Managing the Grind with Household Services and Expenses

In a previous post, I talked about some of the bookkeeping tips for poker winnings and tax accounting. That got me thinking about another kind of bookkeeping resource for poker grinders. Admittedly, I was single and semi-slobbish when I was a pro player, but contrary to the stereotype, I knew quite a few pros who had families or otherwise ran a tight ship at home even while juggling the poker lifestyle. Naturally, some had spouses who took care of the house, but others would make use of domestic workers to keep the place tidy. Everything from maids to nannies to personal chefs. Some of the more successful and established players might employ butlers or gardeners.

Indeed, some poker players undoubtedly used these workers to meet their logistical needs, while others could more easily afford to add the convenience that these employees provide. But it also makes me think of a study I was reading about in the news recently that spending money on time-saving services tends to create more happiness and value than spending money on things. This, too, is a great poker lesson that applies to other aspects of life. You have to account for your winnings and losses, as well as the time you spend at the poker table.

 

Household Employee Bookkeeping

These types of workers create a niche need for bookkeeping services among professional poker players. Due to the odd hours and somewhat unpredictable nature of the grinder lifestyle, it may be impractical to integrate common housecleaning and babysitting services into your schedule. Finding someone you trust to watch the kids late into the night isn’t easy. Someone who can housesit for the weekend while taking care of the dogs and doing handyman projects isn’t available on every street corner. For the perfectionist, detail-oriented, slightly anal poker player, you can also give these workers more individualized care instructions whereas commercial services tend to use their own “packages” with a predetermined list of services.

But crucially, no matter your personal motivation, the IRS will likely count these household workers as employees with W-2 filings, payroll taxes, and income withholding. Here’s the good news: Unlike regular business employers, you don’t need to track, file, and pay the payroll taxes every month. 1040 Schedule H enables you to do this on an annual basis. I recently talked to someone from the old network, and they recommend AMS as their go-to for payroll software and just general 1099/W2 type stuff. Don’t know if they are the best or worst, but it has worked well for me and my friend who recommended them. If you know of something that is better or cheaper, I’m all ears.

 

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Recognizing and Exploiting Others’ Confirmation Bias at the Poker Table

In a previous post, I discussed how to recognize and manage your own confirmation bias at the poker table. I wanted to follow up those thoughts with a different approach to confirmation bias, namely exploiting your opponents’ bias at the poker table. In many ways, I’ve found this to be an even more productive exercise than trying to manage your own confirmation bias, which has limits and trade-offs that must be continually whittled away at through the breadth of your experience.

 

Representing, Storytelling, False Tells, Confirmation Bias: It’s All the Same

All these phrases are really interconnected as different aspects of the same strategy. Part of optimizing your play is to know when to change gears and vary your tactics so that you don’t become too predictable, but within the course of a single hand, one of the critical questions is always what information are you providing to your opponents? The order (which round of betting) and strength of the information (the size and nature of the bet) create an information trail that gets turned into a story (with a beginning, middle, and end) told to your opponent about the strength or weakness of your hand.

Knowing what hand you’re representing in the mind of your opponent is absolutely critical. It helps you recognize when a bluff is more or less likely to be successful. For those players who have developed false tells, recognizing the larger narrative and the pot stakes can help you choose the best time to deploy these tells and without necessarily revealing the false tell itself. More to this point, while managing your own confirmation bias takes time and experience, exploiting your opponent’s confirmation bias can be achieved more quickly through a combination of intuition and acting skill.

This general strategy also explains one of the things I like to say about the progression of learning poker. Beginners try to play their own hand. Amateurs try to play against their opponent’s hand. Professionals play against their opponent’s perception of their hand and yours.

 

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Recognizing and Reducing Your Own Confirmation Bias at the Poker Table

For those who don’t know, confirmation bias is the tendency to look for, interpret, remember, and give extra weight to data that confirms one’s preexisting beliefs and assumptions. It’s an idea that’s commonly applied to different spheres, from politics and religion to psychology and game theory including poker.

Confirmation bias shows up at the poker table all the time. You put an opponent on a flush draw that you miss or at least devalue the possibility that he or she may have hit the straight on the river. Sometimes, this occurs even when you make the right read at the beginning. An opponent who’s making a pure bluff before and after the flop ends up betting big on the river. This can look like a continuation play of the previous bluff, but can you seen the subtle signs that something isn’t quite right about how that last bet went into the table?

Of course, confirmation bias is just a tendency, and you don’t want to start reacting too strongly in the other direction. Sometimes (many times?), it’s not your biased perspective of the evidence, but actual evidence that’s pointing to the right conclusion. In fact, at times, I’ve even found what I call meta-confirmation bias in my thinking. In other words, I would get so locked into an interpretation of another player’s strategy from the beginning that when there was an alternate theory, however unlikely, I would start to give it more weight than it deserved.

