Investing vs Gambling: What’s the Difference?

In South Africa, people are always looking for ways to grow their money. Some turn to the stock market, retirement funds, or property investing. Others head to casinos, sports betting sites, or play the lottery. 

On the surface, investing and gambling can look similar. You put money in and hope for a bigger return. But while they both involve risk, they’re very different in purpose, strategy, and long-term outcomes.

A trillion-rand pastime: gambling in South Africa

South Africa has one of the most active gambling markets in Africa. In the 2023/24 financial year, South Africans wagered around R1.14 trillion, a sharp jump from about R815 billion the year before. Gambling revenue (the amount operators keep after paying out winnings) hit R59.3 billion over the same period.

To put that in perspective, gambling now accounts for 1.6% of household spending, and more than half of all entertainment spending (about 54.5%) goes to gambling. Online sports betting and casino play in particular have grown rapidly, with income from operators surging from R10.1 billion in 2018 to over R152.6 billion in 2023.

With numbers like these, it’s easy to see why gambling is often compared to investing; both are ways people hope to make more money. But the key differences matter.

There is no “investment” in gambling

When you place a bet, whether it’s on the roulette wheel or a soccer match, you’re staking money on an uncertain outcome that’s largely beyond your control. No matter how much you study form guides or betting odds, the outcome is immediate and driven by chance or unpredictable events.

Investing, on the other hand, is about putting your money into assets like shares, bonds, or property that have intrinsic value and the potential to grow over time. The Johannesburg Stock Exchange (JSE) and South African property markets may fluctuate, but the general expectation is long-term growth, not instant wins.

The indirect effects are real

The National Responsible Gambling Programme (NRGP) reports that in 2022/23, more than 2,200 South Africans sought counselling for problem gambling. A further 1,339 applied for self-exclusion from betting operators.

Mounting debt, strained relationships, and difficulty meeting day-to-day financial obligations are common knock-on effects when gambling gets out of control.

By contrast, investing usually strengthens your financial position, provided you manage risk and diversify. Even when markets dip, the goal is to build wealth over years, not chase quick wins overnight.

Risk vs reward

The biggest difference lies in how risk is managed:

• Investing: You can reduce risk through diversification, research, and a long-term approach. Even if one share falls, another may rise.

• Gambling: The odds are set in favour of the house or bookmaker. While you might win big once, over time, the math is against you.

As South African economist Dawie Roodt puts it, investing is about “wealth creation and preservation,” while gambling is entertainment, enjoyable, but not a financial plan.

Play for fun, invest for the future

Both investing and gambling involve risk, but the intent and outcomes are worlds apart. Gambling is a form of entertainment that can cost you money, while investing is a strategy to build financial security.

For South Africans, the choice isn’t about picking one over the other; it’s about knowing the difference. Enjoy gambling responsibly for fun, but don’t mistake it for investing. If your goal is long-term financial growth, the stock market, retirement funds, or property are safer bets.