What is bankroll management?
Basically this can be demonstrated in 3 stages:
- Specify a budget for how much money you are prepared to risk losing betting on sports (remember be realistic with this budget and do not put your financial situation into jeopardy by setting aside more money that you can genuinely afford to lose (you need to look at the worst case scenario here).
- Establish a set of rules that determines how much money you are going to stake on any bet. The rules you abide to should be based on your budget, the way you bet, and your betting goals.
- Make sure you apply and stick to the rules outlined in stage 2 on every single bet placed.
The most important aspect of all of this and for it to work well is that you are committed to sticking to the 3 stages and that you are responsible with your money and rational in your decisions.
What makes bankroll management so important?
Bankroll management (if done right) helps you gamble responsibly. When your bankroll strategy is applied properly, it ensures that you bet within your means. Never bet more than you can lose. This alone makes bankroll management extremely important, as no-one should ever gamble with money that is needed to pay rent/mortgage or other essential living expenses. The list of valuable benefits of using effective bankroll management goes on… Such as ensuring you don't chase losses when already on a losing streak and in the reverse scenario this prevents you from getting carried away and then staking too much when on a winning streak, in essence it enables you to make better decisions with your betting.
How to withstand losses
With a proper staking plan in place, ie. you are following the 3 stages above, the amount you stake will always be linked in some way to your bankroll. If you bankroll starts to decrease (because you have lost a few bets for one reason or another) then the amount you stake will decrease also. This will prevent you from losing too much money too quickly.
If you are betting with the goal of making a profit, by placing bets this way you are protecting your bankroll and ensuring that you don't just lose it all in one swoop so to speak, if you wagered a bet the same size as the previous ones, once you balance had decreased then you risk going bust and needing to deposit again, which defeats of the object of bankroll management.
If betting is nothing much more than a form of leisure activity for you, sticking to the plan will make your bankroll last a lot longer and will effectively provide more and longer lasting entertainment for the same amount of money.
In summary bankroll management is vital towards helping you increase your chances of making long term profits and avoid making reckless wagers to chase losses. They key to all of this is discipline, this is essential for bankroll management to work. If you can stick to a staking plan and practice good bankroll management then betting on sports will be a much more enjoyable experience for you!