*This article is out dated. Read the new article on poker bankroll management for a thorough guide on how to manage your poker bankroll.
Bankroll management refers to playing poker within your financial means. The most common mistake new poker players make is playing outside of their bankroll. Utilizing good bankroll management techniques is one of the keys to winning in poker.
As an experiment, Chris ‘Jesus’ Ferguson (from Full Tilt Poker) attempted to earn $20,000 from just $1 playing online poker. The catch was that he would do this without breaking the rules of proper bankroll management. It only took Ferguson a few months to reach his $20,000 goal and he proved that by using bankroll management you don’t need to play high limit poker to make good money. It’s all about time, patience, and poker knowledge.
If you set aside $1,200 to play poker with, that’s your bankroll. New players, who see this as being a lot of money, often think they can play much higher limits then is appropriate for this bankroll size, like $10/$20 limit holdem or $200 no limit holdem. You’d be severely under bankrolled for these limits and experience both large short term upswings and large downswings that can cause you to go broke in a single session.
The rule for a proper limit holdem bankroll is to have at least 300 big bets for the limit you’re playing. With a $1,200 bankroll you should be playing no higher then 2/4 limit. By having 300 big bets you should be able to handle the short term swings that poker dishes out and have minimal chances of going broke.
For no limit Holdem your minimum bankroll should be 20 buy-ins. With a $1,200 bankroll you’d have 24 buy-ins for $50 NL holdem (usually .25/.50 blinds). The next step would be $100NL holdem, but you’ll first have to reach a $2,000 bankroll before playing that limit.
Losing streaks still happen to good players who have bankroll management skills. These can last a few days, weeks, or even a month. You should be ready to drop down a limit when your bankroll no longer justifies the stakes you’re playing. It’s not a big deal; you just have to build yourself back up. Sometimes otherwise good players will be stubborn and refuse to go down a limit. Sometimes it works out, and other times they’ll lose a lot more money or even bust. Is this a risk you’re willing to take?
These are the strategies used by winning poker players. Everyone’s vulnerable to the short-term variance that comes with poker. With proper bankroll management you’ll be able to handle the highs and the lows of poker both mentally and financially. The gamblers will come and go, but in the long run the players managing their bankroll correctly will always come out ahead.