My first book, The Greatest Book of Poker for WINNERS!, explains four basic rules for winning at poker. Rule No. 1 deals with goals and money management-tactics for preserving your winnings at each session. Certainly if you win every session, you will be a winner over the long run. Besides, it's always more fun going home a winner. My book describes two money management techniques-one that I use and one that my co-author Dr. Dan Abrams prefers. Both are similar and can help you to avoid losing back all your winnings when you are ahead.
Variance is a part of playing poker. It's a fact of life. Variance-ups and downs-is as inevitable as the fickle dalliances of Lady Luck. When you enjoy good luck, winnings pile up before you. The river brings the card you need to beat your opponent's hand. Your kicker is one level higher than his. We have all experienced periods of good luck. Optimistic, we hope the good luck will continue. The stacks of chips grow higher. It's a great feeling ... Euphoria! Elation! Ecstasy!
But the poker gods inevitably decide you've had enough and the good luck is rewarded to your opponents. You get what's left. Second-best can be costly. Meanwhile the casino steadily takes its rake. Roughly $150 is subtracted from the chips at the table each hour-about $15 per hour per player, including you. Sure, the casino is entitled to the rake. It has expenses and must show a profit or it won't be in business for very long. While you were winning, the rake was like a fly speck on the poker table-lost in the noise as you won hand after hand.
Now you see your winnings shrink. A bad beat cuts your mountain of winnings down to a mere molehill. It's happening right before your eyes. But you won't give up. Is it greed that keeps you glued to your seat? Greed! The desire to win more. You know you can do it, as you did a little while ago. You pray to the poker gods. You take your favorite good-luck charm out of your pocket and set it atop your chips. Alas, nothing seems to help.
But, there is one way to stem the outward flow of chips back to your opponents. Use money management! Here's how it works: It applies after playing awhile and achieving your original goal, so that you are well ahead for the session. Set a portion of your winnings-say, one half of the winning chips-to the right of your remaining chips: the money you started with plus the rest of your winnings. The chips to the right-that's your "playing money." The rest of the chips are your "money in the bank."
Don't use the money in the bank unless forced to do so. When your "playing money" is gone, it's time to cash out. Go home a winner. Often, while using your "playing money," you lose a few hands and then win a big one. Use these last winnings to replenish your "playing money," and put the rest with the "money in the bank." It's fun to watch your "money in the bank" grow bigger. But it's even more important not to lose it all back to the table. Don't be greedy. Settle for a smaller win. It takes courage, determination, and self-control to use money management. Can you do it?
. . . So readers, what's YOUR opinion?
George "The Engineer" Epstein is the author of The Greatest Book of Poker for Winners! and Hold'em or Fold'em?-An Algorithm for Making the Key Decision and teaches poker at the Claude Pepper Sr. Citizen Center in Los Angeles. Contact George at email@example.com.