. Not to mention that gamblers tend to pass on their risk-taking behavior to their children.

If you feel you are struggling to control your gambling habit, reach out to the National Problem Gambling Helpline Network at 1-800-522-4700 or via their online peer support forum at www.gamtalk.org. Assistance is available 24/7 and is 100% confidential.

This article was produced and syndicated by Wealth of Geeks.