Quote:
Originally Posted by Hellmuth was right
Country you live in: USA
Income: grind 2/5-5/10 full time with no other income. being conservative I expect to make 60k this year. i am 26, single, I live very cheaply, my monthly expenses are about 1700-1800 per month. I have 40k net worth, all of it is in cash.
Risk Tolerance: Medium to high
Timeframe for investment: long term
Debt: None
My max expected downswing is 15k, I would drop down to solely 2/5 I if I went on 10k downswing. 6 months living expenses would come out to 10k for me. Do I have enough to start investing? If so, would you recommend putting it in an ira to help reduce taxes owed, or something more liquid so that I would be able to access in case of medical or other emergency?
i used to be in this situation in my younger years so heres what i would recommend.
because its the beginning of april you can still max out a $5500 roth for 2016 before tax day, as well as $5500 for 2017. so i'd look into doing that.
your max expected downswing will not be 15k (you prob haven't been playing live mistakes poker that long). however with that said the main risk you have is not a massive downswing and thus busting your roll, but instead a long period of slight winning/breakeven stretch where your $1800/month expenses will eat up your net worth/poker bankroll. it is very possible and almost certain to have a breakeven year (which in this case would eat up half ur net worth).
conservatively i'd keep grinding live if thats what you plan on doing and save as much as you can of your expected 60k earnings. i'd do this for a few yrs before moving up in stakes.
after a few years of this you will realize live poker is all about capped earnings for 95%+ of good pros and your yearly expected earnings will actually decrease over time as games play tighter, players play a more break even strategy, casinos increase rake and then hopefully by then you have saved up enough $$ to gtfo of live poker.