Outer Limits? For Money Management Sake, Don’t Go There

By Ray Wallin

One of my readers, Helpless Harry, reached out to me with a question. He asks, “how do you keep yourself from losing really big on a bad day when you struggle with being disciplined?”

We’ve all been there at some point in our horseplaying careers. You can’t win a single bet. No matter how good you feel about a race something goes wrong and you don’t cash any tickets. Before you know it, you are hitting the ATM or asking your good friend Rail Guy to spot you a few bucks and hope he isn’t going to charge you too many points.

While I prefer to write about winning strategies and ways to learn from your losses, sometimes you need to know when and how to set limits. As horseplayers we are staking a level of confidence on our forecast or opinion of how a race will turn out. We are accountable to ourselves and our bankroll based on how much of our hard-earned money we are wagering on each race.

Setting limits isn’t always easy. It is even harder when you struggle to stay disciplined as your day spirals out of control. One of the easiest ways to stick to a limit is to set a “loss limit” for your day.

You have handicapped the Monmouth Park race card for a gorgeous Friday afternoon of racing. You found at least three races that are worthy of playing and depending on whether those also-eligible entries draw into the feature race, you may have a fourth solid betting opportunity. You check your betting bankroll and feel that you have the funds to cover the races using a value for each wager you feel comfortable with.

When you are at the track playing that card, luck isn’t on your side that day. You quickly blow through the money you knew you would wager and have added a couple more plays trying to win those losses back. Those don’t go your way either.

What exactly is a “loss limit” and how do you set it?

If you don’t have willpower you won’t stick to your plan. The best way to avoid blowing more money than you had planned to wager is to carry only what you plan to bet that day. If you think that you are going to play $100 in bets, bring only $100. This is your “loss limit” for the day.

If you plan to eat and have a drink or two, bring another $20 for that. By not having a wallet stuffed with $500 on a day you are looking to bet $100, you will not be tempted to dig deeper into your bankroll for plays that are not the best opportunities.

What are the benefits of setting a “loss limit” this way?

#1 Preserves your bankroll


This one is obvious. If you don’t spend it, you will still have it.

When you are losing badly you let your emotions get in the way of your wagering. By having a finite limit your emotions are in check since you can’t play another dollar once you have hit your “loss limit” for the day.

You won’t end up doing something stupid with money you can’t afford to lose.

#2 Avoids chasing losing bets


Have you ever had a car that you loved? Maybe you loved it too much?

I did. I had a hunter green 2000 Jeep Cherokee Sport that I bought new. I loved that car. I loved it so much that I probably put $3,000 more into it that I should have over the last few years I had it. It finally died on me with 175,000 miles on it 17 years and one day after I bought it. Rather than trade it in, I kept saying this will be the last repair I make on it. First it was brakes. Then it was rotors. Then the air conditioning died, and I needed to put in a bypass flywheel. Next it was a starter. All this to keep a car on the road that had the rust being held together by the paint.

In hindsight it was all sunk cost. Throwing more money at a problem that didn’t warrant the investment. By the time I decided I was not going to fix it any more the Blue Book value on it was a few hundred bucks and even that changed based on how much gas was in the tank.

Betting on races you aren’t confident on to try to win back the money you lost is the same as my old green Jeep. You need to know when to stop. Having a “loss limit” gives you the hard stop that you need.

#3 Holds you accountable

Who is responsible for your bankroll?

This is like the question I ask the kids on the soccer team I coach at the beginning of every season, “who determines your playing time?” The veterans know the answer and let the new players on the team field that question. After you hear them all say the coaches are responsible, one of the veteran players will emphatically state, “we do.”

That’s right. The player determines their own playing time by their focus, commitment, being a team player, and overall attitude.

The same holds true for you. You are responsible to set your limits. You are spending your bankroll, and no one is forcing you to spend or lose more. You have no one else to blame if you lose.

So, who better than yourself to enforce a limit on your day’s wagering?

You can debate all afternoon with Rail Guy if you are unlucky or your handicapping was poor last night. Yet by setting a “loss limit” when you know you are prone to getting desperate after a day of bad beats is an easy way to preserve the rest of your bankroll so you can pursue your dream of making your living by playing the races.