Q: I'm sure this has been asked of you before, but I wanted to know what Biblical rationale can I use to invest in the stock market? I was thinking this morning about my 403(b) plan and how it is very aggressive with stock. Stocks are risky, and that means taking a gamble. How is investing in the stock market any different from going to Vegas and gambling?
A: I think that the stock market investing done the wrong way could be the same as gambling. As managers of what God has given us, He has charged us with the responsibility to be prudent when it comes to decision making with money. Let's start by looking at the definitions of gambling and risk and compare their differences and similarities.
Gambling, according to Wikipedia, is the wagering of money or something of material value on an event with an uncertain outcome with the primary intent of winning additional money and/or material goods. Typically, the result of the wager is evident within a short period. Risk can be defined as the probability that an action or event will negatively or positively affect a person's financial goal. When you take the risk, there is either a high or a low probability that you will make or lose money.
When you gamble with God's money, you are taking the ultimate risk because, in most cases, you put yourself in a situation where the probability is high that you will lose it all. More importantly, we have to look at why we gamble in the first place. We bet because of the desire to make a quick buck or greed and are willing to put it all on the line. We want to get as much as possible for doing as little or nothing in a short amount of time. The Bible doesn't specifically address gambling. However, Christ warns us about the chief reason we gamble which is greed.
"Beware and be on your guard against every form of greed" Luke 12:15.
So, you have to look at why you are investing. If your motivation is to make as much money as quickly as possible, and you are willing to sacrifice or take the ultimate risk to do so, then you are gambling more than you are investing. You have to stop and check your motivation. Is this about greed (earning something for nothing in a short-time period with the potential to lose it all), or is this about taking care of future financial goals for you and your family (1 Timothy 5:8)? It is all about how you approach risk when it comes to investing. Are you taking high risk, high stakes risk, or reasonable risk where you're putting your money in a place where it can work for you?
Remember, we take the risk because we want to make our money work harder for us. If we had all of the money in the world, you would not need to take the risk. You could have the luxury of putting your money in "riskless" investments. When you take a risk, you have the choice to either gamble or approach it like a prudent steward.