Bankroll Requirements for Playing Live

I played at the Bike last month and saw many old friends, including Robert Turner, the Bike's poker host. It's always good for me to go to L.A. and visit old haunts and run into old pals.

While at the Bike, CC, a longtime middle-limit grinder and a former prop player, approached me with a question. "If I want to step up from $20-$40 to $40-$80, how big a bankroll do I need if my monthly nut is $3,500?"

You can probably guess what my answer to CC was: It depends!

For starters, I believe that anybody who's beginning to play poker for a living or is making a step up in limits needs six months' living expenses on hand. With a $3,500 monthly nut, CC needs to have 21K. This will ensure that he isn't too personally affected by any swings, and won't vary his play based on how he's running because he's worried about his bills. If you have to worry about whether you're going to have the rent on the first of the month, you might play too tight to protect against losses, or too loose, trying to press to make things happen. You always want to have enough money on hand so that your living situation is not affected by your immediate results, and doesn't affect your poker decisions. This six months' living expenses is not part of your bankroll; it's your security.

One variable affecting CC's bankroll is playing style. If you have a style that presses marginal edges and/or tries to create big volume situations, you're going to have bigger swings and will need a bigger bankroll. Also, how well do you handicap yourself against your opponents? Are you honest about your edge against the field, and are you willing to forego the bigger game for the smaller game when your edge in the bigger game isn't sufficient? Many a time I've passed a $40-$80 game for a $30-$60 game, or a $30-$60 for a $20-$40 or even a $15-$30, because the lineup in the bigger game was terrible and wasn't worth playing. If your ego won't let you step down when the situation dictates, you're going to need a bigger bankroll.

Like me, CC is something of a grinder. In all of my years of playing, I have never had a 200 big-bet slide. That is because of my playing style, which is one that does not generally push marginal situations, and because I am very selective of games, selecting those in which my edge over my opponents is large. Those factors make my game very swing-resistant. I recognize, though, that many people do suffer such slides, and play in games or have styles that result in more chips being risked. This results in potentially greater downswings and, therefore, larger bankroll requirements. Whenever I have experienced my biggest downswings, analysis after the fact has always indicated that something in my life has affected my decision-making and I haven't been playing my best. Variance and fluctuation will dictate many of your swings, but more of them than most players want to admit come from within themselves.

My advice to CC was that he really ought to have 200 big bets – 16K – in his playing bankroll before stepping up. Combined with his living expenses, this means that he needs 37K on hand before making his move. If he suffers a downswing of half of his bankroll – 100 big bets, 8K – he should step down, take some time to reevaluate, and build his bankroll back up. If CC played a faster style, pressing smaller edges, I would recommend that he go up to 300 big bets as a playing bankroll.

I also suggested that he accurately but conservatively determine his expected hourly rate and pay himself for the number of hours he plays once a week, like a paycheck. He should not take all of his hourly rate, but a percentage of it, and keep the remainder in his bankroll to build security and future opportunities. That will enable him to have a stable life and to rely on poker, instead of being subject to the short-term whims of chance in his daily life decisions. It is very important that he not fool himself about what his hourly expectation is, and he must err on the conservative side when he makes this decision. Eventually over time, he should be adding money to his bankroll. If and when his bankroll doubles to 32K, he can cash out the overage, spend some on a good time, and hopefully invest some to help build financial security outside poker. Continue this process: If your bankroll is depleted by half (including what you have paid yourself hourly for your work), step down. If it doubles, withdraw and invest. That is a way to build a life out of the game.

Internet games get all of the attention and most of the action these days, but live poker is enjoying its own renaissance, feeding off the TV and Internet boom. The MGM recently opened a poker room. The Mirage took out the keno game and put back the poker tables. Bellagio's poker room just underwent a major remodeling project. And, of course, Steve Wynn's new property just opened with a luxurious 27-table room and a smiling, affable Daniel Negreanu as its poker ambassador.

I recently spent a day checking out some of the new facilities and playing a little live poker for a change of pace (most of my play is on the Internet these days). I went to both Bellagio and Wynn Las Vegas and was happy as a clam with what I saw. Both rooms are beautiful, comfortable places in which to play. Both are in casinos that cater to high-end tourists, folks who tend to like to play higher stakes and make the quality of the games very good. I think Las Vegas poker is going to do very well with its upgrades. If I were going to give CC some more advice, I'd suggest that he visit Vegas from time to time, be careful in his game selection, and pick off some of the cherry spots at these great new rooms. They certainly create some great potential for working poker players. And they are classy joints for the casual player, as well.

Hourly rate and bankroll requirements are important considerations for those who wish to make a living at the game. Assessing your needs, whether making the break from the working world or stepping up in limits, is an important part of the process. CC is on the right track here.

I suspect that CC will do fine in stepping up – but I think he's making one important mistake. He's ignoring the Internet. If you want to put yourself in the best earning situations as a working pro, the Web just has to be part of your game these days. From a pure earnings perspective, it is probably easier to make a living at only Internet play than it is at only live play – although I think both should be a part of any serious player's business plan. For many reasons, including the nature of the field, the number of hands played per hour, and multitable possibilities, determining bankroll requirements for playing on the Web is quite a different proposition than CC's. But that is a column for another day.

Roy Cooke played winning professional poker for more than 16 years. He is a successful real estate broker/salesperson in Las Vegas. His books are available at www.conjelco.com His longtime collaborator, John Bond, is a free-lance writer in South Florida.