Beginner Series Part 8 - Funding your poker game.

Staying between the poles of worthwhile and sanity.

This is Part 8 of this beginner series. I estimated 12 parts when I started and I think that number will probably stay close to accurate. So far, we have discussed in game theory such as: Preflop, Postflop, and River Theory. We also discussed a lot of non game considerations such as: Motivations, Habits, and Building a Team to discuss strategy.

The breakdown of bankroll vs budgets and how your poker money is managed will depend a lot on your motivation and aspirations for the game. Reading the “Motivations” essay is by not a requirement to grasp this document. However, it does touch on some of the same fundamentals of knowing yourself and your goals so you can forge a plan that works for you.

A losing game?….hardly.

Because this is a beginner’s course, it will assume this game, at least currently, is costing you more than it is providing. In other words, a poker financial sheet would show a net loss for poker. If this is not the case, congratulations are in order as you are in a small group of players. An estimated 15% of poker players are winning players after rake for the long term and roughly half of these are marginally so. However, this essay will - hopefully - show you some ways to look at the game that take into account plenty of other factors that likely should be more important to you than profitability.

Managing your money and your enjoyment of the game.

What are your goals?

I have a friend that has done well for himself financially. He is a better than average player that tries to pick up some pointers when he can. He is a thinking player in that he has a process that he analyzes before acting when a hand becomes significant.

The interesting - and perhaps enviable - thing about his game is his outlook on a poker tournament or session. The man thinks about his buy in as an entertainment cost. He will announce something along the lines of “I have certainly gotten my entertainment value for the evening” before he calls an all in or after he busts.

I opined that his outlook is perhaps enviable because to think about your poker game and your poker budget so freely and without concern for a bankroll must be very liberating. He keep records of all his sessions but probably doesn’t feel much pressure after a month in the red. After all, it was in the entertainment budget for the month.

Not every player has the luxury of these poker dollars meaning little more than tokens upon which to add to the entertainment budget. For most of us, if we began losing - and never started winning again - after trying every thing we could think of regarding strategies, methods, game selection, going down in stakes, and more, there would be an eventual point to which we would quit playing the game. For some of us it would take longer than for others but ultimately losing enough times would sink our confidence, spirits, and bankroll.

As we all know by now, each player marches to the beat of her own drummer. Many aspects of our mental and poker outlook affect the way we consider the money which we allot to our endeavor. The way we look at our individual poker finances both affects and is affected by:

1. Our motivation

2. Whether we use a bankroll or a budget

3. If we rely on poker income for our living or to supplement our living.

4. If we use results (money won) to motivate us to bigger games.

5. If we use results (money won) to score ourselves as winners or losers.

Motivation

We all care about money in some way or another. The primary way we view money through the lens of poker has a lot to do with our ultimate motivation. The spectrum varies from the extremes of desire to be a legit professional player to our aforementioned friend that budgets poker as his entertainment. For the first, money carries the importance of having funds for food, rent, electricity, car payment, and every other household bill we have on top of making sure that a fair amount of revenue go to replenish and - hopefully - build the bankroll. The latter simply must have enough green in his monthly entertainment budget to purchase entry into his game of choice on his night of choice and have fun participating.

It’s obvious to me as it should be to you that the aspiring professional is facing a higher stakes situation with his money than the recreational player.

Bankroll vs. Budget

Most of us are probably somewhere in between. The money probably does mean some extra prosperity. It may hurt more to lose the money than the pride lost in the competition. The point is this: The money we spend on entering a poker tournament is typically a mix between money we would otherwise spend on everyday goods and services (i.e. new tires, bottle of wine, or grad school) and money we would otherwise spend on being entertained in that moment (going bowling or the movies).

If you are on the professional side of the spectrum, it is better to have a bankroll that is dedicated to your poker “gig”. This money is specifically used to help generate money that goes back into your bankroll. If you are a seasoned pro, you would take a certain amount of money out of the bankroll each month for living purposes. If you are just getting your feet wet and using poker as a side hustle, you may find yourself adding money to your bankroll each month to build it to the foundation that you need to play your target games.

If you are on the recreational side of this spectrum, it is better to budget a certain amount of money each month (or year) to poker. Winnings would go back into your general fund (bank account). Any move up in stakes would involve reassessing your budget to see if there are sacrifices you are willing and able to make elsewhere.

Relying on Poker income

If you rely on poker income for your livelihood, special care should be taken with your bankroll. A priority should be on: playing games in which you are +EV with an emphasis on field sizes that are small enough to make income consistent (if a tournament player). In addition, some additional thought should be put into chopping when getting at least ICM value for your stack. The deal can be very helpful to a player who depends on poker revenue for working income. Variance dictates that taking ones share is better than gambling on the win vs 3rd or 2nd place. Luck plays a bigger part of end game than when deeper stacked so any skill edge is dulled.

Results to motivate us to bigger games

If you are a recreational player that wants to play bigger games, using winnings to fund those goals is a great way to do it. However, beware of the pitfalls of moving up in stakes without eyes wide open.

Higher stakes games have better players. There may be a few exceptions to this rule (ex. WSOP Main Event), but they are scarce. Players at a higher level have been to - and beaten - the lower level already and have an experience factor. This doesn’t mean an aspirational player shouldn’t take a shot at a higher buyin or two. It just means that when it is taken, it is acknowledged and justified.

Ego plays a big role in life. The poker table is no different. When we are crushing a level and move up and start losing, the immediate reaction is the variance or the other players are getting lucky.

Aspiring pro players have to realize when the “shot” has been taken and failed. Regrouping and going back to the level at which they are successful is the most sure way to regain stable ground with their bankroll.

For a recreational player, it is not much different. As final tables and wins become more scarce, we must go back to the level at which we found success in an effort to maximize our enjoyment and confidence in our game.

There will always be more shots to take in the future. Learning the timing and recognizing the situations is the key.

Results to score ourselves

Keeping a mental “score” based on results is natural human behavior. I can preach “process over results” till Christmas but I know that players (including myself) keep a pretty good score either in their head or on a ledger.

I advise to actually write down every result. Not to keep a more accurate “score” than you can in your head but, rather, to level out the highs and lows.

If I am on a downswing, I can look at my ledger and see that I am a profitable player. Maybe not for this month or the month before but if I zoom out to the previous quarter or the previous year, the results speak for themselves. It also gives me a chance to put myself in check when I am thinking “I run bad” or “I don’t see how all this studying is helping.” The longtime results are there.

On the opposite end of things, when I am having a sun run, I can look back at my losing months and check my own ego before going out to play my next session.

Keeping score

I hope this helps put money in some perspective. There is a lot to unpack when it comes to the green stuff and some people don’t want to talk about it at all.

The main thing is understand that most every player is looking at how money is integrated into his game. However, much like everything in poker - It’s complicated.

Ultimately, like it or not, it’s how we keep score. In the short term - and more importantly in the long term. So make sure you are careful enough to have a “long term” in the game.

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If you enjoy this newsletter, please consider a like (heart shaped icon). If you have any questions, ask below in the comments. I’d be happy to try to answer and if I am unable, I will try to find someone who can.

We will be doing some player profiles (interviews) before the year is up. If there is a player in our group that you would like to know more about, let me know at mikieculpepper@gmail.com.