Albert Einstein probably never called compound interest the eighth wonder of the world. Whether he said it or not has long been debated. Financial advisers, however, have spent decades demonstrating exactly how it works.
Small amounts invested consistently become meaningful wealth.
The Sanlam Benchmark 2026 Insights Report explores the same principle from the opposite direction. Drawing on a consumer survey of 600 South Africans across three life stages, together with research among retirement fund members, employers, and retirement funds, this year’s report examines the decisions and behaviours that shape long-term financial outcomes.
Small losses, repeated often enough, can quietly erode the financial resilience that years of disciplined saving are intended to build.
The report’s chapter on gambling explores what repeated gambling spend means for household finances. Modest, recurring bets can gradually crowd out saving, debt reduction, and long-term financial security. Individual bets may be small. Their cumulative effect is not.
Gambling is becoming a regular household expense
Half of respondents said they had spent money on gambling, betting, or lottery activities during the previous three months. Participation was significantly higher among people who are still working than among retirees, making gambling primarily a pre-retirement behaviour.
Lottery tickets and scratch cards remain the most common form of gambling, with about 72% of respondents who gamble saying they buy Lotto tickets or scratch cards.
The growth is happening elsewhere.
Online sports betting and online casino gambling each account for more than a third of gambling activity, with both heavily concentrated among working South Africans.
The survey also found that gambling is seldom an occasional activity. One-third of respondents who gamble do so a few times each month, while weekly or near-weekly gambling is also common, particularly among people who have not yet retired.
The report describes these repeated transactions as “small regular leaks” – modest but consistent spending that gradually crowds out savings. In households already under financial pressure, repeated discretionary spending, even at relatively low levels, can add up to meaningful long-term financial erosion.
Entertainment, income – or both?
Most respondents still regard gambling as entertainment. The survey found that 58% described it that way. The motivations become more varied after that.
Thirty-eight percent said they gamble to generate additional income. Others cited stress relief or attempts to recover previous financial losses. Working respondents were more likely to link gambling to cash-flow pressure, while retirees were more likely to see it as a possible income supplement.
Elsewhere, the Benchmark report repeatedly returns to the pressures facing household finances. Debt, school fees, healthcare costs, dependants, and retirement saving all compete for the same monthly income, often leaving little room to absorb unexpected expenses.
Gambling becomes another call on that same salary.
Gambling is not being funded with spare cash
The survey also asked where the gambling money comes from.
- Two-thirds (66%) of respondents who gamble said they use their salary or wages.
- Another 32% use side-hustle or gig income.
- A further 32% rely on previous gambling winnings.
- Thirteen percent reported using money accessed through the two-pot retirement system.
- Ten percent use credit cards or overdraft facilities.
- Eight percent borrow from family or friends.
- Six percent rely on bank loans or microloans.
Very little of that money could reasonably be described as surplus income.
Salary competes with groceries, transport costs, debt repayments, and retirement contributions. Credit attracts interest. Borrowed money must eventually be repaid. Retirement savings, once withdrawn, permanently lose the benefit of future investment growth.
Only a minority reported using two-pot withdrawals for gambling. Even so, the appearance of retirement savings among the funding sources illustrates the financial pressure reflected throughout the Benchmark report.
Financial stress is already widespread
More than 80% of respondents said they were experiencing financial stress.
The report links that pressure to increased absenteeism associated with stress, anxiety, and mental health challenges.
Keeping this in mind, gambling appears less like an isolated financial decision than one of several ways households respond to financial strain.
Not everyone experiences negative financial consequences. Thirty-two percent of respondents said gambling had contributed to financial stress, while 64% said it had not. Another 2% were unsure.
The report treats gambling less as a predictor of financial distress than as a possible indicator that financial vulnerability already exists. It recommends paying closer attention to recurring spending, digital gambling, and repeated two-pot withdrawals as early warning signs, with different interventions before and after retirement.
Small decisions, repeated often enough
One of the more interesting observations in the report is that retirement outcomes are shaped less by dramatic financial decisions than by everyday behaviour. Members generally want to save. Many understand the value of retirement planning. Immediate financial pressures often get in the way.
The same pattern appears in the gambling findings.
The report concludes that the real issue is not whether individuals gamble, but whether repeated gambling spend is quietly displacing saving and undermining financial stability.
Financial advisers spend much of their time helping clients to harness the power of compound growth. The Benchmark findings are a reminder that compound losses deserve just as much attention.
