I started playing poker about 4 years ago, and quickly got addicted to the game. The strategy involved, and the thrill of the bluff were fantastic elements that kept me coming back for more.

Initially, we’d start off playing $20 buy-in tournaments. We then progressed to 25 cent/50 cent blinds and then to $1/$2 blinds. At one point, there was a foray into $2/$5 blinds, but people lost way too much money to keep the game friendly. Poker has gotten so popular, that in many circles, poker has replaced golf, or drinking as the client entertainment event of choice. I don’t recommend ever playing high stakes with clients. It’ll only end in tears and resentment.

Despite 4 years of experience, I would rate myself a very average poker player. The main reason for this is my fear of losing money and getting bad beat. A bad beat is where you have significant odds of winning, and you still lose. Pocket Aces all in vs. Pocket KKs means you are 80% favored to win. Yet, 20% of the time you lose, and it is the worst feeling out there. 2008’s World Series of Poker Champion won via a bad beat. He runner runnered (4th and 5th card) to catch his gut shot straight vs. his opponents AQ with a Q on the flop. How unlucky.

We play $1/$2 blinds, and the individual buy-ins have gotten progressively bigger while our individual net wealth have all gotten smaller. The average buy-in used to be $100, now it is $300, with pot sizes surpassing $1,000 on a regular basis. Yet, I still only buy in for $100 or less at a time, for reasons stated above. I can regularly take on $50,000-$150,000 stock positions, and yet I can’t buy in more than a measily $100, nor can I call a $31 bet when I have a flush and gut shot draw on the river if my odds are not correct.

I lost $200 bucks last night when my QQ call all-in lost to A-3 b/c my opponent caught a 10 on the river for a straight. How do you go all in with an A-3, I don’t know. I had QQ again and went all in for my remaining $65 bucks and lost b/c my opponent caught his K on the river. It sucks to lose, but all I can do is make the right bets, and hope that my odds hold up in the long run. Because if you play incorrectly and call or bet without the correct odds, you will eventually lose all your money.

If you decide to play poker, you must set a loss limit and walk away once you reach that limit. Don’t let revenge, or the mania of gambling get in the way of what you must do. You must walk away and regroup your mind, b/c a tilting player will generally tend to lose even more money.

Poker is a zero sum game. If you win, it’s at another’s expense. Do not rely on poker to fund your food budget, or pay your rent. I promise you, there will be sessions where you will lose all your money, and you start skipping meals just to save $5 bucks. Those “poker pros” you see on TV have all gone BUST AND BROKE at one point in their careers. Don’t believe the hype. you may get lucky and win a big tournament, but you’ll make much more money using that time to focus on your career and job at hand.

SIMPLE POKER STRATEGY

1) Identify the type of game you are joining. Is it a loose, or tight game? Generally, if it’s loose, play tight, and if it’s tight play loose.

2) Observe each opponent and characterize them in different buckets: Playing for Fun, Super Tight, Animal on the Loose, HotSh*T, or Ringer and play accordingly. Be cognizant of who you are, and what other players think you are.

3) Treat a $200 bet the same way you would treat a $2 bet. In other words, if the odds are in favor for you to put all your money at risk, do it.

4) Realize that poker is a zero sum game. You can only make money if you risk money with favorable probabilities. If you get bad beat, just brush it off and focus on the next hand.

5) Just have fun and don’t take the game too seriously. It’s when you start getting addicted to the game, going beyond your loss limit, and taking buses to the casino where you start getting into trouble. You may win a lot in a hot streak, but at what cost to your general well being?

6) Finally, If you really want to make money, you should probably target the one who’s just playing for fun (but that’s not cool), the animal on the loose, and the hotsh*t 20-something year old who think he’s so great. It’s important to feed their egos and make them think you are weak and timid. Just be patient, and let them talk and strut all they want until you have something to clean them out. When you win, just brush it off to luck and move on. They’ll never know what hit them, and really attribute their loss entirely to bad luck.

Related: Inside The Mind Of A Gambling Addict

Keigu,

Financial Samurai – “Slicing Through Money’s Mysteries”

FINANCIAL SAMURAI – INTRODUCTION

The Journeyman’s Goal To Financial Independence By 45

After 10 years in corporate America, I thought I had it made. A six figure job, a real estate portfolio, company stock, and a savings/emergency fund that would last me 3 years if I ever became unemployed.

I did everything the personal finance books taught us to do and I still lost 35% of my net worth in 2008-2009 due to the economic meltdown.  The financial downturn has motivated me to share my experiences to not only help others, but to keep myself honest in my spending habits.

FROM HUMBLE BEGINNINGS

My first job ever was at McDonald’s for $3.12/cents an hour. I was responsible for opening up the store at 6am every weekend for several months. The job was horrible, and we had a power hungry manager who scolded us for speaking Spanish and not English in front of customers.

At least I got a “B” in Spanish. I remember trying to make 9 Egg McMuffins at a time for 3 straight hours, adeptly cracking eggs left and right with both hands. It was hot, and oh the pressure was immense. Things weren’t all bad though. After-all, we could eat as many hot apple pies we wanted.

My parents never bought me anything too expensive growing up. They were frugal and made an average middle income salary working for the government. I never had a camera or a Nintendo console, but I did enjoy playing tennis with my father and listening to my mother talk about religion.

The most expensive gift I ever got was a 1987 Honda Civic with 140,000 miles for $1,800 bucks after doing well in HS. I’m truly thankful for this gift as I drove it until I graduated college.

Related: The Three Jobs That Made Me Rich

COLLEGE – Public All The Way

I had a choice between private school or public school for college, and I chose public school. There was no way I could feel comfortable allowing my parents to pay $25,000 a year in tuition alone, when there were plenty of top quality public schools for only $5,000 a year.

