When it comes to your finances, sports betting may be one gamble you don’t want to take.
Wagering on sports can lead to poorer debt management and worse credit scores. Bettors are also more likely to increase their spending and shrink their investments, according to a pair of recent studies. The consequences are biggest among financially vulnerable populations.
What’s worse, per a third study, is that the way sports betting is evolving could make it one of the most addictive forms of gambling.
It’s time for policymakers to step in and regulate this budding betting industry six years after it was legalized in the US to help people avoid their worst impulses — before it’s too late.
“As individuals, voters, [and] policymakers, I think our results are concerning,” Justin Balthrop, a co-author of one of the studies and an assistant professor of finance at the University of Kansas, told Yahoo Finance.
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“But it’s very hard to make prescriptions before you have a diagnosis. And what I think our paper is really trying to do is get very precise estimates of exactly what the problems are.”
A sign calls attention to sports betting at Encore Boston Harbor casino Jan. 31, 2023, in Everett, Mass. (AP Photo/Steven Senne) (ASSOCIATED PRESS)
The financial consequences of sports betting
Sports betting began to take hold after the Supreme Court struck down the Professional and Amateur Sports Protection Act in May 2018, allowing states to set their own sports gambling laws.
So far, sports betting is legal through retail and/or online sportsbooks in 38 states and the District of Columbia. Revenue has jumped, growing 30.3% to $7.56 billion year to date through July from the same period last year.
In his study, Balthrop — who refers to himself as “a pretty avid and voluminous sports bettor” — took advantage of the staggered rollout of sports betting across the US after its legalization, giving him and his colleagues time to understand the before and after effects of this betting.
What he found was for every $1 deposited into online sportsbooks, those households reduce their investment allocations by $2. The doubling effect — from $1 to $2 — comes from the additional spending outside of the bets to support their gambling. Think extra streaming services or more sports bar tabs to watch games.
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Additionally, sports betting increases the number of times households overdraw their bank accounts, Balthrop found. These effects were worse for financially constrained households, which also reduced their credit card payments while increasing their balances.
“The core of this effect is taking place in households that may not have budgetary slack,” Balthrop said.
Davide Proserpio and his colleagues found similarly concerning findings in their study. Overall, the average credit score in a state fell by 0.3% after legalizing sports gambling. That figure triples to 1% if the state permitted online sports gambling.
The fact the study took the average credit score of a state’s entire population likely dilutes the real impact on a bettor’s personal credit score, Proserpio, an associate professor of marketing at the University of Southern California, said.
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On top of that, bankruptcies, debt consolidation loans, and debt collections increased in states that legalized sports betting, especially online betting — to the point that Proserpio found that lenders restricted access to credit to protect themselves. Low-income young men were more likely to be affected.
“It’s not just gambling is affecting, on average, consumer financial health,” he said, “it is also affecting a part of the population that is already low income and probably has other types of [financial] problems.”
‘A casino in our pockets’
Balthrop and Proserpio documented the consequences of sports betting, but their studies didn’t examine why this particular form of gambling can be so detrimental.
That’s where Dr. Jamie Torrance, a researcher in psychology at Swansea University in the UK, and his colleagues come in. They examined numerous studies worldwide on gambling in what’s called a scoping review and unearthed patterns to help explain why sports betting has gotten so pernicious. It comes down to three factors: access, quantity of bets, and illusion of control.
Historically, sports betting was a slow, “simplistic form of gambling,” Torrance said. To wager on a game, you had to call up a booker or walk into a betting shop. You could only bet if a team was going to win, lose, or tie. And then you had to wait until the game was over for the outcome of your bet.
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“There’s lots of research that indicates that the longer you have to wait for a gambling outcome, the less addictive and harmful the product usually is,” Torrance said.
Not anymore with sports gambling, which is instantly accessible on our phones and more akin to slot machines.
“We’re basically walking around with a casino in our pockets,” Torrance said.
