Life Is a Texas Hold ‘Em Tournament

Monday, March 31st 2008 by Shanel Yang

Life is a Texas Hold ‘Em tournament. You may think you’re not playing, but you are. As long as you’re alive, you have the stack of chips that life gave you, plus or minus whatever you’ve managed to do with that original stack, and whatever pocket cards you get dealt by the dealer at the start of every new game.

There are a lot of games in a tournament, just like there are a lot of decisions in life. You have to make a decision. Even the decision to not make a decision is a decision.

With every new pair of pocket cards you get dealt, you’ve got to decide whether to play that game. If you play too safely by waiting for only the very best cards, you will slowly lose all your chips because of the rule that you have to put up at least one small blind and one big blind every complete rotation of players at the table. Life is like that, too. If you wait for the best deals to come along before you make your move, you will slowly lose every opportunity to win and, thus, ultimately, lose everything.

The opposite of the player who is too careful is the player who is too risky. There are two kinds of risky players. The first type loves to play almost every hand because they just can’t pass up a chance to win. The second type tries a lot of different half-baked strategies, partly to throw off the other players (which only works to weed out the other bad players), but mostly because they don’t really have a consistent game plan. This second type usually loses early in the game after going “all in” with the wrong cards.

RISK AVOIDERS LOSE EVERYTHING SLOWLY

If you are great at saving money but don’t take enough risks in your investment strategy, always waiting for the perfect deal, then you are like the Hold ‘Em player who is slowly losing everything you have—to taxes, inflation, and lost opportunities.

A good example of this is a friend’s dad who inherited several pieces of residential rental properties when he was a young man. They were really too much for him to handle by himself. But, instead of selling a few of them to make his and his family’s life a little easier, he stubbornly kept all of them and even mortgaged some of them pay for necessary repairs and maintenance. The real estate market fluctuated to record highs and record lows while he held on to these properties. There were some interested buyers over the years, but he refused to sell. It’s hard to say why he preferred to go into debt rather than just sell one or two. But, he’s a proud man. Maybe he thought he could have his cake and eat it, too. Or, as all proud men are, maybe he was too afraid to make the wrong decision and, thus, chose to do “nothing.” But, his decision to do nothing cost him a lot: a lifetime of worrying and spending all his spare time fixing or managing his properties just to avoid making a regrettable decision by selling one of them.

This man could have turned his small fortune into a comfortable one and made himself and his family financially worry-free. But, his fear of regrets immobilized him. He and his family had to work hard to keep these properties in rentable condition. After so many decades of hard work and worries, he is an old man with old properties in a nightmare real estate market. Now, all alone because his wife passed away and his children have their own families and money problems, he continues to struggle to make the hefty mortgage payments to avoid losing it all to the banks.

RISK LOVERS LOSE EVERYTHING QUICKLY

On the other hand, if you jump at every opportunity to make money quickly, you won’t have enough when the right opportunities suddenly present themselves. A good example of this is moving your money in and out of stocks, gold, coins, art, or whatever else might be the latest “hot” investment, just because everyone else is doing it. This is like the Hold ‘Em player who can’t resist playing almost every hand in the overly optimistic belief that they might still get the two cards that would complete their straight or flush. They fail to consider that good players who stay in the game usually do so because they already have great pocket cards.

An example of great pocket cards in the investment world is inside information or a solid background in the type of investment you are considering making. Another example is more than one way to make money on the deal, which is like having several “outs” in poker (ways to make a winning hand) depending on what comes out on the “flop,” “turn,” and “river.”

The other type of risk lover, the ones who like to go “all in” early in a game, they are similar to investors who put all their eggs in one shaky basket. Not a good idea.

WHAT’S A SMART POKER PLAYER TO DO?

Learn the rules of the game. Learn the odds and the outs. Watch a lot of players before you start playing yourself. Practice playing without putting up any big money at first with the goal of eventually putting up bigger money later when you really know what you’re doing. Never play “just for fun.” Would you invest your money in something “just for fun?” No, the point is to win. In poker and in investments, you win when you make money from doing it.

Since I was a girl, I stayed away from poker games. Trying to remember what all the different hands were, and what trumped what, was hard enough. But, my mind just went dead trying to remember what cards everyone threw away during a game, to try to figure out what potential combinations of hands still remained in the deck. No thanks! I rationalized to myself that my then-perceived lack of math skills was excuse enough to never play that difficult game again. But, I secretly wished I could be good at the romanticized card game from the wild, wild west.

In 2004, I started playing Texas Hold ‘Em because my coworkers had a weekly game. They were nice enough to invite me a few times, so I decided I would at least go and watch one night. There were other women there who had never played the game before, and they were brave enough to try it. The first thing I realized as I watched them play is that Hold’ Em is a lot easier to learn to play than stud poker. Even the more experienced players, mostly men, seemed to have no real advantage over the women. I quickly joined in the fun. I guess I’m more of a risk lover than a too-safe player because I took too many risks too soon.

But, I didn’t give up. I decided to teach myself how to become a better player. Ken Warren’s Winner’s Guide to Texas Hold ‘Em: The Smart Player’s Guide to Winning At Hold ‘Em was the best book I found on the subject. I studied it and applied its lessons to my game. Pretty soon, I was making it to the last two or three players every time I played with friends. But, I found out that I usually lost very late in the game. That’s when I realized that I played Hold ‘Em like my dad ran his business.

My dad started out taking the right kinds of risks at the right times. He worked hard. He reinvested his profits, taking more calculated risks, until he built a nice, fat stack of assets. Then, in the eleventh hour, he suddenly lost interest. He let it all slip away. He got bored. So, he got sloppy. I got that way, too, after too many cocktails and too much greasy, salty snack foods while playing the game. In the wee hours of the morning, a part of me just really wanted to end the game and get some rest. But, that’s no good for winning—in poker or in life. You have to stay alert all the way—fresh all the time. So, I stopped drinking and eating during games. After that, I began winning the top position consistently.

CONCLUSION

Getting good at Hold ‘Em did wonders for my self-esteem. Not only did I prove to myself that I can be a good poker player, but, more importantly, I learned I can be a good investor, too, because the steps to success for both are the same:

1. Get educated so I can recognize the right calculated risks.
2. As soon as I see opportunities for taking the right calculated risks, take them.
3. Keep my eyes on the prize. Don’t get bored in the eleventh hour.

In fact, these steps to success apply to all goals in life, not just investments. That’s why I say life is a Texas Hold ‘Em tournament. Play to win and you will feel the incomparable thrill of success and the immeasurable self-esteem that comes with it. Play “just for fun” and you will always wonder what it feels like to really want to win at something, work for it, and succeed. You choose.

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