Posted on: February 6, 2021, 12:03h.
Last updated on: February 5, 2021, 05:47h.
The COVID-19 pandemic, new research finds, has led to increased spending on various vices, including gambling.
The report comes from MagnifyMoney, an online personal finance website owned by LendingTree. Researchers say that since the onset of the pandemic, the average American adult has spent nearly $950 on vices.
Alcohol, cigarettes, and lottery tickets are three of the top vices. MagnifyMoney surveyed 1,550 Americans, and found that 70 percent of consumers doled out cash on vices during the pandemic.
Stress and spending have always been linked, and the coronavirus pandemic has made financial vices more alluring for many Americans,” explained MagnifyMoney‘s Devon Delfino.
Thirty-one percent of Baby Boomers, 30 percent of Gen X, and 25 percent of millennials said they purchased a lottery ticket over the past year. The massive jackpots for Powerball and Mega Millions recently lured in many players.
Online Gambling Increases
As made evident in monthly gross gaming revenue (GGR) reports in New Jersey and Pennsylvania — two states that have internet casinos with slot machines and table games — the research shows that many have spent some of their time stuck at home gambling online.
One in five millennials report making some sort of bet via the internet. So have 12 percent of Gen Xers, nine percent of Gen Zers, and five percent of Baby Boomers.
Here’s how MagnifyMoney broke down the generations:
- Generation Z: 18 to 24 years old
- Millennial: 25 to 40
- Generation X: 41 to 55
- Baby Boomer: 56 to 75
While brick-and-mortar gambling revenues crashed in 2020, as governors issued stay-at-home orders and nonessential businesses were closed, iGaming blossomed.
In New Jersey, GGR online more than doubled, internet gaming sites winning $931.5 million. Poker rake increased 85 percent to $38.8 million. Many Pennsylvanians also went online to gamble. Internet casinos won $556.7 million last year.
Only four states had licensed online slot machines and table games last year. Along with New Jersey and Pennsylvania, West Virginia and Delaware have regulated iGaming. Michigan’s online gaming platforms went live last month.
Financial Stability During Pandemic
The MagnifyMoney survey was to gauge how Americans are handling their finances amid the heath crisis. Tens of millions of people in the country were furloughed last year.
MagnifyMoney found that 4 in 10 Americans used money from their savings account to cover vice spending.
“People have just been bombarded by stress continuously for the past year, and many people lean on their vices to help them through really difficult times,” said Matt Schulz, LendingTree’s chief credit analyst. “It’s troubling because these vices can often do far more damage than good, but I also totally understand why people fall back on them.”
Four groups spent more than $1,000 on vices last year. Millennials spent $1,258, people making over $75,000 a year from their job ($1,258), and men in general ($1,138). Most concerning is that those who were furloughed or laid off spent the highest at $1,415.
“If you’re tapping into savings and going into debt to pay for one of your vices, it’s possible that you could be struggling with a very real addiction. Whether that addiction involves drugs, drinking, online shopping, gaming or something else, it is a very serious thing and you should look into getting help,” Schulz concluded.