so, why is bankroll management so important?

[blaze666]

so what exactly is bankroll management, how does one do it, how important is it, and what are the basic concepts of it? tell me anything you know about bankroll and money management please.

[bernie]

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so what exactly is bankroll management, how does one do it, how important is it, and what are the basic concepts of it? tell me anything you know about bankroll and money management please.

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Hard to play when you have no bankroll isn't it?

b

[gulebjorn]

Compare a poker player and his bankroll to a company and its financial resources. In order to make money, you have to invest money. You have to put it on the line. Sometimes that investment will make you more money, sometimes it will be lost.

You can never stop investing, because there would be no way to make a profit. So, if your financial resources are exhausted, you can no longer make money.

To cut a long story short, if you bust out, there's nothing left to work with.

The purpose of bankroll management is taking into account all factors that have an influence on your bankroll, and then to decide what game and limit are appropriate for you to play. And that means you should reduce your chances of busting out as much as possible, but without cutting into the profitability (is that even a word?) of the game too much.

Bankroll management consists (among other things) of going up in limits when you have a big enough bankroll, going down when you've lost too much at a certain level, cashing out, clearing bonuses, rakeback, game selection (cash - sng - mtt - steps...), money you will have to invest to learn the game, to develop the necessary skills to become a winning player and so on...

[jjacky]

@topic

bankroll management is only important if you want to play very seriously. for professional players the skill is crucial (probably even more important than the skills at the table). recreational gambler can just stop playing until they earned enough money in their day-job to continue if they burn their bankroll.
if you want to play seriously or just dont like the idea to burn the bankroll, i have read that 300 - 350 BB are the minimum you should have (1400 $ for 2/4 for example). and you neccessaryly have to be a winning player of course, obviously losing players burn any bankroll in the long run, no matter how big it is.

@rakeback
i am very new to this topic, since it was not adressed in the books i read. any hint where i can get good offers for rakeback (especially for party poker)?

[fnord_too]

It is important for two reasons:

1. If you have no bankroll, you cannot play and earn money.

2. Poker is a highly variable game, so even if you are a winning player at a level, if your bankroll (in terms of BB or buy ins depending on whether it is limit or not) is small, it could get wiped out by a bad streak.

If you are a recreational player and/or have other means, bank roll management is not that important since you can always just restock it if you lose it. If poker is a depended on source of revenue, losing your bankroll could be financially disaterous.

[AaronBrown]

In addition to the excellent replies you have received, I would add that bankroll management need not be defensive. A serious player wants to defend his bankroll so he can keep playing. But a lot of recreational players want to build a bankroll, either to become serious players or to have the money for other reasons. Even if you have no use for the money because Granddad's trust fund is more than you can spend, the discipline of building a bankroll will make you a better poker player.

The natural tendency is to increase your bet size when you're ahead (either playing higher limits or riskier poker), but not to cut back when you lose (after all, you need to get even). That leads to the famous gambler's ruin theorem. Even if you are a positive expected value player, you eventually go broke if you give in to this tendency. It's just mathematics, and you can't fight it in the long run. In the short run, the most successful people are often ones that are following this strategy, because it does take you to spectacular highs before crashing (I know, you'll be the one who adopts this strategy, then quits while he's ahead. Good luck.).

Offensive bankroll management, that is taking extra risk in order to build a bankroll rather than reducing risk to preserve one, is appropriate if you can afford to lose your bankroll and stop playing until you earn a new one. That means you're not making your living playing poker, you're funding it out of your recreation budget from another job (or trust fund). In some respects it's the opposite of what a professional would do.