Bankroll strategies generally take one of two forms. Either, “I have $200 to play poker with, I play poker with it for a while with no particular rhyme or reason and eventually I have no dollars” or, “I have $200 to play poker with, so I will start with $5 ring games. If my bankroll ever drops below 20 buyins at that level I will move down and rebuild, if it grows to the point that I can take a reasonable shot at $10 games I’ll move up and see how I get on. But if I do move up and my bankroll drops below 20 buyins, I’ll move back down and rebuild.”
The latter example is generally understood to be correct. Mathematically, it ensures an extremely low risk of ruin for any winning player. While this may be true, it is epiphenomenally identical to the former strategy; it can only end in the player having no dollars. Or dying.
The reason is obvious given the title of this article; at no point is consideration given to when to cash out. Instead we grew our roll, moved up, grew our roll, moved up, and so on. When we lose we have less “money” and perhaps we move down, when we win we have more “money” and perhaps we move up. At no time does the money go anywhere other than the poker table.
Of course, people do cash out, but not with any kind of strategy in mind. Rather, they will leave their bankroll to accumulate in their account until their wife (or husband – we aren’t sexist) decides they want a new kitchen (again, not sexist) or the car is in the shop (because they can’t fix it themself on account of the player being a woman – see, I have reversed the genders; not remotely sexist), or it’s time for a family holiday or the seasonal gifting festival is upon us, or their wife has kicked them out for being a patronising misogynistic asshole and they need to furnish their new one room apartment.
This is not a bankroll strategy. It is a buyin strategy. When and how much to cash out should be regarded with the same significance as when and how much to buy in.
There are two basic approaches one may take to this end. Apparently nobody has ever seen fit to write about this before, so I get to name them. The first we will call the percentage strategy, and the second we will call the disco dolphin tuna net fiasco strategy.
The percentage method is the simpler of the two. In essence, you are cashing out a percentage of your winrate. For example, if you are a NLHE player, earmark 75% of your winrate to cash out. If your winrate is 2 BB/100, earmark 1.5 BB for every 100 hands you play regardless of whether you happen to win or lose over those 100 hands. Cash out regularly, at least once per month. In between cash outs ensure you are aware of how much of the money in your account is bankroll and how much is pending cash out, and adjust stakes accordingly should you fall below the magic 20 buyins. Do not borrow from your pending cash outs to supplement your bankroll, and don’t wait until the end of the month to work out how much you should be withdrawing, do it on a session by session basis.
I have, incidentally, pulled the value of 75% of winrate from my lower alimentary tract. Some adjustment will be necessary depending on your winrate and circumstances, but it feels like a good place to start. If you aren’t sure of your winrate, work with an estimated winrate of no less than 1 BB/100; if your winrate is lower than this, you are probably more profitable at lower stakes anyway.
Similarly for tournament players, cashing out 3% of your buyin for single table tournaments, 5% for 45 and 90 man sit-’n'-goes, and 8% for anything with a larger field seems reasonable. For the sake of completeness, a reasonably conservative buyin strategy should look something like; no more than 1.5% of bankroll for stts (65 buyins), 0.8% of bankroll for 45 man sit-’n'-goes (125 buyins), 0.67% of bankroll for 90 man sit-’n'-goes (150 buyins) and 0.5% of bankroll for larger fields (200 buyins). The buyin side of bankroll strategy is well covered at this point, we need not belabour it.
For an established player, I would undoubtedly recommend the percentage strategy. However for a beginner, the disco dolphin tuna thing may be more appropriate. Here, we will cash out a lump sum every time our bankroll reaches a certain level. Thinking about it, I could call this the milestone strategy, but I didn’t think of that until now and I am fond of dolphins and feel it appropriate to draw attention to the dangers posed by tuna fishing. The overall strategy for an mtt player may look like this:
Starting bankroll: $250
Start out at $1 mtts. If you drop below $200, move down to $0.50 mtts until you get back to $250.
At $350 cash out $50. Do this three times.
At $500 move up to $2 mtts. If you drop below $400, move back to $1 mtts until you get back to $500.
At $700 cash out $100
At $800 cash out $100
At $900 cash out $100
At $1000 cash out $100
At $1250 move up to $5 mtts. If you drop below $1000, move back to $2 mtts until you get back to $1250.