 

Conceptual Understanding vs. Repetition and Experience

At this point, it’s easy to throw your hands up in the air and, say, well, what good is this advice then? Indeed, while it can be easy enough to understand the concept of confirmation bias, it’s a different story putting it into practice at the poker table. It’s all that much harder to refine your skills when there’s so much statistical noise at the poker table between getting rivered or running hot or always picking up rags. But I assure you, over the long run, being aware of these psychological forces can pay off in the quality of your decision-making and play at the poker table.

Okay, but how? While it’s beneficial to understand how confirmation bias works in terms of accelerating your learning process at the poker table, to truly develop and improve your skills, you need to sit down at the table and play. A lot. The more times you see a particular betting pattern, the more times you’ll be able to pick out the few times in which this pattern doesn’t mean what it should. You’ll get better at recognizing when something smells fishy about a play you’ve seen a hundred times before.

It’s just like anything else, the more you practice, the better you’ll get. This is supposed to be especially true of no-limit hold ‘em and one of the reasons it’s known as the Cadillac of Poker….because it costs a Cadillac to learn how to play.

 

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Bookkeeping Tips for Grinders: Document Your Losses to Offset Your Winnings 

Come tax time, you’ll need to collect, organize, and report your various income and tax forms to the IRS and state government. But long before the filing forms start arriving in your mailbox, you need to keep reliable documentation of different aspects of your gambling and poker activities. For the time being, I’m going to side step the various ethical and legal issues that come with reporting various types of poker winnings. (If you’re interested, you can read more about these issues here.) Instead, I want to focus on the biggest and most common mistake you can make: Failing to document your poker losses and legitimate business expenses.   

Here’s the deal: When you’re in a Las Vegas casino or some other institutional poker setting, that institution is going to document and report any winnings of a certain size. What they’re not going to report is any losses and expenses you also incur. Crucially, these losses and expenses can be used to offset your gross winnings and taxable income. If you play in casinos, these expenses include basic travel expenses. If you play online, these expenses include your computer, internet charges, and other telecommunication costs. You can even deduct the cost of any poker books and training materials that you purchase.  

Depending on your circumstances, tax filings can get incredibly complicated. Poker tax accountants cater to this crowd. Don’t let an institution give you excuses about providing these filing forms. Nowadays, comprehensive accounting software must include support for Form W-2G. You have every reason to expect to receive this form in a timely manner.  

 

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Projecting Weakness vs. Allowing Strength

Whether it’s pocket aces or flopping the nuts, one of the skills that’s important to develop as a poker player is what to do when you have a monster hand. The primary calculation here is how to extract the most chips. (Depending on the situation, you also need to be mindful of getting blind-sided. Just how stone-cold are your nuts? If the worst-hand in poker is the second-best hand, it’s especially cruel when the second-best hand used to be the best hand possible.)   

That said, there’s still a ton of nuance involved just by focusing on extracting the most chips possible. The check-raise seems most natural, but projecting this much strength will also end up scaring off a lot of would-be bettors. Many pros will bet-out in the hopes of disguising their true strength, while also growing the size of the pot. If the opponent folds, you can legitimately question how many chips they were ever going to put in the pot anyway. The check-call also has the advantage of ensuring you keep the opponent on the hook for at least another betting round. Your opponent may perceive weakness on your part and potentially increase the strength of their own hand inducing them to bet on subsequent betting rounds.  

The board also plays a role in the relative wisdom of each type of decision. If you’re holding a pair and you flop the top set, for example, it’s essential that you look at the rest of the board. If there are straight and flush draws already on the board, I’m more likely to bet-out. If there are limited or no flush and straight draws on the board, I’m more likely to check and see if my opponent will make a bet. Even still, the advantage of any particular strategy is muted by becoming too predictable in your play overall.  

So, how does this principle apply to other areas of life? Well, let’s say you’re dealing with office politics and that always touchy subject of taking and getting credit for your work. You want to make sure you get your due credit, while also seeming like a team player, right? This is why I like to consider the relative ease or difficulty in someone taking credit for my work. Simply put, if I know it would be extremely hard or risky for someone to take credit for my work, I’m more likely to get my head down and wait for someone to notice with the intent of getting extra points for my discretion. Conversely, I’ll be more on the lookout for opportunities to mention my work when I think there’s a danger of someone butting in.  

 

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What Poker Teaches Us about Luck 

No doubt, there are dozens of different ways I could talk about the intersection between poker and luck. But one of the things that’s always resonated for me, and continues to resonate, is how often bad luck first appears to be good luck, and vice versa:  

 

“When the gods wish to punish us, they answer our prayers.”

“The worst hand in poker is always the second-best hand.”

