Many players hear the words "money management" and they immediately think of some sort of system for beating the casino games. They do not view money management as something to be concerned about in a poker game.

The true essence of money management in poker really comes down to bankroll management. It is how you handle your money to ensure that you will not go broke. You can’t play poker if you don’t have any money to get in a game. Anything you do that causes you to lose money and is a detriment to your bankroll is commonly referred to as a "leak" in your game.

A "leak" in poker is defined as:
1: A gambling situation in which you engage on a regular basis with a negative expectation.
2: A lack of discipline and/or knowledge that causes consistent losses in your poker game.

The first leak that many poker players have is that they like to play other casino games. I know a few players who will hit it big at the poker table and then blow their money at the craps or blackjack tables. If you insist on playing other games, then the best way to manage this is to have a separate poker bankroll and set aside other money for "entertainment," which you will lose in the casinos if you play games where you don’t have the edge (hint: learn Speed Count for blackjack or dice control for craps and you’ll have the edge when you play)

The second type of leak that cause lost money comes from your own playing abilities. Playing in games that are above your bankroll limits and/or your skill level can definitely cause you to lose money. Some players make the same mistakes repeatedly and then wonder why they are losing at the tables. The first and most basic step that you need to take in order to fix any problems in your game is to identify and isolate your problem. Some common leaks are:

• Playing too many hands.
• Playing any Ace.
• Calling too much.
• Not knowing how to figure pot odds.

Getting input from more experienced players will help you identify how you can fix your play. Keeping good records of each game that you play is vital in tracking your wins and losses and may help you identify some of your problems, especially if you play in different limit games. If you can’t beat a $10/20 game, move down to a $5/10 game.

Plugging leaks in your game is a vital step in money management. One of the most debated topics when discussing money management in poker is that of stop losses.

Since most casino games have a negative expectation, players are advised to set a win goal and stop loss. This ensures than that they will not go broke during any given session and will hopefully not give back all the profits if they do win. Some argue that the concept of money management is nothing more than smoke and mirrors because if you play a game with a negative expectation you will lose in the long run. Setting a stop loss is just a way for a casino player to hold on to their money a little longer.

Poker, however, has a positive expectation and most of the pros and experts will tell you setting win goals or stop loss limits are useless because poker is one big game with a few interruptions to eat sleep and work in between hands. It doesn't matter if you quit when you are ahead or losing, since will be coming back to the game eventually. They say that if the game is good it doesn't matter if you are down because you will win money back in the long run if you are a good player. I agree with this up to a point. I still think that you should have some sort of stop loss for each session.

The main reason I advocate a stop loss is for psychological reasons. If you are losing and suffering bad beats or just being dealt rag after rag hand, there will come a point where this will start affecting your mental game. When this happens, you are no longer able to play your best game. You may find yourself making poor decisions or playing hands that are below your standards. When this happens, it’s time to quit.

I suggest that you buy in for a reasonable amount of money. In a limit game, I will buy in for a minimum of 20 big bets. If I lose this, I will usually call it a night. If the majority of the loss came from losing only one big hand then I will evaluate the game and my own state of mind. I might take a break if I am going to continue playing.

Another factor I consider when deciding to quit or not is the length of time that I have been playing. When I first started playing, I found that I could not keep total concentration on the game for more that a couple hours. I then would limit my sessions to a certain time period and then quit whether I win, lose, or draw. Each of us has our own endurance level. Some people can play at peak performance for hours on end. Others might lose concentration after an hour. You have to decide what is best for you. One way to determine your performance level is to look at your logbook. Compare your win/loss record with your playing time and see if the amount of time you spend at the table is having an effect on the outcome of your play.

Whether you call it money management or bankroll management, it all comes down to being able to having the money you need to play poker and the skills it takes to be a winning player.