Gen Z loves 'alternative' investing. Or is it gambling?

Younger Americans are flocking to high-risk "alternative" investments successful 2026, driven by the condemnation that crypto, meme stocks and prediction markets offer better odds for gathering their fiscal goals.

Gen Z and millennials are gripped by a pervasive consciousness of fiscal nihilism that pushes them into risky investments, according to Northwestern Mutual's Planning & Progress Study 2026.

Three-quarters of millennials and 80% of Gen Zers who take risky investments feel "financially behind," the survey says. They believe speculative investments "will assistance scope fiscal goals much efficaciously than accepted methods," specified as conventional stocks and bonds.

But immoderate high-risk investments are much akin to gambling, investing experts say, and the losses tin spell beyond money.

In 1 high-profile case, a U.S. Army Special Forces worker who participated successful the raid to capture former Venezuelan President Nicolás Maduro faces charges successful transportation with placing bets connected the top-secret cognition connected the prediction marketplace level Polymarket.

Crypto is arguably the astir fashionable "alternative" investment. Among all U.S. adults, 24% are invested successful crypto oregon considering it, according to the study. That fig rises to 32% for Gen Z and 35% for millennials.

But crypto is conscionable 1 of the riskier investments drafting accrued attention.

Younger investors are into options trading and different "alternative" investments, immoderate of them risky, according to a survey from Northwestern Mutual.

Smaller but important shares of young adults are drawn to 3 different categories of high-risk investments: sports betting and prediction markets, options trading and alleged meme stocks. Here’s the breakdown:

• 32% of Gen Z and 24% of millennials are invested successful oregon considering sports betting oregon prediction markets.

• 18% of millennials and 17% of Gen Z are invested successful oregon considering options trades.

• 14% of Gen Z and 13% of millennials are invested successful meme stocks oregon are considering it.

All of those categories are dominated by younger investors, Northwestern Mutual reports. By contrast, less than 10% of babe boomers are dabbling successful immoderate of the four high-risk investments. The study draws connected a survey of 4,375 Americans successful January.

The occupation with immoderate "alternative" investments, experts say, is that they aren't truly investments.

"I specify investing arsenic thing with an expected affirmative return," said David Gardner, co-founder of The Motley Fool. "The expected instrumentality for immoderate sports bettor is negative. And there's nary mode astir that."

Investors successful crypto, meme stocks and prediction markets thin to beryllium male, according to research and anecdotal evidence. They mightiness get lured successful by YouTube oregon TikTok videos from different young men bragging astir their winnings, often with an entreaty to masculine virtues of bravery and derring-do.

"There’s a batch of beingness connected societal media of radical showing a palmy lifestyle, and that gives a fearfulness of missing out," said Tim Procita, a wealth absorption advisor astatine Northwestern Mutual.

"I perceive the word 'cheat code' a batch erstwhile radical telephone successful to speech to me," Procita said. "I deliberation a batch of radical deliberation of these alternate assets arsenic a cheat code."

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The idiosyncratic concern manufacture has been abuzz with speech of alternate assets and diversification, inspired in portion by a spreading content that stocks and bonds, alone, mightiness not suffice to present large returns for a retail capitalist successful the 2020s.

The Trump administration has pushed for American status savers to gain entree to alternate investments, including backstage equity and crypto. That propulsion is feeding statement connected whether those perchance risky assets beryllium successful status accounts.

On April 25, President Donald Trump is expected to present the keynote code astatine a crypto league astatine his Mar-a-Lago Club.

Younger investors look peculiarly receptive to concern alternatives, a uncovering echoed successful erstwhile studies.

A survey of affluent americans, published successful 2024, found younger and older investors sharply divided on which investments they considered the strongest opportunities for growth. Older Americans, ages 44 and above, mostly favor stocks, the survey found. Younger investors similar alternatives, including crypto, existent property and backstage equity.

The Northwestern Mutual survey covers concern sectors that mightiness not ring familiar to galore older investors.

Here’s a rundown:

By now, astir Americans are at slightest passingly acquainted with cryptocurrencies. They are integer currencies. Unlike currency successful your wallet, they aren’t mostly backed by a authorities oregon bank, nor by immoderate "real" asset. Bitcoin, the best-known cryptocurrency, debuted successful 2009.

Crypto investors utilized to bargain and merchantability connected crypto exchanges, a imaginable deal-breaker for those unfamiliar with bitcoin. In 2024, national regulators cleared the mode for mean investors to bargain and merchantability bitcoin ETFs, opening it up to the broader investing public.

Bitcoin’s value plunged in precocious 2025 and aboriginal 2026, but the currency has posted spectacular gains over its little existence.

"Even with crypto prices fundamentally chopped successful fractional from their highs, it is inactive a meaningful plus that volition beryllium a portion of our fiscal infrastructure for the foreseeable future," said Caleb Silver, exertion successful main of Investopedia, the fiscal journalism site.

Cryptocurrency is simply a fashionable "alternative" investment, particularly with Gen Z and millennial investors.

Americans have bet astir $450 cardinal connected sports successful the years since a 2018 Supreme Court determination that efficaciously legalized sports betting, Investopedia reports.

Prediction markets alteration investors to wager on the result of astir anything. "To beryllium capable to predict, will the Fed rise involvement rates oregon not this month?" Procita said. "Or, will lipid prices beryllium supra $100 a tube oregon beneath $100 a tube astatine the extremity of the month? ... Who’s going to triumph 'Survivor'? You tin enactment wealth connected that."

Investors can tap prediction markets connected sites specified as Coinbase, Robinhood, Polymarket and Kalshi.

The sports betting and prediction markets blur the enactment betwixt investing and gambling.

"You’re betting connected an outcome, with the hopes of turning a speedy profit," Silver said. "And that is precise antithetic from investing for the agelong term, wherever you’re not betting."

Remember when the GameStop stock soared during the COVID-19 pandemic amid a flurry of social media posts?

A meme stock "is typically a institution whose stock terms gets bid up irrationally by retail investors who are trying to popularize it and broaden its attraction to much retail traders to marque a speedy profit," Silver said.

Meme stocks instrumentality disconnected "not based connected their fiscal performance, but conscionable based connected hype," Silver said. Some meme stocks person risen 1,000% oregon more.

"And each of them person travel crashing to Earth," helium said.

GameStop shares roseate dramatically successful a surge of "meme stock" investing during the COVID-19 pandemic.

An enactment gives the purchaser the close to bargain oregon merchantability an asset, specified arsenic a stock, astatine a acceptable terms by a acceptable date.

Options tin hedge against a sinking banal market, Investopedia reports. Savvy investors tin usage options to bargain stocks astatine a discount, or to support their holdings from a terms drop.

"Options trading is betting connected terms and learning however to recognize hazard and reward," Silver said. "But if you bash it without learning however the options marketplace works, you are going to suffer wealth 100% of the time."

Michael Loria contributed.

This nonfiction primitively appeared connected USA TODAY: Gen Z, millennials flock to high-risk 'alternative' investments