Many gamblers use the word ‘bankroll’ differently, and this confusion leads to bad game selection, misplaced risk aversion, and poor gambling decisions. When focusing too much on low minimum bet games, for example, you may be taking on a higher house edge and contradicting a goal of ‘making money last.’
Common Misunderstandings About Bankroll
What is a bankroll? I often read articles, tweets, and Facebook posts about the ‘bankroll’ someone brings to casinos, and how they are focused on ‘making their money last.’ However, they often miss the bigger picture of house edge, game selection, and variance or volatility.
As a winning Poker and Blackjack player, I’ve always thought of bankroll as the larger pool of money I can allocate to gambling over a long period of time, not just the amount of money I have on hand or will bring for a casino visit.
Bankroll Strategy in Poker
In Poker, I will often make higher-variance, higher-expectation decisions rather than lower-variance, lower-expectation decisions. Good bankroll thinking means making better decisions because they have higher long-term expectation, even if they carry higher variance.
With gambling, I take a long-term perspective and accept that it involves day-to-day losses, so I focus on my long-term expectation and make decisions accordingly, rather than playing sub-optimally or passively to ‘try to make my money last’ for a given day, week, or month.
Bankroll vs Gambling Budget
For casual or recreational gamblers, ‘bankroll’ is really shorthand for a trip gambling budget or amount they’re willing to lose. That may be fine in conversation, but it becomes a problem when people make inferior decisions in the name of protecting that bankroll.
I find it contradictory when gamblers say they want to make their money last, complain about table minimums, worry about bankroll, but then play games with high house edges and make side bets carrying high house edges.
Example: Minimum Bets vs House Edge
I recently spoke with someone who lamented what they considered a high minimum bet, $25, for good Blackjack rules, so they instead played Free Bet Blackjack with $5 or $10 minimum bets and bet the Pot of Gold side bet, which likely has a house edge of four to six percent.
Free Bet Blackjack usually has a higher house edge than ‘regular Blackjack’ and its strategy is likely more complex for most players, leading to a higher house edge due to strategy mistakes. Rather than betting a high house edge side bet in addition to a higher house edge initial bet, playing a $25 minimum bet Blackjack game with less house edge is the better decision, even if the posted minimum bet is slightly higher. A cheaper game is not always a better value game.
Understanding Expected Loss
If your goal is to ‘make money last,’ also consider not just the minimum bet, but also the house edge, and even the expected loss per hour in the long run, given an average amount of decisions per hour. A higher minimum bet game, with a lower house edge, can also be less risky when the table is busier and decisions are slower.
It’s important to revise and consider gambling goals, especially if goals or preferences are in conflict. If your goals are money longevity and value, think less about the short-term and the cheapest bet in the casino. Think more about house edge, the long-term, and game selection.
As always, gamble responsibly.
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