New York online sports betting to launch on Jan. 8, 2022. (Photo by: STRF/STAR MAX/IPx 2022 1/7/22) (STRF/STAR MAX/IPx)
On popular apps such as DraftKings and FanDuel, bettors can wager at any time of the day, on any sport, on any game. They can bet on more than just who wins the game, too; they can put money on the outcome of the next baseball pitch or field goal kick. The options are nearly endless and the results come back faster.
“That is a big issue,” he said.
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Another major problem is that sports bettors can easily convince themselves they can beat the odds, Torrance said, providing “an illusion of control.”
They fancy themselves as sports experts. They watch all the games and read all the game reports. They may subscribe to sports newsletters with insider info. Heck, maybe they were a half-rate player a decade ago.
“Sports betting has a way of tapping into people’s misestimation of their own expertise,” Balthrop said, agreeing with Torrance.
But — like any other type of gambling — the game is rigged. The house always wins.
A man makes a sports bet at the DraftKings sports book in Atlantic City, N.J., Oct. 8, 2019. (AP Photo/Wayne Parry) (ASSOCIATED PRESS)
‘A trade-off’
Torrance’s research also uncovered how sports betting could evolve — and his two major predictions are unsettling.
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First, he expects sports betting companies to employ augmented reality. For instance, you could point your phone at a live sporting event, and the app would provide real-time odds on different bets.
Second, he anticipates these companies will provide bettors with very specific notifications based on their gambling behavior. A person could receive an alert that the star player’s mother is having surgery this week that could affect the player’s performance. Maybe the recommendation is to bet against the team.
“That kind of stuff encourages what we discussed earlier, which is the illusion of control,” he said.
This is why all three researchers embarked on these studies, to provide crucial data on gambling to inform lawmakers who — to be honest — may be swayed more by the tax revenue sports betting provides. But citizens who get themselves into too much debt or don’t save for retirement become a “social cost burden” down the road, Balthrop said.
“There is a trade-off here,” Proserpio agreed.
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Australia offers a blueprint, recently implementing ways to slow the betting process to combat those ruinous consequences. But time is ticking in the US as the sports betting industry evolves and grows.
Lawmakers in Missouri and Oklahoma have introduced bills to legalize the industry, while two Democratic congressmen this month introduced a bill that would allow the federal government to regulate advertising, bet-making, and artificial intelligence in the industry.
“I’d like to think that you guys over the pond have more time to reduce harm, but in reality, I don’t think that’s going to be the case,” Torrance said. “I think, in fact, it’s going to mirror the UK where we have lots of gambling harm.”
In other words, don’t bet on it.
Janna Herron is a Senior Columnist at Yahoo Finance. Follow her on X @JannaHerron.
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While most AI in financial services remains advisory, LUMIQ has built the layer that owns the decision — autonomous, auditable AI agents making regulated calls in production at leading banks, insurers, and capital markets firms. Today, LUMIQ serves clients across India, the United States, and Southeast Asia — leading institutions across insurance, banking, and capital markets.
NEW YORK and SINGAPORE, June 19, 2026 /PRNewswire/ — LUMIQ, an AI-native financial services company, today announced a strategic funding round to scale auto-decisioning for financial institutions across the United States and Southeast Asia. The round was led by Bajaj Finserv, one of India’s largest and most diversified financial services groups, with participation from existing investor Info Edge Ventures.
LUMIQ raises Strategic Funding to become AI decision layer for financial services
Right now, thousands of customers are waiting for a policy to be issued, a loan to be disbursed, a claim to be adjudicated, because somewhere an FSI employee is drowning in decisions, held back by the risk of getting it wrong. Today, when e-commerce delivers the same day, banks and insurers still decide in weeks. We built LiteCone to take that burden: AI decides the routine cases, completely and accountably, so humans spend their judgment on the one case that actually needs it. This round lets us bring that to every financial institution in the markets that matter most. Shoaib Mohammad, Co-founder and CEO, LUMIQ
From AI that assists to AI that decides
For decades, financial institutions have bought technology that made their people faster — faster data, faster scoring, faster copilots. The decision still landed on a human. LUMIQ is changing that. Through its LiteCone platform, the company deploys AI agents that read the file, apply the institution’s own guidelines, and reach the decision end to end — escalating only the cases that genuinely require human judgment. The output is not a recommendation. It is a decision, with full reasoning attached, cross-referenced to policy, and defensible under audit.