Besides, I planned to payback my parents and couldn’t stomach that type of debt. The $30 a day I made at McDonald’s had a more profound impact on me than I realized!

Related: Should I Go To Public or Private School? Depends On Your Guilt

STOCKS ARE VOLATILE

My father introduced me to the stock market in college. Through stocks, suddenly I could make much more money than through working at the library at now $4.5 an hour. Little did I know, that I could lose an infinite amount more money though! The taste of success came when I bought 500 shares of Books A Million (BAM, a now defunct Book Seller). The stock went up 25%, and I made $550 in 1 hour. From that trade on, I knew I wanted to do something in finance, where anybody with enough guts could make as much money as they wanted.

Related: Why Real Estate Will Always Be More Attractive Than Stocks

LUCK AFTER ENTERING THE WORK FORCE

When I first entered the work force out of college, things were explosively recovering from the 1997 Asian & Russian financial crisis. I got lucky and purchased a particular internet stock (VCSY) for $3,000. It shot up to $150,000 in three months and I sold, not at the peak of $180,000, but close enough.

Flush with cash in my early 20’s, I went kind of nuts, buying a motorcycle and a very fancy car. I’d eat at the fanciest restaurants in NYC and went on lavish vacations. When I changed jobs for a better opportunity, I finally woke up to the realization that I was just flushing my good fortune down the drain. I started to get serious about my finances. In early 2003, I sold my $80,000 car and used the proceeds along with the rest of the money left to buy my first 2/2 condo in a prime location in a big city. It is now renting out for positive net income, and I plan to pay it off within 8 years.

Despite this initial taste of success, I’ve made so many personal finance blunders in my 20’s, it wouldn’t be right not to share with you the errors in hopes you don’t do the same. Hopefully, through Financial Samurai, we will never have to say “if I knew then what I know now” as it relates to personal finance again.

Related: Your Wealth Is Mostly Luck! Stop Being So Pompous

WHY RETIRE BY 45?

Retiring at 45 is a “see if I can do it goal.” I actually really enjoy my job, but I think I’ll enjoy it more if I didn’t need to work! What’s the fun and challenge of choosing to retire at 80?  I might be dead by then!  Like studying for an exam, people tend to cram the week before. I want to cram now.  Essentially, I believe that if you can work for 20 years in your profession, you will have the power to retire if you want to.

One of my main motivations for writing is to interact with readers, so please feel free to comment!  I hope we can all grow rich together over these next 10 years!  Welcome to the journey!

Update 2020: I started Financial Samurai in 2009 and ended up retiring in 2012 at age 34, whoo hoo! I stayed retired and traveled around the world with my wife, played tennis, and wrote on Financial Samurai until 2017. Then, we had our first son! And in 2019, we had our first daughter.

We are now stay at home parents. However, kids are expensive and I’m thinking about going back to work to bolster our finances. We shall see! It’s been a great 10+ year run on Financial Samurai. I’m so thankful to have started when I did.

Related: My Financial Independence Masterplan: FIRE By 45

Financial Samurai – “Slicing Through Money’s Mysteries”

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SENSEI & PART-TIME EDITOR – INTRODUCTION

I’m in my mid-40’s and have reached financial independence through a lot of hard work, and a little bit of luck.  My net worth is in the multiple seven figures, and my primary residence is paid off.  With no debt, I still don’t live extravagantly, but I am living carefree.  All expenses are paid for entirely by my interest income from my cash savings.

Unlike many personal finance sites who have young writers with little financial experience, I’ve already made my money, and am happy to share my knowledge and opinions with you.  My belief is that you would rather take personal finance advice from someone who’s been there and amassed a good nut, than from a 25 year old kid in debt, making less than you!

Ideally, you already know the basics of personal finance, such as: 1) spend less than you make, and 2) pay yourself first.  I seek to discuss other topics, such whole life insurance, derivatives, and seeking tax efficient strategies.

Financial Samurai is a site where I will freely write about money’s great mysteries.  My posts will be straight from the gut and unbiased.  My passions lie in real estate, the stock market, and private equity investments.  I believe you must think big, to win big.  Risk taking is necessary, and is the only way to really achieve financial success early or ever!

Why “Financial Samurai?”

A Samurai is a noble, disciplined warrior who serves their citizens and fights with honor.  The world of finance is full of traps, taking tremendous skill and discipline to artfully navigate through the dangers.  Temptations are everywhere, and we will seek to slay them one by one.  Every now and again, we will be tempted to cheat the system like so many white collar criminals have done in the past.  Bernie Madoff and Ted Kozlowski have no sympathy from me.  They, along with all their co-conspirators should rot in jail, and then proceed to rot in hell.  As a financial samurai, you will never dishonor the system, and will righteously fight towards financial freedom!

I’ve known FS for several years, and we have decided to combine resources and share various opinions.  We are a lot alike, I’m just older.  As a team, we can reach out to a wider audience, especially those who have gravitated beyond the personal finance basics.  I hope you will find Financial Samurai to be fun, informative, and real.  We aren’t rich because of this blog and pretend to be less financially secure so we can better relate to readers.  We’re rich because we’re disciplined and understand basic necessities for financial freedom.

The secrets to wealth are quite simple:

* Spend Less Than You Earn

* Don’t be a weak spending fool on things you don’t need

* Come in first, leave last and work your hardest.

* Take calculated risks and press when the opportunity is right.

* Never invest in anything you don’t understand.

* Give freely, and give often.

Welcome to Financial Samurai!  Please sign up at the top right to get updates via RSS or Email!

Keigu,

Sensei @ Financial Samurai – “Slicing Through Money’s Mysteries”