The Poker Cashout System: Jackpots and Rewards!

Commonly mentioned but often forgotten, bankroll management is one of the skills that many poker players always talk about improving but never take any steps toward that goal. We always hear about the players who find a huge rush or hit a big score and end up right back where they started. These players might make a big withdrawal but then try to play stakes that their bankroll can’t support, or they believe they can take the next step and lose all their former profits chasing that next heater.

How is it that these players end up repeating these same mistakes over and over again? As with most things in life, they have failed to have a plan for cashing out a reasonable profit over time. This is precisely why using a cashout system can be so effective.

What is a Poker Cashout System?

A cashout system allows you to maintain a balance between managing your bankroll regarding its growth and the games you can play within your bankroll. And, importantly, it will enable you to pay yourself as you go.

Emphasizing Volume

The main key to the poker cashout system is volume, or in other words, the actual amount of games you play. The more games you play, the more you would pay for your play. This is done by withdrawing a set percentage of the buy-ins you spend for each Sit-n-Go (SNG) or Multi-Table Tournament (MTT) you play. Notice I haven’t mentioned anything about how much you’ve won. Your long-term profit will be the main force behind your bankroll growth.

How is this done? But, you pay yourself a certain percentage of the buy-in of a particular game based on the size of that game. The rate you would earn would be higher for the larger MTTs while being relatively smaller for single-table games and smaller multi-table SNGs. This is because the largest scores come from the larger tournaments, while smaller games must be ground out over time to generate the same amount of actual profit.

Example Percentages

Generally, you would want to pick a percentage that is no more than half of your expected ROI for that type of game. Often, you would select a number a bit lower to grow your bankroll more aggressively over the long term. For example, you might break down the percentages you pay yourself in the following manner:

• Heads-Up SNGs: 1%
• Single Table SNGs (3-10 players): 3%
• 18-Man SNGs (11-20 players): 4%
• 45-Man SNGs (21-50 players): 5%
• 90-Man SNGs (51-90 players): 6%
• 135-Man SNGs (91-150 players): 7%
• 180-Man SNGs and MTTs (151+ players): 8%

I’ve always used 3% as my payout percentage for all the 6-man and 9-man SNGs I’ve played, just like in the list above. If I were to play a $55 SNG, I would “earn” $1.65 for that game. I pay myself this same amount every time, regardless of the results for these games, no matter how many I play. My goal in these games is to make at least a 6% ROI so that I not only cover the expense of my cashouts but also leave the rest of that profit in my bankroll so it can grow. By doing that, I can work my way up to higher games, assuming I have the skill level to beat the games my new, larger bankroll can afford.

How Does it Work in Practice?

Let’s assume I have a bankroll of $4000 to start with, and I use 65 buy-ins as our bankroll requirement for SNGs. I play exactly 100 of the $55 SNGs over some time and end up with an ROI of 1%, meaning I profit $55 over this sample size. My bankroll would then be $4055. If I use a cashout system that requires I pay myself 3% of my buy-ins, I will cash out a total of $165 ($5500 x .03). Even though I turned a profit, my actual bankroll would go down to $3890 ($4055-$165). As you can see, if I fail to turn a high enough profit, I’ll eventually be forced to move down in stakes until I find a level where I can at least maintain a bankroll while still paying myself for my play.

Advantages of Using a Cashout System

The main reason is discipline. Players will often hit a bad streak due to bad beats, bad play, or some combination of both. In their rush to win back what they’ve lost, these undisciplined poker players often play in higher stakes games, hoping to hit that rush at the right time and make back what they’ve lost (hopefully more!). Instead, they usually find themselves over their head in a game full of players with more skill than they can handle and end up in an even further hole… or bust.

Steady Income and Motivation

Another advantage of a cashout system is that you will always see something coming from your effort. Since you pay yourself based on the number of games you play, like piecework, you will always see money coming from your poker playing and into your life. Even when things might not be running well on the tables, at least you know that by putting in the time and effort, you’ll receive something from that effort. A consistent stream of “income” from poker will positively affect your long-term outlook and reduce the stress of “having to hit a big score” so you can afford to withdraw your bills or pay for a vacation.

The cashout system can also help a player’s motivation. All of us hit dry spells and downswings, and often, it can be tough to sit down and play for hours on end when it feels like the world is out to get us in every way possible. However, knowing that you will be paid by volume, not expected profit, can help temper these tough times and keep you going. While some players will be stressing over the idea that they have to win so they can eat, we’ll know that all we have to do is keep playing enough volume to reach our income goals. The winning will come on its own through our skilled play over time.

Pay Yourself Anything Based on Volume

Other than cashing out based on a percentage of your buy-ins, you should also pay yourself any money you receive based on volume. TAnyVIP rewards you might earn from the online poker sites would be cashed out. Since bonuses are cleared based on the amount of rake you pay to the site, bonus money would also be part of your cashout. If you receive anything of value because of how much you play poker, not how well you play, it should go into your cashout.

Using the Cashout System as a Planning Tool

Planning your minimum income expectancy is also much easier when using a cashout system. If you decide to bring in a minimum of $300 per week by playing poker, you can determine just how many games you need to a certain buy-in level and size. For instance, to make $300 a week, you could play 500 SNGs at a $20 buy-in each. If you receive any bonuses or rakeback, you could calculate how much of those you would earn. As mentioned in the paragraph above, these are volume rewards. You would get to pay yourself that money and then determine that you could pay less to make that same $300 a week. You could do this for planning each week, month, or even an entire year if you wanted to since everything would be based on how much you can play, not on how much you have to win.

For the Pros and Grinders: Ceiling Cashouts

For the poker pros and major grinders, bankroll growth might be of minimal importance. Some poker players have already gone through this stage and are simply grinding out their best games over a long period; for these players, a ceiling cashout could be used to pay themselves a large portion or all of the profit they might make above the base cashout they would normally take.

Illustrative Scenario

Let’s take a 180-man SNG grinder with a bankroll of $6000. For now, he is content with grinding out a living playing the $12 games but does want to be able to add the $36 games sometime in the future. This player might place a soft ceiling on his bankroll of 50%. This means that after he pays himself his normal cashout, he’ll pay himself a “commission” of 50% of his remaining profit, then leave the rest alone as bankroll growth. Once he pays that ceiling cashout, his new bankroll number becomes his “ceiling.” He doesn’t receive a ceiling cashout if his bankroll is lower than his ceiling number. Your ceiling will always be the same as your bankroll’s career high.

Implementation and Considerations

A player may go several weeks before breaking his ceiling again; other times, he may do it for several sessions. In using a roof, it is important to realize that a ceiling number doesn’t often move very much and can sometimes hold at the same level for long stretches during bigger downswings. This is where properly bankrolling the games you play and grinding is crucial to being a successful and profitable player.

Is the Cashout System For You?

Yes, everyone can use it. You don’t have to be a poker pro or a grinder to take advantage of what a cashout system provides. Even a very casual poker player who wants some structure and guidance in his bankroll management can apply what has been discussed in this lesson. While not all players will always profit, everyone can benefit from the system.

In short, remember that anything you receive strictly because of how much you play and not from actual winnings should be paid out to yourself. Any profit (earnings) you have left over after paying yourself a cashout would stay in your bankroll. Put, your bankroll growth is your profit, fewer volume cashouts. As long as your profit outruns your cashouts, your bankroll goes up at a pace that generally keeps up with your skill level.

Conclusion