Why is bankroll management a critical part of your poker strategy?

Why and how is bankroll management a critical part of your poker strategy? Well, most poker players are aware that poker is a game which combines skill and luck. The skill element comes from a honed approach to poker strategy. And poker strategy is a lot more than just knowing your hand rankings!

There’s a lot of great advice available on what to look for when you start to learn poker and it’s not all about straightforward bluffing ability. It’s important to know the rules of the game, hand rankings and the varying situations for in-play odds.

The other vital ingredient in your poker strategy is bankroll management.

This is a phrase which sounds like it could be tedious, but players beyond the purely recreational stage of poker take bankroll management very seriously indeed, and if they don’t, they should do. It’s a poker management strategy that can make the difference between staying in the game and going broke.

So what exactly is it? Well, a simple definition would be that you keep your play within certain limits to avoid losing your poker bankroll to a bad run of cards. This is called ‘playing within your bankroll’. A bad run of cards is also called ‘variance’ and is inevitable in anyone’s poker game, regardless of their skill level.

Variance describes the fluctuation of good and bad runs of cards and the resulting differences in making a profit or a loss from the game.

So, to avoid going broke when on a bad run, the trick is to use some poker bankroll management rules to allow you to keep on playing, absorbing the losses without risking all of your bankroll, until a point where the cards go your way again. Of course, if you’re playing at levels which you don’t have the skills for then it’s unlikely you will win anyway. That’s where some poker training could come in handy!

Let’s look at some basic poker bankroll management rules for Texas Hold’em:

  1. Ensure your bankroll is 20 times the buy-in amount for No Limit Hold’em, meaning you only ever put a maximum of 5% of your bankroll on the table at once
  2. Or, x 300 big blinds for Limit Hold’em
  3. Or, x 40 buy-ins for Sit’n’Go Tournaments

Bankroll management is an alien concept to many players, so by mastering yours, you can grab a great advantage over your competitors in the longer run.

There will be moments when your poker bankroll may be too big or too small compared to the limits you are playing at. As a general rule of thumb, if your bankroll drops below 20 full buy-ins then you should drop down a level and re-build your bankroll back up.

Conversely if you have over 20 buy-ins for the limit you’re playing at then it’s ok to move up a limit if you feel you can. You can always move back down if you experience heavy losses.
It is also useful to keep your bankroll separate from your day to day living expenses money to ensure that you can keep good management of the bankroll profits and losses and to avoid the mixing up of money intended for other purposes. This is definitely a responsible gambling strategy!
Bankroll Management Tips:

  1. Play within safe bankroll limits as follows:
    • NL Holdem Cash: 20 buy-ins
    • Limit Holdem Cash: 300 Big Bets
    • Tournaments: 40 buy-ins
  2. Create a chart for your bankroll management strategy and log your profit and loss. Keep it handy so you always refer to it when buying into a game.
  3. Don’t check on your real money balance
  4. Take your online poker game seriously, treat it with respect and avoid distractions
  5. Don’t play when you are tired, hungry or have something else on your mind
  6. Avoid tilt when playing – leave the tables until you have recovered from it, otherwise you are on course to lose your poker bankroll!

Daniel Negreanu on Bankroll Management

Bankroll management with Kara Scott

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