Re: Irish Mike's Poker Tip #4 of 4

It's amazing how tightly wrapped this guy is.  He's found 4 different ways to
say "be disciplined, keep your eye on the goal".

There's no way anybody this tightly wrapped could play a game with 4 maniacs and
survive.

On Apr 7 2007 7:00 PM, Irish Mike wrote:

Poker tip #4 of 4.



In poker there's a big difference between winning money and having money.
Poker players and bad money management are a well established combination.
Some estimate Stu Unger won more than thirty million dollars in his poker
career but he died with $800 in his pocket. Johnny Moss, the Grand Old Man
of poker, finished up broke, standing on the rail and dependent on the
charity of Jack Binion. Mike Matasou stated in a recent interview that he
won more than a million dollars in a poker tournament but was broke less
than a week later. The same bad money management scenario plays out on a
smaller scale in poker rooms all over the country, every single day.
Despite their skill many poker players are constantly broke or on the verge
of going broke. Borrowing money, begging for backers and running errands
for tips becomes a sad, recurring cycle in their professional poker lives.



When you play poker for a living you own your own business. You are
president and chief financial officer of "You, Inc." Ask any business owner
what it takes to run a successful, solvent business and he or she will list
money management near the top. You can have a good business and a good
product but if you're a bad money manager you'll still go broke.



The first thing to understand is that if you aspire to play for a living
your initial poker bankroll really has two components. The first is the
money you actually need to play poker and the second is the amount needed to
cover your monthly living expenses while you get established. In my
experience most wanna-be professional poker players only look at the first
component and ignore, or greatly underestimate the second. If you want to
give yourself even half a chance to succeed you need at least six months of
living expenses in addition to your playing bankroll. It's the height of
blind optimism to think you're going to sit down in a poker game, as a
professional, and start winning from day one. The majority of new
professional poker players fail for the same reason the majority of new
businesses fail. They just run out of money.



But what if you have no intention of becoming a professional poker player?
(Let me pause here to congratulate you on a wise career decision) Well, a
lot of nonsense has been written about poker money management but the truth
is it's not mysterious or complicated. All it takes is a little common
sense and a lot of discipline.



I believe it's essential that even recreational players have a separate
bankroll that is used exclusively for poker. They also need to avoid the
very bad habit of mixing poker money with household funds. You just can't
play your best game if the chips in front of you represent this month's car
payment or grocery money. And when your opponents realize you're playing
with scared money, it's like bleeding in a shark tank.



So how much money do you need to play poker and how should you manage it?
Well that depends on three things. How well you play, the size of your
swings and your poker objectives (Remember tip #1; ask yourself why you
play poker and what you want to accomplish). Obviously the better you play,
and the smaller your swings, the less money you need in your bankroll.
However, a good rule of thumb is to have at least 300 times the big bet of
the highest limit game you play. So if you play $10/$20 for example, your
minimum bankroll should be (300 x $20) $6,000.00. If you play $40/$80 you'll
need at least $24,000. Remember, if you don't play particularly well and/or
regularly experience large swings, you'll need closer to 400 to 500 times
the big bet. If you're like me, and play on the road a lot, you also need
to build in enough to cover your travel expenses.



A worthwhile recreational poker objective is to eventually move up to the
highest limit game that you enjoy playing in, and can consistently beat. So
your $10/$20 bankroll should include taking an occasional shot at a $15/$30
or $20/$40 game, when you see the right kind of line-up. Conversely if you
start losing frequently, never be too proud to drop down and play a lower
limit game until you can identify your problem and rebuild your bankroll.



About now you're probably saying, "That sounds pretty basic". Well that's
because it is. There's no rocket science in poker money management. So why
do so many other-wise smart players do such a lousy job of it? As I said in
tip #3, "It doesn't matter how well you can play. It only matters how well
you do play". Same thing applies to money management. Knowing what to do is
one thing. Having the discipline to do it is another.



I'll give you a real life example. Just recently a young player asked my
advice about moving up from $4/$8 to a $10/$20 game. He'd never played
higher than $4/$8 but said he was "easily beating the game" and had turned
his initial $100 bankroll into $775. I advised him to stick to $4/$8 until
he had more money. He argued that there were two really big fish sitting in
the $10/$20 game. I had played in this particular game dozens of times and
had notes on every player in the line-up. I replied no, there are actually
four fish in that game, they've got a lot of money and they play like
chip-burning maniacs. Well that's as far as I got in my big advice speech
because they called his name and he took a seat in the $10/$20 game.



Sad story short, he bought in for his entire $775 bankroll. He won a couple
of pots right off the bat and was up about $400. Then he lost several big
hands plus one huge heads-up pot and tried to push some drawing hands past
the chip burners. He hit the rail broke in less than two hours. Now I'm
not saying he's a bad player . I am saying he's a bad money manager.
First, he sat in a jammed-up game without the bankroll to handle the swings.
Second, he gambled more of his bankroll than he could afford. Third, he
didn't lock up his win and fourth, he didn't set a loss limit.



So what can we learn from this poor lad's misfortune? First, if you're
going to make a run at a higher limit game at least consider how fast it's
playing. Yes, four maniacs with money can certainly be a +EV. But these
same maniacs can also burn up a lot of your chips along with their own. If
you're in a game where it costs you three or four bets to see every flop,
you better have the bankroll to handle the inevitable swings associated with
wild, loose play. In addition, this kind of game usually attracts some very
solid players who are there to take a shot at the fish tank. Focus too much
on the maniacs and one of these solid guys can knock you off. BTW, I'll
just assume you are keeping notes on any opponents you face regularly.



