I am not a professional gambler, but I have been both heavily in debt and debt free, from a net worth of -$100k to passing $1m a while ago. We paid off last debt, our house, at age 38.

Others here have made good points, so I'll only add:

1. Don't forget the psychological benefits of having no payments.

2. If you can invest at 7% at mortgage at 3%, fair enough, but don't forget to add in a risk premium and the imputed value of rental income you "pay" yourself. A paid off house is a better deal than it looks.

What % of the $1M is the house?

Smart question. At the moment we paid it off, perhaps 35%-40% of our net worth, now 3 years later more like 25%. It'd be even lower since our net worth has grown, but real estate is temporarily hot in our area.

Jesus Christ. This post and your first one in this thread are just disastrous.

Couldn't agree more. The thought of losing money that isn't technically mine would effect me more than ability to play higher stakes. Also, grinding 1-3 for awhile will sharpen your game and give you much greater appreciation of your roll and life bankroll management.

For what it's worth I suggest checking out the book, Your Money or Life. Interesting read about peoples relationship with money.

From a business perspective, not just poker, most of the successful people I know started with little or nothing and ground their way up. Rarely taking on debt, and then only when they clearly had revenue/income to pay off. Most business I've seen fail started with needing a lot of capital often from people with little or no training/schooling or other investment of time.

That probably depends on the kind of business you are in. My personal experience from consulting on start-ups is a different, pretty frustrating one.

The majority of successful founders I’ve worked with, had at least one failed business in their past where they burned through other people’s cash. The logic behind that is simple: if you have a 25% shot of making it after 3 years or a 10% shot of making it after 1 year, the latter option gives you a better chance of having a successful company after 3 years.

The number of start-ups that use their investors money to do stuff like daily Starbucks runs instead of buying a coffee machine is ridiculous.

I agree. Yes, I am prepared to get flamed by those who say 20 buyins is no problem.

Also I can say from personal experience that no debt is such a good feeling that it is by itself worth it.

Finally, while mathematically correct, the comparison of 7% return on investment and a 3% mortgage makes an assumption that that 7% return on investment is constant and definite . . . the reality is that 7% while not be constant and it is also not definite. There will be periods where that 7% return on investment is actually negative. One thing that is definite is the 3% mortgage rate. One poster expressed this concept as adjusting that 7% return for the risk premium (which makes it less than 7%). Also there is a psychological value to not having to write a check to the mortgage company every month (usually the largest, no exceptions payment for the typical household), no ifs, ands, or buts.

My story - I set aide a very small percentage of my net worth to see if I could profitable gamboolin. It worked quite well and I made a lot of $. I was always very overrolled and never had debt other than my mortgage. I could not imagine being in debt/underrolled. Being a perfessional gombooler is painful enough with out having to worry about debt/ being short rolled

I started underrolled but I was basically living with no debt or expenses. Technically I had a mortgage on my house but I rented out 3 rooms in my house to roommates who essentially paid for my mortgage/taxes/insurance/utilities and then some.

But almost certainly greater than 3%.

Poker is more volatile than stocks and even then the ratio of risk-free equivalent to full-risk nominal yield is like 0.5 (so a 7% yield would be 3.5% risk free).

You can actually get a pretty good idea of what a risk free yield would be by looking at bonds.

The main point is that not all debt is the same.

I find it kind of shocking how many people “build up a roll” from real life to play poker. If youre good, you should be able to build your roll from playing. If you dont have a roll you built up on the side while being a working stiff, dont go pro. If you arent a winner the concept of a roll doesnt apply, because the reason to be “properly rolled” is to be able to handle the swings and continue winning.

I personally put $40 into online poker when i first started, and never put another cent in to gambling. I recognize the up front cost is higher now, but its not 15k.

My intention was to never put a cent in or take a cent out. I view poker as a hobby, and most hobbies dont make you money, they cost you money, so i figure just never touching the money means gambling has no real effect on my finances. However I did incur some debt at one point, and paid off my debt with my roll, and IOUed it back to myself over the next year. Just no reason to be paying CC interest when i have cash on hand.

At lower stakes, even if you can build up your bankroll from playing, it's faster to build an external bankroll.

What is easier, grinding $40 to $400 at 1c/2c NL or 5c/10c LHE online, or withdrawing $400 from the ATM and depositing it? Most online stakes are low enough to fit into a recreational budget, and 1/2 NL live or 6/12 LHE is definitely reachable with a year end bonus.

I agree most people should build their bankrolls internal to poker - but specifically because most people AREN'T good. They're not bankroll-limited, they're skill-limited.

But if you really are that good, and just don't have a bankroll, like many online pros dealt with after Black Friday, get an external bankroll rather than trying to grind it up.

Some good and interesting points discussed here. I commend Bulljive for getting his finances in order before chasing his dream of grinding live poker in Vegas.