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The results in production speak clearly. At a leading life insurer, LUMIQ’s LEO agent decides 75–80% of underwriting cases with zero human touch, reduced policy issuance cost by roughly 25%, and compressed turnaround from days to under eight minutes — running 24×7 with complete auditability. Across its client base spanning insurance, banking, and capital markets in India, the US, and Southeast Asia, LUMIQ now processes millions of decisions annually.
LiteCone turns a real financial-services role into a working AI agent in weeks. Every agent we deploy is consistent, explainable, compliant, and auditable by design — not as an afterthought. This capital lets us go deeper on the platform and broader across roles. And through our cloud and AI lab partnerships, institutions will increasingly find LiteCone already embedded in the platforms they run today. Vaibhav Dobriyal, Co-founder and Chief Product Officer, LUMIQ
This round funds four priorities: expanding go-to-market in the US and Southeast Asia; deepening LiteCone’s decisioning capabilities; extending the agent workforce across more financial-services roles; and building a partnership ecosystem with cloud hyperscalers, AI labs, and core banking and insurance platforms so LiteCone is embedded where institutions already run.
LUMIQ’s investors backed the round for the same reason its customers adopt LiteCone: agents already deciding in production, with auditability and control built in.
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As a financial-services group, we know how much rests on getting regulated decisions right, at speed and at scale. LUMIQ has built AI agents that decide in production with auditability and control built in, the capability the industry has been moving toward. We are proud to lead this round and to support the team’s expansion across the US and Southeast Asia. Lakshmi Iyer, Group President – Investments & CEO, Bajaj Alternates
Our conviction is grounded in what LUMIQ has already built. Their AI agents aren’t just built for the future. They are operating in production today, at speed. This combination is rare, and its value will only compound as the company scales globally. Girish Jhunjhunwala, Fund Manager – PE and VC Investments, Bajaj Alternates
Financial services is one of the hardest categories to crack — regulated, risk-averse, and unforgiving of hype. LUMIQ has put agentic AI into live financial-services workflows and earned the trust of large institutions across the US, Southeast Asia and India. That is how a category-defining company in financial-services AI gets built, and we are proud to keep backing the team as they scale globally. Kitty Agarwal, Partner, Info Edge Ventures
LUMIQ’s goal is to lead one category: auto-decisioning at production scale for financial services. Agents that act, not assist, and never compromise audit, compliance, or predictability.
About LUMIQ LUMIQ is an AI-native financial services company. Through its LiteCone platform and a growing workforce of production AI agents, LUMIQ turns real financial-services roles — insurance underwriter, credit underwriter, claims adjudicator — into agents that are consistent, explainable, compliant, and auditable. The company pairs deep domain expertise across banking, insurance, and capital markets with frontier AI. LUMIQ employs over 350 AI and data specialists, and has offices in New Jersey, Singapore, and Delhi NCR (India).
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Web: www.lumiq.ai
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View original content:https://www.prnewswire.com/apac/news-releases/lumiq-raises-strategic-funding-to-become-the-ai-decision-layer-for-financial-services-302805280.html
Consumer confidence has plunged among traditionally optimistic younger adults amid fears for their personal finances and the wider economy, figures show.
GfK’s long-running Consumer Confidence Index remained unchanged at an overall score of minus 23 in June.
However, the analyst said this was was “misleading as, beneath the surface, there are new signs that confidence is weakening”.
Source: GfK
Neil Bellamy, consumer insights director at GfK, said: “The biggest fall this month is among those aged 16 to 29, traditionally one of the most optimistic groups.
“Here confidence has dropped 11 points over the past month to minus two, the lowest level seen for two years, driven by large falls in views on both their own personal finances and the wider economy.
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“More broadly, there are now no demographic groups with a positive confidence score, including higher-income households earning £50,000 or more, who have slipped back into negative territory as of June.
