How to manage a newly established bankroll?

[nick.o]

Hey everyone! I’m new to this forum, and i was wondering how a new player like myself can establish a bank roll at a 1-2 NL table. Should i buy in for mim of 40 dollars, and just build it up form there? Is there any tips or tricks when building it? Also do you ever touch the bank roll money? for an example, using it for anything else?

[QuickerChipPickerUpper]

In my mind, your bankroll should be established away from the table. A proper bankroll for 1/2 is probably $2,000. Now if you are talking about proper bankroll management, that is a different subject. I would advise against buying in for the minimum. I see players sit with $100 and if they don’t rake the first or second hand they get involved with; it’s pretty much gone. Also, I like to buy in for the max in case some great happens situationally early. I have literally flopped the nut flush in my very first hand of a session and tripled up in a 3 way all in.

[Patrick]

Hey Nick.
You could write an entire book on this question alone. I’ll try to break it down in some kind of short answers though.

IMO, the most important factor is how you play and your risk threshold. If you play full time as the only source of your income, your BR management will be vastly different from someone who plays on the side of a traditional career. So as your game develops and your life situation changes you will need to adjust your bankroll management style. I am going to make a few assumptions about you based on your post above because there isn’t much info to go on, and ill write my BR management suggestions based on this. I presume you are a somewhat experienced player but you do not play “full time”. You probably have a job as a primary source of income, but you take the game seriously enough that you are a winning player and looking to make poker a part of your income stream. I’ll also assume you play low level but will try to move up when you can (from a skill and BR management perspective). If i am way off somewhere, feel free to correct me.

OK, so as a general concept, BR management is all about making sure you never go broke. If you have a “regular” job its pretty easy to do that, and you can be much more aggressive in your play. Many Pro’s wont risk more than 5% or their BR in a cash game (some even go with 2%). But their risk of ruin is far greater than someone who plays poker on the side. I would still recommend never going above 10% of your BR on the table at any one time. The beauty of using a % is that is you win/lose your cash available to play automatically adjusts with it putting you in bigger and smaller games accordingly. As such, you should naturally end up in the game that is right for your skill level. you will win in lower stakes games and build the BR, and you will lose in games that have players better than you (presumably larger stake games) and your BR will take a hit and you will be forced to move down.

Using this you can find your game stakes of preference. If the income is what matters, you want to play below the stakes that you are good enough to break even at. If your skill growth is what is important to you, the break even game (or slight winner) is most often where you will learn the most (at the expense of your hourly rate). For example lets say that you have a job with a regular income and you play on the side with a $5000 BR. You play 10 hours a week on average at 1-2 ($200 buy in is 4% of BR) stakes and are making 8bb/hr. You should clear about $8,320 a year (4160 bbs). So after a year your BR is $13,320. Big enough to move to 2-5 ($800 buy in is 6%, $500 is 3.7%). Now you only make 3bb/hr because the game is tougher. So now your take home is $7,800/yr(3,900 bbs). You are making less money at 2-5, but you are still making money, so I would stay at 2-5 in this situation to develop your play.

Now lets say same thing, but full time poker player. You play 30 hours per week at 1-2 and make 8bb/hr for $24,960k/yr. This is pretty unrealistic to live on 1-2, but bear with me for the sake of the example. ok, lets say you spend 80% on living costs and apply 20% to BR growth. that means you live on 20K/year and your BR grows 5k per year. So now it takes you 1 year and 8 months to make that same $$8,320 from above. at which point you move to 2-5 just like above. now you are making $23,400/year. Can you really afford to take a pay cut here? probably not. in this case i would stay at 1-2, only playing 2-5 occasionally when the games are extra soft and your edge is bigger, until you improve to more like 5 or 6 bb/hr at the 2-5 game. especially considering that you need to pay taxes, insurance, full social security and medicare (traditional employer will pay half of that if you have a “real” job) and save for retirement. Oh, and rainy day savings for when you car breaks down and that sort.

Personally i try not to exceed 5% of my own bankroll which is more conservative than I need to be because I have other sources of income. But its fine for me because i don’t think my skill level warrants me going higher than I play right now. I usually play 2-5, and if I am not happy with the 2-5 scene I will move down to 1-2 or 1-3. On RARE occasion I will dabble at the 5-10, but only if it looks really good.

Also, side note… I never buy in for table minimum. Almost always table max. I want to be able to cover other players in the event i get in a big pot. I do not use my stack size to minimize my losses, i use my stack size to maximize my wins. That’s just my preference. Some people play differently though.

[nick.o]

This is a great reply! you covered a lot of my specific questions with establishing my bank roll. You were right about a bunch of various things but there some other variants. So in my situation i work two jobs as it is. I live at home, and go to college. I figure this gives me some wiggle room, but in a sense I can only afford to buy in for 80 and not max buy-in. So do you think its possible build up my bank roll from 80 dollars up or should i save up for a max buy in?

[Patrick]

its absolutely possible. But with no safety net (that’s what bankroll management is all about) its much more likely that you end up with a $0 bankroll and have to reload it from personal savings. That’s how many recreational players do it. At some point you will have a good enough winning streak that you will actually develop enough BR to handle a swing or two. Once this happens, then you can really enact the BR management guidelines such that you never go broke again. I agree with quicker above about $2,000 being a minimum for a proper 1-2 BR starting point. Until then, focus on your game.

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