There has been an on-going discussion about the effect that time and money spent on games has on the rest of your life. Real scientific data on the subject is sparse, and there is a lot of sensationalism instead and talk of "addiction". So as I don't have a statistical study on the subject, I can only offer an in-depth analysis of the one case I know perfectly well: Myself. What damage did games do to my life?
The reason why the damage of games is so difficult to assess is that there is no simple black & white answer to the question of how much time spent and how much money spent is still reasonable, and how much is excessive or damaging. Games are not like drugs, where you can with some certainty say that using heroin once is already too much; it is more like alcohol, where a lot of people consume alcohol regularly without any problem, and a few people become alcoholics and damage their lives with it. Furthermore different people at different points in their lives have different amount of disposable income and free time. As long as you only spend the money and time that you have plenty of, which you would otherwise have spent on a different form of entertainment, I would consider games to be not damaging at all.
I am 50 years old, and I have played games since I was a little kid. Of course not computer games, they weren't available yet when I was a kid. I was already in my teens when we got the first console, playing Pong in black and white. My first "home computer" was a ZX81 with 1 kilobyte of RAM. So my gaming career started with board games. My first "fantasy" game was Talisman in 1983. From there I went to pen & paper role-playing games.
I can't think of any damage games did to me during my childhood and teenage years. I finished high-school with the second highest grades in my class, and unless you want to nitpick and claim I could have had the highest grades if I had played less and studied more, I don't see any evidence of damage. I certainly didn't spend anything but disposable income on games, because as a teen all your income is basically disposable as long as you live with your parents who pay for all the essential stuff. I could even make a case that I used to be bad at English, and then suddenly developed an interest in the language due to Advanced Dungeons & Dragons, 1st edition, being only available in English at that time; so somewhere games even helped with my education. Even computer games were often educational, as magazines printed the code in BASIC and you had to type it into your computer and learn a bit of programming in the process.
This changed during my college / university years. In the early 90's I discovered that I could access LPMUDs via the university's main frame computer. It was basically MMORPGs as text adventure, but already having levels and being played online and with multiple players living in somewhat persistent virtual world. I am pretty certain that without LPMUDs I would have finished university at least a full year earlier. That basically cost me one year of life earnings. If you start working later but have to retire at the same age you can say you lost your *last* year of earnings, and that for me is a number in the 6 figures and a substantial financial loss. But this also shows how time and money aren't completely independent from each other, I wasted my time and ended up losing money. So this is probably the biggest damage that games ever did to my life and ever will. If there is any lesson to be learned from me here it is that during college / university gamers are at their most vulnerable to damage from games. Procrastination from students is nothing new, but games can be a major time sink, and it is very easy to spend too much time on them in a period of your life where you have a great degree of control over your time and little supervision.
During my Ph.D. I was already earning some money as a teaching assistant. And that was the period where I spent the largest percentage of my income on games: I had gotten into Magic the Gathering, and bought around $1,000 worth of cards per year at a time where my income was barely at subsistence level. I only got a fraction of my money back years later when I sold my collection of cards. My disposable income today is much higher, but there still isn't a single game in my life on which I spent as much money as I did on Magic the Gathering.
Once I started working a job with regular hours, games stopped to be damaging to my life. My disposable income rose, and it turned out that many games, especially computer games, are relatively cheap entertainment. I am spending less money per year on games, even if you include hardware which isn't used exclusively for games, than I would spend on an annual golf membership or other comparable hobbies for grown-ups. And I play only during my free time, after having dealt with all time requirements of work, family, and other real life stuff. That still leaves me 20+ hours of gaming per week with no discernible damage to my life.
As I said, my story isn't necessarily representative for everybody. But there are lessons to be learned here: Wasting time is frequently a danger when your life doesn't have structure; if you are supposed to organize your time yourself because you are a student, or because you are in the process of looking for a job, it is easy to err and assign too much time to entertainment and not enough to real life. Once you have a 9 to 5 job with a boss who watches over your work hours, and family at home which doesn't hesitate to demand your time in no unclear language, there are more obstacles that prevent you from wasting too much time.
Personally I consider a waste of time on games a much bigger danger to a life than a waste of money on games. Of course that does not include gambling. Board games and computer games are low-cost luxury items compared with many other alternatives. Games are in the cheap category together with activities like watching TV or reading library books. Many other sports or hobbies are a lot more costly. But this is from the perspective of a middle-class professional with a regular income, and there are certainly people for who a console plus games isn't really affordable. I just don't think these people are reading my blog.