OPINION:
With stock market fluctuations and cost-of-living concerns, the last thing older Americans need is more pressure on their retirement accounts.
Yet the rise of prediction markets is deceptive and draining many retirement savings, as seniors and others pour money into platforms that are little more than gambling disguised as investment.
The growth of prediction markets is exploding as Americans are expected to wager a record $3.3 billion on this year’s March Madness, an increase of 54% in just three years. An additional $150 million in March Madness wagers is forecast for prediction markets.
Online sports betting is legal, sanctioned by the Supreme Court, regulated by state and tribal entities, and clearly defined as what it is: gambling. The industry has safeguards against problem gambling and age minimums.
Not so for prediction markets. Platforms such as Kalshi and Polymarket are legally dubious and financially dangerous, misleading American consumers into thinking they are trading or investing when what they are really doing is gambling.
By conflating sports betting and financial decisions, prediction markets are rebranding gambling as “event contracts” regulated like commodity markets.
It’s little wonder that investors’ focus on prediction market platforms “has the financial industry on edge.”
These concerns are especially troubling for those closest to retirement: our nation’s senior citizens. At the 60 Plus Association, part of the new Gambling Is Not Investing coalition, much of our focus is on retirement security for seniors.
With many older Americans struggling to meet basic needs on fixed incomes, we feel obligated to raise awareness about the dangers of prediction markets and encourage seniors to focus on safer ways to increase their retirement accounts.
Prediction markets are exchange platforms where people trade event contracts based on their predictions of future events.
The markets “exploded” last year, with billions of dollars pouring into Kalshi and Polymarket. Users bet primarily on sports, but also on elections and current events such as the U.S. war with Iran.
Since early 2024, monthly active users of prediction markets have surged from 4,000 to 612,000, according to a 2025 report from Keyrock and Dune Analytics.
Yet the growth has triggered concerns that these so-called markets are misleading consumers. Though they clearly constitute gambling, prediction markets are regulated as financial instruments by the federal Commodity Futures Trading Commission rather than by state gambling agencies.
This disparity has helped them confuse consumers “by promoting sports betting as an investment rather than entertainment.”
As a result, 28% of sports event contract bettors on prediction markets describe their activity as investing, while 25% fund bets from their investment budgets, according to a recent study by the American Gaming Association.
Yet they aren’t investing; they are potentially gambling away their futures, recent research shows.
As 401(k) Specialist, a digital trade publication for retirement plan advisers, put it: The surge in sports betting “can come with a real financial cost as money spent on wagers is money that does not go to legitimate investments — including 401(k)s or IRAs.”
A 2025 paper from the University of California, Los Angeles, Anderson School of Management, for example, found “a substantial increase in average bankruptcy rates, debt sent to collections, use of debt consolidation loans, and auto loan delinquencies” in states that have introduced online sports gambling. Online sports betting has proliferated nationwide since the Supreme Court effectively legalized it in 2018.
The impact on retirement savings is clear: A record 6% of Americans tapped their 401(k)s for hardship withdrawals to cover immediate financial needs last year, even as overall balances rose.
Financial experts warn that such withdrawals, which can be subject to income taxes and penalties, substantially reduce potential savings over time.
That’s the last thing seniors should be risking, especially at a time of stock market volatility and growing concerns about the affordability of everyday items.
So amid the excitement of March Madness and the temptation to throw in a few bucks, here are some words of caution: Seniors should think carefully before giving their hard-earned money to prediction markets that exploit them with shady marketing and misleading claims.
Gambling on March Madness, after all, is not investing for your retirement.
• Saulius “Saul” Anuzis is the president of the 60 Plus Association, also known as the American Association of Senior Citizens.
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