I generally agree with both SquidFace and Dream Crushers approaches. However, my experience in L.A. over the years has been that people turn to the low stakes poker when they are in debt to their eyes and have burned personal bridges. Then do they turn to trying the daily 3/5 at Commerce or Gardens or The Bike or put together all their pennies and load up their belongings for Vegas. They may have 5k-15k on hand but are driving away from a bevy of debt and/or personal problems. I guess I’ve ran into people who see it as the last resort on the fringe of society that they are desperate trying to make work rather than a person dream or interest they are chasing.

Personally I would save another 10-15k put the 10-20k into a mix of ETFs, Bonds and Stocks. Especially in the interactive/gaming for the stocks and ETFs and then grind with the other 10-15k starting local and moving to Vegas after I grew it to 20k+. That’s just a hypothetical shot from the hip

My friend Alex from college now is being groomed to run his fathers successful commercial glass business in San Diego. His father had either four or five totally failed business ventures before this one ended up working out. He never wasted money on Starbucks runs the companies just didn’t work for a variety of reasons.

What always impressed me was that he was able to sell his concepts and himself well enough to get investors that many times also that he had the resolve and determination to keep fighting the entrepreneurial fight.

I appreciate all the insight from some clearly successful people. I guess for me the debt felt kind of like a weight on my back even though I was making scheduled monthly payments to pay it off. I also feel like if I fail and the bankroll gets down to an amount I’m not comfortable with, not having the debt makes it even easier to stay afloat and either go a different direction or rebuild.

The main thing is the peace of mind knowing that a downswing isn’t compounded by monthly payments and endless bills. Money is a major stresser for me and I think it would help me play with a clearer mind. So I am going with the debt free 15k roll and play mainly 1/2 or 1/3.

The higher your interest rate is, the worse it is to only pay the minimum. The scheduled payments are designed to keep your principal high so that they can charge you interest over and over again.

If the debt is worth paying off and you are allowed to pay more than the minimum, pay it off immediately with one giant payment so it stops accruing intetest.

As noted, paying interest makes zero sense. It is quite doable to put all of the expenses onto a card, however, and still pay zero interest.

I used to keep a cash stash at the houses that was dedicated to poker. Now it is easier to simply pull from the account if I am making an extended trip like the back-and-forth this month. Even if I were going to punt the day job and play full time, I would still run expenses through the cards and keep most of the funds in an interest-bearing fiscal vehicle and have no more than 15-20 buy-ins in cash at a given time.

Why keep so many buyins in cash?

If you lose 5 buyins between when the bank closes and the bank opens, is it really a good idea to have 10-15 more buyins in cash?

Going to the bank and constantly withdrawing a small number of buyins is irritating but intentionally irritating. It gets you away from the table and while you're in line with a chatty grandma politely smiling at pictures of her grandchildren, you can zone out and consider that if you don't have the patience to put up with a bank line for 15 minutes you don't have the patience to head into a 15 hour do or die poker session.

Another excellent response. You must be a professional counselor.

He clearly missed the point. Michelle is referring to cash as liquid money in a bank, not 20 buy ins of physical cash in your pocket. Notice how she is talking about interest bearing financial vehicles vs cash?

I am surprised people are still trying to go pro in 2018. IMO the best games are on the weekend anyway. Why not just keep a full time or part time job and play Friday and Saturday nights. If you have a consistent income from a normal job then you really have to worry much less about a roll. Also a normal job provides reliable and consistent income to help pay off any debts.

Personally, I would never set out as a pro gambler with any debt (not including a mortgage).

Poker is so much better as a hobby than a job. Keep poker as something you love doing rather than making it a grind.

Just my 2c.

This.

If you’re good enough to win at poker you can almost assuredly make more money doing something else (that you actually enjoy.) A decade ago I ignored that advice, but in 2018 I live by it.


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While that's true, the downside is almost certainly that you have to:

1. Show up, on time, every day

and

2. Have a boss that you don't display contempt for

These two things seem to be a challenge for people attracted to poker, unfortunately. They can be avoided if you are self employed, but, absent exceptional circumstances, that also requires long term commitment and sacrifice. And no morons, "crypto" is not a job.

I think it was Paul Phillips who said that if you're smart enough to make a living at poker, you're smart enough to have a better quality of life doing something else. I take the previous poster's point that someone with the inclination to be a professional poker player is more likely to be low on agreeableness and conscientiousness, which makes holding down a "traditional" job harder.

Personally, I like math and computers, so I'd get a flexible, remote-only, part-time job keeping some small companies' books or writing software, and play poker to supplement that.

At higher stakes in poker the games are often scheduled and you have to show up on time to avoid getting blocked out.

And then you have to sit a table with 8 people, at least 4 of whom are more contemptable than the average boss.