Bankroll Management in Sports Betting: A Complete Guide

Part of a positive sports betting experience, and perhaps the most important factor that is oftentimes overlooked, is knowing how to manage your bankroll.

Sportsbooks stay in business for a reason, and it’s not because they’re giving away money; proper bankroll management is necessary in mitigating losses.

Luckily, there are strategies and best practices that can help make managing your bankroll more enjoyable.

What Is Bankroll Management?

Much like managing a budget for everyday expenses around the home, bankroll management is your budget for betting on sports. The plan for paying bills at home should also be used for different hobbies.

If betting on sporting events is one of those hobbies, keep your personal finances and sportsbook bankroll separate, and make sure you never bet more than you can afford to lose.

That phrase will be used a lot, but it’s a simple rule that will help withstand the uncertainty of sports betting.

Setting Up Your Bankroll

The size of a bankroll will vary between individuals, but the practices used to establish it will be the same.

Your bankroll should be funded with money you can afford to lose without impacting day-to-day life, much like setting money aside for a cruise to the Bahamas or a golf trip to Augusta.

This can be done with a set sum of money you are comfortable setting aside or a small percentage of your savings.

Decide Your Betting Budget

Several factors need to be addressed when deciding on a budget.

First, disposable income plays a significant role. Determine how much money you can comfortably set aside without it impacting your personal finances.

Also, determine your betting goals. If betting for fun, a smaller bankroll might be a better option. Experienced and professional gamblers might prefer a larger budget.

Gambling is a risk, so if you're averse to risk, opt for a lower budget.

And here’s that phrase again: never bet more than you can afford to lose.

Tracking Your Bets

Winning most of your bets sounds good, but with different amounts wagered and shifting odds, a win percentage means nothing.

Bet tracking is a key tool because it allows bettors to evaluate their skill and potentially identify strengths and trends. Make a detailed list of each wager, including: the date, sport or league bet on, amount wagered, odds, the final result, and the amount won or lost. This tracks your progress and can help identify useful trends that can increase your chances of making money.

Bet tracking is time-consuming, but the potential benefits are worth the time.

Unit Sizing and Risk Management

Breaking your bankroll into units is an essential bankroll management strategy. A unit is typically a set amount or a percentage of your total budget and is the standard amount you should bet on any event.

Units can help bettors more effectively manage their bankroll, so they know exactly where they're betting their money.

What Is a Betting Unit?

As mentioned, a unit is the amount used to place bets. The exact number varies depending on the percentage or total sum and the size of your bankroll. If you have a bankroll of $1,000 and decide on a unit rate of 1%, the unit amount is $10.

Ideally, one unit should be 1% or 2% of your total budget. Beginners should start at the low end, but the number can change over time. Of course, you can pick any number, but a lower percentage helps protect the bankroll.

Flat Betting vs. Variable Staking

Sports bettors commonly ask which bankroll method they should use: flat betting or variable staking.

Properly managing your bankroll is a key to success, and figuring out how much to bet on an event is part of that management.

There are advantages and disadvantages to both flat betting and variable staking, and there is no consensus as to which method is better or more profitable.

Flat betting removes emotion from the equation, with the same amount wagered on each event. Variable staking is changing the size of your wager for each bet, with the fixed profit model being the most common plan.

Avoiding Chasing Losses

One common road to a diminished bankroll is chasing losses. Oftentimes, we see bettors on a losing streak, and, thinking that their luck will change, they alter their betting strategy.

Instead of sticking to the plan, they throw down a bigger stake than allotted, hoping to make up some of their losses.

Chase bets are often motivated by emotion, with a greater likelihood of losing.

When experiencing heavy losses, it’s good to take a break. Developing discipline during a losing streak can help you avoid losing even more money.

Popular Bankroll Management Strategies

When to bet and how much to wager are common sports betting questions.

The novice gambler isn’t overly concerned with bankroll management since many wagers are one-time risks.

Yet, there are a number of strategies that can be employed to help manage your bankroll and that can play a role in determining long-term success.

Kelly Criterion

Advanced analytics are taking over sports, so why not a similar approach to betting?

The Kelly Criterion is a complex mathematical formula that offers bettors a good indication of how much to bet in any situation, accounting for the probability of an outcome against the odds offered.

In theory, the more perceived value, the higher the bet. In simple form, the Kelly Criterion will multiply the chance to win by 2.

If a bet has a perceived 70% chance to win, that’s 0.7 x 2 for 1.40. Subtract 1 from that number and you have 0.4, which is 40% of your bankroll.

The method recommends not "betting with no" or negative value.

Percentage Staking

The percentage stake method is a simpler way of managing your bankroll and allows variations.

Bettors wager a percentage of their bankroll, with the numbers becoming more flexible depending on profit or loss. This allows bettors to adjust to fluctuations instead of using the fixed stake method. When a bettor gets on a heater or is confident about certain bets, a larger sum can be staked to increase potential returns.

Also, smaller bets can be placed during a slump to protect your bankroll from heavy losses.

Stop-Loss Limits

To promote responsible gambling, set limits on your wins and losses over a predetermined time.

A loss limit is the most a bettor can lose without impacting their financial situation or emotional stability. Establishing a loss limit allows a bettor to control their spending while also limiting potential losses.

Before you start playing, determine the maximum amount you can afford or are willing to lose. When you reach the limit, it’s time to immediately stop betting.

Bankroll Tips for Different Bettor Types

Proper bankroll management is essential to get the most from your funds. Whether you have $100 or $1,000, the goal is to grow the bankroll over time.

There are tips to better manage your bankroll, and depending on your involvement in the industry, the tips will differ.

Since casual bettors play less often, they’ll more likely go for the bigger payouts with riskier bets. Pros are likely to be more conservative in their approach.

Recreational Bettors

Occasionally placing bets on sporting events doesn’t mean recreational bettors should avoid properly managing a bankroll.

It’s still an important part of the process, so set aside a certain amount for that spontaneous trip to Las Vegas or have a friend lay some coin down for you on the Dodgers to win the World Series.

Your disposable income plays a major role in determining how much you can set aside without significantly impacting your finances.

Sharp Bettors

People who wager on sports as a profession to make a profit are referred to as sharp bettors. With different goals than recreational bettors, their approach differs, and tips for success will also differ.

In order to improve their chances of winning, sharps use advanced analytics.

Discipline is critical for sharps to avoid the temptation of risky bets or chasing losses. They are in it for the long haul and take a more conservative approach to ensure their bankroll withstands the turbulence of sports betting.