Did you know...
Proper bankroll management, simply put, is planning to not go broke. Loosing players might have an 'aha' moment here, but unfortunately for them proper bankroll management does not turn loosing poker players into winners.
The thought behind bankroll management is that if you never put your whole bankroll at the poker table, you can't loose it. It might become smaller, sometimes over periods longer than you could possibly imagine, but after every session there will be enough money left to keep on playing.
The most important tool for executing proper bankroll management is game selection, in this context mainly referring to choosing the right stakes to play at. The size of your bankroll should decide what the highest stakes will be you are going to play. If your bankroll grows you can move up in stakes. If your bankroll gets below a certain threshold you should move down.
(# for next level)
|Move down at
(# of current level)
|No limit hold'em cash||20 buy-ins||14 buy-ins|
|Limit hold'em cash||300 big bets||200 big bets|
|Sit and go's||40 buy-ins||25 buy-ins|
|Multi table tournaments||100 x average buy-in|
These guidelines can get you very far and you might never be in danger of loosing your whole bankroll if you are disciplined in moving down when needed. However, if you know a little bit more about the 'why' of bankroll management you will also realize that the guidelines above are quite a generalization and therefore will probably not be valid for every poker player at any level.
Variance in poker refers to the influence of chance on a poker player's results. It causes ups and downs; it can make loosing players win and vice versa. In the long term the influence of variance is said to 'even out', have a negligible influence on the overall results so you will, and the true skill of a poker player becomes apparent (win rate). In the short term results can be completely dominated by the influence of chance. Don't let the phrase 'short term' mislead you, because many poker players say that, in poker, 100.000 hands played is still the short term. Even over such a large number of hands proper bankroll management should get you through the downside of variance; it should make you weather the storm.
There are several factors that can determine and/or influence the amount of variance, positive or negative, a poker player might experience. Playing style, mental strength, and the games of choice (mainly considering the opponents, poker variants and stakes) are all of influence. Tight players in general experience less variance than loose players. Someone playing a very loose shorthanded game at high stakes will most likely have a lower win rate and experience more variance than someone playing full ring micro stakes with a considerable edge over his opponents. Mental and emotional instability, tilt, can severely increase the amount of variance a poker player might experience. Some people (a lot?) just don't feel comfortable playing with only twenty buy-ins and might even 'play scared' with such a buffer. Pot limit omaha is a higher variance poker game than for instance no limit hold'em and so on.
As you can see, proper bankroll management to protect you from going broke by the influence of variance is highly personal and often times the bankroll management guidelines mentioned won't nearly apply. This also means that you shouldn't be worried or ashamed about playing over rolled, that is: playing lower stakes than you could according to the general bankroll management guidelines. As you play more poker you will get a better idea of the variance your playing style and your game of choice brings you and what bankroll you will need to feel comfortable with and to keep you from loosing it all at the tables.
When starting out in online poker with a very small bankroll one probably knows next to nothing about the variance in poker. However, at the nano and micro stakes the opponents will be generally bad and loose introducing enough ingredients for some roller coaster variance on its own. On top of that, a beginning poker player's game might not be top notch (yet) which will also result in some extra variance. All the more reason to take an extra look at bankroll management for specifically this stage in a poker player's career. The following are some recommendations for hold'em cash games (where I think you can most easily build a bankroll):
Don't play no limit hold'em with less than 5 buy-ins ($10 for 2 nl). Try the lowest available limit hold'em games instead. In these games the variance and therefore the risk of loosing your bankroll is a little lower.
With 5 to 15 buy-ins ($10-$30 at 2 nl), buy in short with only 5% of your bankroll ($.50-$1.50 at 2 nl) or the minimum amount possible if that is more than 5% (at PokerStars for instance, the minimum buy-in would be $1 at 2nl or 10% of a $10 bankroll). If you double up, leave the table and go sit at a new one starting again with 5% of your bankroll or the minimum amount possible. Go back to playing limit hold'em if you fall below three buy-ins.
If you reach 15+ buy-ins you can buy in for 100 big blinds ($2 at 2 nl) and keep playing after doubling up. With more than 300 big blinds at risk (i.e., you and another player have at least $6 at the table at 2 nl) strongly consider to leave the table and start again at another table with only 100 big blinds. Go back to buying in short when falling below 10 buy-ins.
With 15 buy-ins for the next level you can try to move up ($75 for 5 nl). Move back down if you fall below 8 buy-ins.
Give yourself a larger buffer for levels above 10 nl.
Putting it all together in one scheme it would look something like this:
|Bankroll||Game/stakes||Move down at||Comment|
|<$10||Lowest stakes LH||-||Play tight and patiently!|
|$10||2 nl||$6||Buy in with 5% or min., leave when doubled up|
|$30||2 nl||$20||Buy in full, be extra careful with a deep stack|
Some additional tips:
Make sure that the poker room you start playing at offers stakes low enough for you to follow proper bankroll management guidelines. Also take a look at the online poker rooms page for more information about the availability of nano stakes and micro stakes cash games at certain online poker rooms (bottom table).
Play very tight and patiently in these loose games. Especially if you start with a tiny bankroll of around $10. Once you get that up to $20-$30 the risk of going broke is considerably smaller and you can try to experiment a little bit more.
You don't have to move up. If you feel uncomfortable moving up or just want to focus on your game before moving up than there's no shame in waiting a little longer. Moving down in time though, can be the difference between succeeding and going broke.
Proper bankroll management can harness a winning poker player against the negative influence of chance on his or her results. Loosing players on the other hand are better off setting aside a certain budget they can afford to loose or otherwise should try to improve their game, because bankroll management won't help them win.
Keep in mind that the bankroll you need to be safe from going broke by variance and to also be comfortable with is very personal. Therefore most of the guidelines out there only represent the bare minimum bankroll you should have at a certain level and there's nothing wrong with being over rolled. Moving down in time on the other hand is key to practicing proper bankroll management.
Some might be very risk averse and move to the next level only when they are already over rolled for it and consequently never have to move back down. Bankroll management comes naturally to them. For others bankroll management will be a real test in discipline as they are attracted by the excitement of the danger of losing their roll, are prone to tilt and 'chasing losses' or just want to make some real money quickly. Whichever description fits you, know that playing well only gets you so far in poker and that bad results will come. Realize you need your bankroll to be able to play and protect it wisely in a manner that suits you the most.