And so on. For cash game players, begin with a bankroll of 3000 BB (30 buyins) and cash out 75BB the first time you hit 3100, 3125, 3150, etc, (cashing out 75 BB for every 100 BB you win). Should you find yourself moving up with a 3000 BB roll at the higher limit, reset and continue, cashing out at 3100, 3125, 3150, etc. Similarly if you must move down, 75 BB of every 100 BB still goes in the bank.
With the percentage system, we are adhering to the old addage of “play hours not results”. We are taking our cashouts based on the volume we play rather than the amounts we win. With the milestone system we are operating in direct opposition to this axiom. Nevertheless I believe it is a more appropriate way forward for a novice player, who likely has no idea of his winrate and doesn’t want to encumber himself with the more complex bookkeeping of the percentage method. Psychologically, the reinforcement of cashing out the win when reaching a milestone is also more satisfying, whereas the imagined pressure of “I have to make $x today because tomorrow is cashout day and I’m behind this month” can easily become a millstone for someone who is still developing his emotionally thickened poker skin. Once the player is experienced, has an idea of his winrate and is comfortable doing so, he should of course switch to the percentage system.
Beyond this, in the case of 90+ player sit-’n'-goes and mtts, some consideration should be given to big scores. Prize pools are usually spiked heavily towards the top 2 or 3 places, and while it is undoubtedly true that much of a tournament player’s ROI comes from those occasional big scores, winning $500 in a $10 tournament doesn’t mean it’s time to play $20 tournaments. Any time you make a big score, cash some of the win out. For a win between 25 and 40 buyins, cash out 25%. Between 40 and 60 buyins cash out 50%, and for a win bigger than 60 buyins, cash out 75%.
As with everything else I’ve said, a modicum of sense and a smattering of judgement is required. If you’re operating with a bankroll of 203 buyins and hit a 20 buyin score, then on this one very specific occasion you may prefer to leave that in your bankroll and simply take the buyin percentage as usual. On the other hand if you’re cruising along at 350 buyins gearing up for the jump to the next level and hit a 100 buyin score, you may prefer to cash the entire win out.
While this idea obviously applies more to large tournaments than any other form of poker, SNG and ring game players should also lend an ear. If you have a week where you win more than your fair share of flips, people insist on paying off your straights and flushes and you can’t pick up a hand except to see a big pair, you would be well advised to bank a portion of that fortunate run.
Having outlined the system, we should address the anticipated complaint; “This will take ages! Can’t I just keep building my bankroll until I get to high stakes games and start cashing out then?”
It might, and no you can’t.
This article is obviously intended for the novice or recreational player. It makes the assumption that he is playing regularly and working on his game with a view to becoming a stronger player. It should be recognised that for many such players, their bankroll invariably grows faster than their level of skill. Also that their perceived ability invariably grows faster than their actual ability.
Assuming modest talent and the capacity to learn, such players will quickly find themselves kicking the guts out of microstakes and eyeing up the bigger games, but those bigger games are infested with people who will eviscerate you. Yes, you; singular subjective. Do you see? By abruptly switching from the third to second person pronoun I create a stronger attachment with the reader. It’s a rhetorical device… I am also available for children’s parties, but for some reason I don’t get many bookings.
Regular cashouts have the useful side effect of ensuring that players do not move up too quickly, and that when they do find themselves moving up to a limit that they are not ready for, their exposure there is minimised. True, this will hold the more capable players back, but the more capable players should also have no difficulty smashing the teeth out of the smaller games they are “stuck” in.
A final thought on busting a bankroll. This will happen, and if you are using the percentage system it will obviously happen more often than if you are using the milestone strategy. This is a bit like a toothache. Your tooth hurts because it’s damaged and requires the attention of an expert. Of course it may be some kind of bizarre phantom pain, and you might have busted because of an extended run of extremely unfortunate cards, but this still seems like an opportune moment to examine your play. Or teeth. Of course you should be re-evaluating your play regularly, looking for mistakes and situations where you are bleeding money. Waiting until you have an abscess is by no means optimal, but when the abscess does come along, it’s definitely time to put down the delicious biscuits and seek the counsel of a dentist.
Let me close by saying this again: regular cash outs. Money in the bank, not in the bankroll.