Don't gamble more of your bankroll in a single session than you can afford
to lose. In a typical $10/$20 game I'll buy in for 20 big bets ($400) and
have another $400 in my pocket. If my stack drops below $200, I re-buy for
another $200. I don't want to lose more than 10% of my total bankroll in
any single playing session. I'm not saying these rules need to be chiseled
in stone but they represent the kind of discipline it takes to keep from
going broke during the tough times.



Always look to lock up a win. The objective, of course, is to maximize your
wins and minimize your loses. The trick is to find that balance between
shutting down a winning streak too soon and giving back everything you won
plus some. How many times have you heard a player say, "Damn, I should have
quit when I was ahead?" Or, "Man, I was up $600 and now I'm stuck $500".
Well some where during that $1,100 swing would have been a good time to
think about locking up a win. If I'm up say $1,000 in a $10/$20 game I'm
not going to quit if I lose a pot. But I am going to decide on an amount of
that $1,000 that I am going to walk out with. For example, I might say,
"OK, I'll play back $300 of this win but when I'm down to $700, I'm out.



Now I can hear the RGPers screeching from here. "You shouldn't set an
arbitrary number like that." "It's all just one big game and it makes no
sense to quit today when you know you're going to play tomorrow." "You don't
play poker by the session; you play poker by the year". Or, the one that
has busted more players than any other single sentence in poker, "Never quit
as long as you are a favorite."



Well my response, with all due respect, is you manage your money and I'll
manage mine. If I'm up $1,000, in a $10/$20 game, that's a pretty decent
night. Now I blow back $300. Maybe I've been playing for three or four
hours and I'm getting a little tired. Maybe the line-up has changed and a
couple of weaker players have left or just tightened up. In any case, I'm
still ahead $700. Do I want to sit here and chase that $300 or is there
something else I would like to do? Am I going to sleep better tonight with
a $700 win or knowing that I developed ass glue, gave it all back and
ended-up losing $200? Am I likely to play better tomorrow knowing that I'm
fresh, rested and up $700 from the night before? Personally, I'll walk out
with the $700 win and sleep just fine.



I believe in setting loss limits. There, I said it and I ain't ashamed. I
know, all the experts say "Never quit as long as you are a favorite". Well,
yes they do and so does every RGPer who has ever read Sklansky or Malmuth.
Yet if all these poker players never quit when they are favorites, why do so
many of them end up losing their asses?

The answer is, they weren't favorites and they didn't have the discipline to
walk away with a small loss.



If you're stuck more than 30 big bets in a game, you need to stop and ask
yourself why. Maybe you're tired, maybe the line-up is now tougher than it
was or maybe it's just not your night. Hell, maybe there's some collusion
or out-right cheating going on. In any case, my recommendation is to
seriously consider calling it a night and walking away. Sure, some times
you can turn it around and fight back to even or scrape out a small win.
But, for every time that happens there will be a lot more where you'll just
bury yourself that much deeper. Again, how much of your bankroll are you
willing to lose in a single session?



To be fair, staying in a game as long as you are a favorite is actually good
advice. Assuming all poker players are totally objective, can accurately
pin point that exact moment when they switch over from being a favorite to
being a dog and then have the discipline to immediately get up and leave the
game. Sorry, but most of the players I've observed lack that accuracy. In
fact, most of them believe they are playing just as well in the eighth hour
as they were in the first hour and that they play just as well when they are
losing as they do when they are winning. Sadly, neither is usually true.



My personal rule is to never lose more in one session than I can reasonably
expect to win back in another session at the same limit. Here's why. Let's
stick with our $10/$20 game example. I'm stuck 30 big bets ($600, or 10% of
my $6000 total bankroll) so I get up and leave the game. Now I'm going to
review that session in my mind and try to figure out why I lost. Was I
tired or not feeling well? Did I get sloppy or start chasing? Did the
line-up change? Did I just get out played? I'll be a hell of a lot more
likely to come up with an honest answer once I'm out of the game and can
really think about it. I'm not happy but I know I can turn it around
tomorrow. I at least know I had the discipline to walk away with a small
loss. More importantly, my bankroll is still in good shape. All I need is
one good session at the same limit and I can recover my entire loss and
maybe even make a small net win.



Now compare that to what happens when a player stays in the game and starts
chasing his or her loses. That 30 big bet loss can easily turn in to 60 or
70 big bets. You're stuck $1,400 before you finally run out of money or
just throw in the towel. It turned into a marathon session and you're too
damned tired to see straight, let alone objectively analyze your play. Now
you get home and try to sleep. You know that it's going to take you at
least three winning sessions in a row just to claw your way back to even.
The more serious consideration is that you just dumped 23% of your total
bankroll in one session. Plus, it's psychologically harder to regain a
winning mind set - and mind set is a big part of the game. You're kicking
yourself for not having the discipline to quit sooner. When you walk back
into the poker room, every one who was in that game, or has heard about it,
knows you lost your ass and they're going to be looking for a way to exploit
it. The negative effect of a big loss can be cumulative and impact your
future play. No poker player wins all the time; the difference is having
the discipline to manage your money and control your losses.



Thank you for allowing me to share these four poker tips. I hope you found
something of value in them.



Good luck,



Irish Mike
Gary Carson
http://www.garycarson.com



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