9/29/2010--The tyranny of the urgent

I'm still having some good runs in MTTs, well into the top 1% of the field, and I'm getting some small cashes. When I don't cash and the bankroll starts to drop, I shouldn't have a problem making a few bucks playing small SNGs to keep the bankroll from dropping too far. I think I'm going to play a lot of small SNGs (mostly STTs, single table tournaments) to keep the bankroll from falling below a certain point. I plan to grind it up to $50 playing SNGs, while still taking a few shots at the MTTs.

However, a few days ago I realized that I don't really have a plan for what happens when I get my next big cash. Let's say for purposes of discussion that I get a $500 cash. $500 is a nice round number, and is there is a $1.10 tournament currently running where 3rd place is $572, so it's not an unreasonable number.

There are a lot of important things that I could do with that money, and, as I'm not contributing much to the family income (I get a small monthly retirement check from the Michigan National Guard), I definitely need to do my share in paying the bills. The problem is that since things are tight for us right now, I risk the danger of falling victim to the tyranny of the urgent.

Tyranny of the Urgent is a brilliant essay written by Charles Hummel in 1967. It is still in print. Hummel says that we are so busy dealing with the "tyranny of the urgent", such as phone calls that we can't or won't ignore (if this was written in 2010, it might have been titled The Tyranny of the Tweet) , or the crisis of the moment at work or home, that we don't take the time to deal with the things that are important--and "urgent" and "important" aren't always the same thing.

That's kind of where I find myself. Paying our bills is urgent. Having food in the house is urgent. But is it really important?

Things are tight, but we're playing the rent. We haven't missed any meals. We are slowly but surely paying down some debt, with the goal of being debt-free and doing everything on a cash basis in the not-too-distant-future. On the other hand, there are things, such as auto maintainance, that we are putting off, and that needs to be addressed.

But one thing is certain. Unless I build my bankroll, and keep building it, I will never generate a decent income playing poker.

Not being able to play anything above $1 tournaments really puts me in a box. There are very few MTTs with a good structure. At higher limits, the choices are much better. Even the $2 level offers much better options than $1, and the higher you play the more (and better) choices there are available.

In addition, as with any business, poker has expenses. I need to keep current, and poker books aren't free. My subscription for Holdem Manager needs to be renewed once a year. Many of the players who have started at the bottom and climbed up to high levels quickly credit their success to online coaching sites, which is not an option when I'm trying to hang on until I get a big MTT cash.

There is another important consideration. I haven't played any live poker in several months. Many of the fields where I play are very weak, and if I played semiregularly, I think that my hourly expectation would actually be higher playing live. Of course, overall I would still make more money online, since live there are only a few live tournaments a week, and they are available only at night. Live tournament specialists don't have the ability to grind for 12 hours a day, but there are some online players that do that.

All that said, how should I divide up that $500 cash? Honestly, I don't know. But there are some things that I have decided:

1. Building my bankroll is the highest priority. With a bankroll of $114 I could starting playing $2 tournaments, and roughly every $55 added to my bankroll would move me up a dollar in buy-ins. So I think I would take $100 right off the top from that first big cash, leave it in my PokerStars account, and build my bankroll to get things going.

2. With my first big cash, I might take out enough to take two shots at live tournaments, which would take about $100, with the idea of building a seperate bankroll for live tournaments. The bottom run of live tournaments, usually around $30, is more expensive than online, but of course, the payouts are correspondingly larger. The minimum cash for a small $30 live tournament would be around $50).

3. Ultimately, I would like to budget, by percentages, based on my monthly income. I can't forget that when self-employed in the US, 30% should be set aside for estimated tax payments. And I don't want to be making any decisions based on the emotion of a family situation, or the excitement of a large cash. Managing an irregular income is difficult for a lot of people, so I want to have a plan before I have to make those decisions, partly to avoid the tyranny of the urgent.

So, once it's rolling, I do know that very few players are successful if they withdraw more than half of theit poker income (other than for saving or investing) so I definitely have to keep that in mind. I don't know what the percentages would be, but for now I would be allocating to something like the following categories (in no particular order):

taxes 30%
bankroll building
owner's capital (amount taken out of a business for owner's salary or other personal use)
family expenses
business/office supplies
live bankroll (until it becomes self-perpetuating)
poker books and magazines
subscriptions (only Holdem Manager for now)

Later, when things are rolling, I might add other categories, such as:

hardware and software
office furniture
more subscriptions, such as coaching sites

But for now, it's back to grinding the SNGs.