“You’re never as high or as low as you think.”

 

You hit the flush on the river only to have your opponent hit a full house at the same time. You can say that you should be able to make a great laydown, but come on. Sometimes, it is pure luck, and it’s a roller coaster ride. You get all your money in with a pair of Ks, only to go up against As. You spike yours on the flop, they spike theirs on the turn, and it all ends up as a split pot with Broadway coming on the river.  

So, it is in life. Part of you has to be ready to accept the good fortune and endure the bad fortune, but another part of you has to be ready to question whether the good luck is really good and whether the bad luck is really bad. Sliding Doors is an underrated movie, by the way.  

 

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How to Use Data to Pick Your Spots

Many successful poker pros spent months, or more often years, being a grinder. The term can mean a few different things. In one sense, it refers to the mental grind and general stress of earning a living by playing poker. Indeed, it’s tough enough to consistently make the best decisions possible at the poker table without also having to think about whether the river is going to make it a dicey proposition to pay rent and still have stake money. There’s a reason that poker chips are frequently talked about as ammunition. It’s odd because the poker chips actually do represent real money, but I agree that it can be poisonous to the poker player and the decision-making process to see chips as your food and housing costs.  

 

Keep track of each hand. A lot of professional poker players and serious amateurs take notes at the poker table. This is a great practice that can help refine and continuously improve your granular decisions, both during the session and afterward. The simple ability to accurately remember exactly how a hand played out is itself an important resource. Somewhat surprisingly, it also helped me not to dwell for too long on any hands that got to me a little more than it should have.  

I’ve also found the act of note-taking helps create a table image that accentuates other players’ tendencies. In other words, in my experience, taking notes at the poker table made tighter players play even tighter and looser players even more aggressive. But I would also have a corner of the page reserved for doodling so that I could pretend to be making notes when I really wasn’t. 

 

Keep track of every session, too. Being a grinder can also refer to a poker player who tries to pick their spots in such a way that they have a consistent advantage and can reliably walk away ahead even if the winnings aren’t that big. What I learned after being a grinder for a while is that you should also track certain data points for every one of your sessions. Some of the information I kept track of were: Game (style), Stakes, Take, Total Hours, Take/Hour, Site and Play. Play was a subjective ranking of whether I thought the table was normal, tight, or loose.  

Most people talk about picking their spots in that they feel they consistently held an advantage over the table. Okay, but this isn’t the whole story. I had one fellow grinder friend start using this spreadsheet approach, and he discovered that not only was he was making more money per hour playing at a higher-stakes table, he was more consistently ahead when playing slightly higher-level competition. For a while, I also tracked my performance hour-over-hour to see if I had better results at the beginning, middle, or end of a session. I didn’t get a lot of insights, which surprised me. I figured, either my read on the table would improve or mental fatigue might set in or something else. 

Anyway, it’s this two-pronged approach to picking your spots that I found most effective for maximizing my time at the poker table overall. Interestingly, of the two approaches, I think keeping track of each session was more important. But maybe this is because replaying individual hands also comes more naturally to the typical poker player.  

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Who is the Poker Inspector? 

Hi, my name is Drew, and I was a poker grinder in the truest sense of the word. I played poker for a living for the better part of five years during and just after grad school. I made enough to live on, but not especially comfortably, and while I did have a decent chunk of change when I left, it was far from life-changing money.   

I was never that next-level genius, but I had enough math skills to do any number of things. The hitch was that I liked people too much to dwell in such an abstract world. Or at least I was too interested in people to relegate myself to the world of numbers. Yes, I get that math is everywhere in the real world and the poker table even more so than many places. This was always part of the appeal, but the restless nights I spent after a particularly frustrating session were often more about the style of play and the personalities involved. I wouldn’t say I took these moments personally, but it was the human element that was the puzzle I would keep turning over and over like a Rubik’s Cube. 

In fact, in many ways, poker had started to feel like this kind of pure math, and this was a big factor in why I decided to leave. For a long time, the grind was about the external goals of making a living, building up my funds, and working toward that day when it wasn’t such a grind. But then, the grind itself became a grind. I don’t know if poker was ever truly going to be one of the great loves of my life, but it was becoming something I actively despised or dreaded. A couple times near the end, I left the table a lot earlier than I planned just because it was getting so hard to maintain sufficient concentration.  

In retrospect, I think I left just in time. After a couple years away from the poker table altogether, I was invited to a couple home games with friendly stakes. It was a different experience altogether and not just because I wasn’t grinding anymore. It was just such a natural and effortless way to get to know people. It was poker as a means to an end, not an end unto itself. This led me to start thinking about how poker has so much to offer both the amateur and professional player in terms of insight about life in general. This site explores how you can use poker odds and the rules of engagement to make a better living, but also to just live better.  

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