“Confidence remains subdued and vulnerable to further economic or political uncertainty.”
Sourve: GfK
Overall, confidence in personal finances over the coming year remained flat at minus two, four points lower than this time last year.
The measures of both personal finances and the economy over the previous 12 months were both slightly down, by two points and three points respectively, “reflecting the sense that things have been extremely tough over the last year for so many”, GfK said.
The only measure to increase was expectations for the wider economy over the next 12 months, up two points to minus 36 but still eight points below this time last year.
The major purchase index, an indicator of confidence in buying big ticket items, remained at minus 20, four points lower than June last year.
“Ships of the World, start your engines. Let the oil flow!” said Donald Trump on social media after he announced the signing of an interim peace deal with Iran on Sunday. Under the agreement – which Iran acknowledged included a 60-day negotiating period for a final deal – the president said that following retrieval of mines, there would be a “toll free opening” of the Strait of Hormuz.
But many of the finer details remain “unclear”, said The Guardian. There are questions over the “exact timing of the reopening of the maritime route, who will oversee safe passage and whether any conditions will be applied”.
Financial markets have welcomed the announcement, but further volatility could yet hit people’s pockets.
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Have oil prices changed?
The price of oil fell to about $83 (£62) per barrel following Sunday’s announcement, its “lowest since the early days of the war”. Then on Tuesday it dipped below $80. In February, before the first missiles struck Iran, each barrel cost around $73. The price peaked at around $120 at the height of the conflict.
Prices are expected to fall in the wake of a prolonged ceasefire, and there are “real grounds for optimism”, said Politico. Damage to oil-specific infrastructure has been “limited”, meaning it could take “as little as six weeks to resume outflows”.
“So that’s the energy crisis sorted, right?” Not so fast.” A combination of damage to wider infrastructure and the continued closure of the Strait of Hormuz has meant roughly 12 million fewer barrels of oil have been produced each day. And they “won’t magically reappear on the market even if the pact holds”.
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Will this continue?
The “first big test” of the deal will be whether shipping companies will have enough “confidence” to return the use of the strait to pre-war levels, said The New York Times. If successful, this will free the 250 tankers and 330 cargo ships trapped in the Gulf, according to the BBC, and transport oil around the world. Oil and gas producers in the Gulf nations would then need to re-establish “wells, refineries and other infrastructure”.
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Even if all of that were to materialise, European and Asian countries who have historically depended on oil from the region “will face a long wait”. Processing oil takes considerable time. “It is unlikely that the prices of gasoline, diesel and other fuels will return to pre-war levels anytime soon.”
What about inflation?
Despite air fares “surging” and fuel costs “tipping higher”, UK inflation remained at 2.8% in May, said The Independent. This was a “surprise” to economists, who had widely predicted a rise to 3% and “perhaps even beyond” due in part to the war in Iran.
Remaining at this level could imply that the “cost-of-living squeeze will not play out as badly as had been anticipated” earlier this year, even if the “Iran war sent energy costs spiralling”. However, prices are set to rise again later in 2026, leaving savers to make sure their investments are earning an interest rate “well above the rate of inflation”.
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What does this mean for consumers?
Food prices in the UK look to be rising more slowly. Should the Strait of Hormuz open freely, fertiliser, which has “soared in costs” and put pressure on farmers, could fall substantially, said the BBC. Jet fuel has already seen a “small fall in price”, with Northwest Europe jet fuel trading at $1,033 (£780) per tonne, compared with $831 pre-conflict and around $1,840 at its peak.
How will businesses be affected?
Beneath the “encouraging headlines” about inflation control, there is a “hidden crisis for businesses”, said The Telegraph. The Iran war triggered one of the largest energy shocks in history, meaning businesses were “swallowing soaring costs to spare shoppers”.
“Input rises” for producers climbed by “8.7% year on year in May”, larger than the 7.9% in April and the highest in more than three years. On the bright side, this means the economy may avoid a dreaded “wage-price spiral”, but conversely lower margins could lead to increased pressure on the employment market.
