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Bankroll Management

Many players manage their bankrolls in a way that almost ensures going broke.  The routinely play in games much higher than their bankroll allows and continue to move up to even higher limits after booking a win.  When the inevitable bad run occurs they are completely wiped out since they were not playing with the necessary cushion to withstand the natural ups and downs of the game. 

If you are a casual player or extremely wealthy then much of the advice on bankroll management can be ignored.  Casual players, who do not mind losing their entire bankroll and being out of action until they are able to replenish it from outside of poker sources, can be much more liberal in their game selection.  Wealthy people, who can simply add more money to their bankroll whenever needed, as poker wins or losses make no significant difference in their income and standard of living, can be similarly lax in choosing which games to play.  The players who this advice applies the most to are serious players who depend on poker for all or part of their income, or for other reasons want to take precautions against going broke.

I am somewhat of an expert when it comes to bankroll management.  It is not an area of expertise that I am naturally inclined towards.  In fact the reason I am so well versed in the subject of bankroll management is quite simple.  I have made every conceivable error.  I have routinely played over my bankroll and otherwise taken shots in games that I had no business being in.  I have thrown good money after bad by moving to higher limits in attempts to recoup money that was long gone.  I have been unable to step down in the face of mounting losses and a dwindling bankroll.  It has hurt both my potential to earn as well as my peace of mind.  Hopefully this article, information which I came by the hard way, will save readers some of the frustration that I have faced and help you to avoid some of the mistakes that I have now learned to avoid.

Bankroll Requirements

It is difficult to set hard and fast rules as far as bankroll requirements are concerned because there are many variables.  The particular game you choose to play, as well as your playing style will affect how large a bankroll you need.  If your style is especially loose then you will need more money to withstand the natural fluctuations that style of play creates.  Exceedingly tight players may be able to get by on slightly less.  If you are specializing in a game like 2-7 Triple Draw or Pot Limit Omaha you will likewise need more money then a player who is playing Hold ‘em, or Limit Omaha Eight or Better.

Mason Malmuth, the noted poker author, has suggested that players should have around 300x the big bet for limit poker.  For a full ring game in the middle limits, this has proven to be about right.  At games higher than around 30-60 the level of play improves, and the games also become much more aggressive.  I would suggest 400 big bets as the minimum amount sufficient for play at these limits.

You will also need a significantly larger bankroll if you plan on playing short handed.  These games are more aggressive and feature larger fluctuations.  Again a minimum  of around 400 big bets is a good starting point for games that are generally 4-6 handed.  500 would be much better if you are playing high limit, as well as short handed.

If the majority of your play will be heads up you will again need to add to the minimum acceptable bankroll.  For these games I would suggest at least 500 big bets, although more would be better.  If you plan on playing in the high-limit heads up games that feature some of the best players online, you will need a very large bankroll, upwards of 1,000 big bets.  These games move at an insane pace and fluctuations can be huge.  Protect yourself with a large bankroll. 

If you plan on playing No-Limit or Pot-Limit games then you will likely look at bankroll in terms of buy-ins rather than in terms of big bets.  For the lower stakes games (all games up to $1-$2) a minimum of 20 buy-ins is a good starting point.  For mid stakes ($2-$4 through $5-$10) closer to a 30 buy-in minimum is more prudent.  For higher stakes games (above $5-$10) you will want to have at least 40 buy-ins as the competition is exponentially more experienced as well as aggressive. 

Your playing style can have a much more profound impact on your minimum bankroll requirements in No-Limit games.  There are a much wider range of styles that can beat No-Limit whereas in Limit it is generally just different degrees of Tight Aggressive play that gets the money.  If you play extremely loosely and aggressively then you will need significantly more money.  If you are a nut-peddling nit you can get by with significantly less.

Moving Up and Taking Shots

When to move up in limits is a tricky question.  The most obvious, and safest route is to never move up until you have a full bankroll for the next limit.  While this is a sound strategy there are other ways to potentially move up faster without taking on too much excessive risk.

You may want to begin taking shots at the next highest level when you find that you have around 15 buy-ins for No-Limit or 200 big bets for Limit.  If you find yourself closing in on the bankroll requirements for your regular limit you need to move down immediately.  For instance if you usually play $200 buy-in ($1-$2) No-Limit with a $4,000 bankroll you may want to take a shot at the $400 ($2-$4) game when you have between $6,000 and $7,000.  If you get off to a bad start and find yourself getting close to the $4,000 bankroll then you need to go back to the $200 game.  In this example under no circumstances would you go below $4,000 without going back to the $200 game.  This may be too risky for some but others may not mind the added risk.  This is a personal choice and there certainly is nothing wrong with waiting till you are fully bankrolled for a game before moving up.

One thing that should always be on your mind when moving up in limits is the Peter Principle.  Like in business, people tend to move up limits in poker until they reach a limit that they are inadequate for.  You need more than just a bankroll to move up in limits, you also need the skills to beat a game.  Don’t go down with the ship.  Always be prepared to move back down in limits if things are going poorly at the new limits.  Never lose more than what will leave you with an appropriate bankroll at your former limit.  Always be aware of how you are stacking up against your opponents and if you find that you are not comparing favorably then swallow your pride and move down.

Conclusion

Bankroll management would be easy if it were as simple as knowing the numbers and applying them.  Technically is that easy but in the heat of battle or in the midst of a losing streak it is much easier said than done.  When losing you must be able to realize when you need to go down in limits where you will have an adequate bankroll.  It can be extremely difficult to lose your money at higher stakes and force yourself to drop down to win it back at lower stakes, where recovering will take much longer.  It is difficult, but it is imperative.   You cannot just, because you started the week with a bankroll suitable for 10-20 No-Limit, continue to play that game if losses are mounting and you no longer are appropriately bankrolled for that game.  It doesn’t matter where your bankroll started, it is what it is.  If you go broke then you can’t earn.  There is no winning your money back from the rail.  If your bankroll tells you to play at a lower limit, then listen.