Q&A of the Day – What Percentage of Sports Bets Lose Money & How Much?

Most recently, the average American who’s gambled on something over the past year has lost an average of $750 doing so. That’s a number that factors in the few who come out on top. And so how few is it? What percentage of people who gambled over the past year came out on top in the end? The answer is...4%. Yes, the old saying about the “house always wins”, most certainly still applies.  

Episode Transcript

Speaker 1 (00:03):
Have a question or topic. If you want to have addressed,
just ask. This is the Brian Mud Show. Today's Q
and A. What percentage of sports bets lose money? How
much too? But actually I'm going to go deeper into
sports bets because where this question go is going takes
us additional places. This is always brought to you by
Melissa and Ashes check Mark Collections, and each day I

(00:25):
feature our listener questions sent by one of these methods
to be Email me Brian Mud at iHeartMedia dot com,
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for future Q and A. Today's note this love the show.

(00:48):
Here's one for the Q and A. Something I find
annoying is that I see in here many people who
complain about the cost of living but bet on sports
and play the lottery. We know they're losing money on
the lottery. Probably aren't sports betting too. My questions are
these how many people actually win and how much money
are people losing playing these things? Okay, good stuff, good

(01:11):
stuff here, And I immediately thought of my friend Greek,
who makes a living talking about this stuff and making
sports betting picks. And he'll be the first to tell
you just about everyone who plays loses. And he's right.
You know what, the proliferation of sports betting, we have
a record amount of people gambling and losing record amounts

(01:32):
of money. So about that in addressing your questions. According
to the National Council on Problem Gambling, a record of
nearly seventy percent of adults are gambling that is through
lottery playing, sports betting, casino, online gambling, fantasy sports annually.

(01:54):
And a potentially fun fact, did you know that the
US is not the top country for gambling? Now that
happens to be Australia. We're about seventy eight percent of
adults gamble. Anyway, back to the United States and the
question at hand, So the percentage of Americans gambling is
about ten percent higher than a decade ago and is

(02:14):
mostly driven through the proliferation of sports betting. Here are
the most recent estimates of the percentage of adults that
are gambling. Fifty five percent of adults will play the
lottery during a given year. Twenty seven percent will bet
at a casino. I'm surprised it was that highs over

(02:35):
our quarter. Sports betting is next at twenty five percent.
I bet that passes casino betting before long, and a
lot of the country still doesn't have it. Online gambling
is at eighteen percent. Participation fantasy sports thirteen percent. So
the first thing that jumps out in this analysis is

(02:58):
that the average person who regularly gamble on something gambles
in multiple ways. For example, my initial analysis shows that
approximately ninety seven percent of people who bet on sports
within the past year also bet on other things too.
It might be as simple as point in the lottery,
it could be a casino what have you online? So
to the point of today's question, that potentially magnifies the

(03:21):
losses that people incur during the course of a year,
because it's not just one way they're playing to losing money.
So to break that down into dollars and cents, here's
what that looks like by type. If we go and
we take a look at the various different forms of
gambling and the average annual losses for somebody who participates.
For a fantasy sports player, the average person will lose

(03:44):
seventy five dollars doing it in a year. For the
average lottery player, they won't lose two hundred and fifty
dollars a year doing that. The average casino gambler will
lose four hundred dollars at the casino. Now you up
to sports betting, and it really rams up the losses.

(04:04):
Sports betting double the casino losses at eight hundred dollars.
The average person betting on sports during the year will
lose eight hundred dollars doing it, and the biggest of
all is online gambling, with an average one thousand dollars
loss per year. So what this shows is that the
fastest growing forms of gambling, sports and online betting, which
not coincidentally are also the easiest and most convenient to do,

(04:26):
are also linked to the higher losses as well, and
it underpins the point of today's note about people betting
on sports and then turning around and complaining about the
cost of living. For example, So about that most recently,
the average American who's gambled on something over the past
year has lost in average of seven hundred and fifty
dollars doing so. And that's a number that factors in

(04:48):
the few who come out on top, as well as
for how few that actually is. What percentage of people
who gambled over the past year came out on top
in the end? What do you think? What do you think?
The answer is four percent? Four that's it. So he
has the old saying about the house always wins most

(05:08):
certainly still applies. What's unclear in the data at this
stage is how many people are quote unquote playing for
fun versus how many are actually gambling thinking that ultimately
they're going to be able to pay the bills by
doing it. You know, just as there are people struggling
financially who play the lottery thinking, hey, you know what,

(05:32):
that's going to be my ticket out of my struggles,
they're likely some who are betting on sports and other
things trying to do the same thing for that reason.
Even though it's almost always the case that the bets
they're placing will lead to more financial challenges in the end,
it may seem logical to them. Most recently, eight percent

(05:53):
of all adults who have engaged in betting behavior have
done so in a way that is endemic of having
the gambling problem. In other words, greater than eleven percent
of all Americans who bet on anything likely have a

(06:14):
gambling problem, and that's also a number that's growing as
gambling grows across the country. While all gambling has the
potential to be addictive to those who are susceptible to it,
the early returns for sports betting suggests the overall percentage
of those who get hooked might be higher, and that's

(06:34):
due to the nature of that whole type of gambling.
Most people who played the lottery, for example, I mean
they know they're not going to win. Most people who
go to casino are only hoping to win. But most
people who bet on sports, when we take a look
at the psychology of these things, they expect to win.
The expect it by definition, I mean on average, if

(06:57):
you're not playing parlays, which by the way, increasingly people
are doing, which leads to a lower win percentage and
higher losses. By the way, but just those that do
a straight up bet, you're going to win half the
time if you're just playing the averages right, So that
creates the positive feedback loop that keeps people coming back
for more. However, The problem is you can't win half

(07:22):
the time and not lose money. About ten percent of
the winnings known as a whole percentage, go to the house.
So what this means is that just in order to
break even, you have to be winning over fifty five
percent of the time, and that's why almost no one

(07:44):
ever wins in the end. So yeah, your best bet
not to make one, especially if the cost of living
is already proving to be challenging.