Blackjack Bankroll Management

blackjack bankroll managementBy playing blackjack without trying to overcome the house edge, you’ll slowly but surely lose your bankroll. This is why having a good blackjack bankroll management is important. It gives players a money strategy to continue playing, while minimizing losses.

You can do many things to reduce the house edge and even a few that can help you play a break-even game, or make money in the long run. Every small amount you change the edge requires a certain degree of effort, so it’s important for you to understand exactly how much your effort is worth in the long run.

To help you understand the numbers, and to help you determine what tactics you want to use we’ve put together this page about blackjack bankroll and money management.

You need to understand one thing before continuing, many books and systems have been sold claiming you can beat blackjack or other casino games using only money management. Money management is a tool to help you make decisions and play longer, but it can’t be used alone to beat the casinos.

Blackjack bankroll management alone is not enough to beat the game.

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Blackjack Bankroll Management Lessons

The first thing you need to learn is how to determine your blackjack bankroll needs based on the house edge and how you play accordingly. We’ll do this through a series of examples.

After you learn how to determine your blackjack bankroll management needs, we’ll cover the steps you can take to change the house edge and, in turn, change your bankroll requirements.

If you play a game that has a consistent house edge, without changing anything, you’ll never have a large enough bankroll for blackjack.

playing blackjack

Lesson #1: Playing With No Strategy

Most blackjack players don’t worry about playing the right way or finding a strategy to help them play better or finding anything that can help them break even. They simply sit down at the first blackjack table they see and start playing.

A player like this gives the house an edge of around 3%. Here’s how much you need for a playing session or trip if your average bet is $20 and you play 50 hands per hour. If you play a different average wager you can simply plug your amount into the formula below.

Expected Loss Rate

The first thing you need to do is figure out the expected loss rate per hour. This is a simple calculation. Convert the percentage to a decimal by moving the decimal point two places to the left. So 3% is .03. Then multiply this by your average bet and then multiply by hands per hour.

.03 X $20 X 50 = $30

This is the average amount of money you’ll lose per hour playing this game. In the short run, you may lose much more per hour or much less. You can even win for a few hours, but in the long-run the casino will wear you down. If you plan to travel to a casino for a blackjack trip you can use this information to determine how much you need to take to gamble with.

On a three day trip if you plan to play six hours a day it’s a total of 18 hours. This makes your expected loss $540.

Calculating Per Day Bankroll

Since your results will vary in the short term, you should take at least twice your expected loss for your trip bankroll. You should also divide your bankroll into three equal parts, one for each day. If you run out of money during any given day, stop playing.

If you take $1,000 for your three-day blackjack bankroll, play with $333 per day. If you have a bad run and lose all $333 in one day stop gambling until the next day. On the other hand, if you have a good day, you can add your winnings to the next day’s bankroll if you want. Or you can pocket your winnings and play only with the next day’s bankroll.

When you play blackjack or any other casino game, you need to make sure you’re a member of the player’s club so you can earn comps for your play. While comps usually aren’t in the form of cash, they still can be worth quite a bit. If you get free meals and / or hotel rooms it’s better than paying for them yourself.

Here’s one way to handle your three-day trip that can give you a great chance to come home with some money and have a great time.

At the Casino

You decide to take $350 per day for gambling and if you have any money left at the end of a day, you’ll pocket it and not risk it the other days. You’re a member of the player’s club so you earn comps while you play.

On the first day, you have a great run at the table and end up with $500 at the end of the day, a profit of $150. The second day you lose your $350 bankroll and stop playing. The third day you run hot and cold and end the day with $200. So you end up with $700 from your original bankroll and you earned a free buffet each of the three days and a free hotel room for a night on your next stay.

While your trip still costs money just like most forms of entertainment, you come home with a big chunk of your bankroll and the next time you go to the casino you get a free night. If you go twice you could earn two free nights, making your third trip lodging free.

Now let’s look at an example where you take some steps to reduce the house edge.

blackjack strategy

Lesson #2: Playing With the Basic Strategy

You still play for an average bet of $20 but you use a basic strategy card and you find games with decent house rules. By taking these two simple steps you play games with a house edge of a half percent. So here’s the new hourly calculation.

.005 X $20 X 50 = $5

Isn’t it amazing what a couple simple steps do to your expected hourly loss?

Basic Strategy Helps Reduce House Edge

By using a strategy card and playing good games you go from an hourly loss of $30 all the way down to $5. Every blackjack player should follow these steps because they’re easy and free. You don’t even have to buy a blackjack strategy card. You can print a chart for free on our blackjack strategy page.

The one thing that doesn’t change just because you start playing good games, and with the best strategy, is how your short term results will vary. You still might lose or win any particular playing session and you can lose just as much in one day as you can playing like the player in the first example.

Calculating Per Day Bankroll

This means you will need a similar bankroll for the trip, just like the one in the first example. You can probably get by on most trips with less, but if the main reason for your trip is to play blackjack you don’t want to run out of money if possible.

If you play the same 18 hours as the first trip, your expected loss is only $90. You should still take at least a bankroll of $500 for the trip, and $1,000 is better. Split your bankroll into three parts and follow the same method as suggested in the first example.

You still earn comps, so if you find a good enough player’s club you can come close to breaking even on most trips if you factor in the comp value.

Counting Cards at Blackjack

Lesson #3: Counting Cards

It was easy to get from example 1 to example 2. It’s so simple anyone can do it, so you don’t have any excuse. Learn how to play using the strategy that works for you, and find the best games. Start learning more on our strategy and rules variation pages.

If you want to move to the next level of blackjack play you can learn how to do something to eliminate the last half percent house edge. Most players stop with the advice in the last example, but this step isn’t too hard for most people if they’re willing to give it a try.

Give It a Try

You have to start experimenting with counting cards to get to the next level, but don’t skip this section because of a preconceived notion you have about counting. It’s much easier than most players know to get started.

If you simply want to play a break even game against the casino you only need to pay attention to two cards as they’re dealt. You need to track the Aces and the Fives. This is often called the ace-five count. A version of this count was introduced by Edward Thorp, but the Wizard of Odds has a good overview of the system.

How to Use Ace-Five Count

Basically, you start your count at zero and add one for every Five you see, and subtract one for every Ace you see. When the count is a positive two (+2) or higher you bet more. When the count is one (+1) or less, you bet the minimum amount.

By playing perfect strategy at blackjack games with good rules and using the ace-five counting system you can actually gain a small edge against the house. The exact amount of the edge depends on how large the spread is between your minimum bet and your maximum bet and how much you bet on average when the count is in your favor.

The Wizard claims you can gain an advantage of .3%, or three-tenths of one percent, if you have a bet spread of 1 to 8 and double your bets after each hand the count is positive two or higher up to your maximum bet.

At the Casino

So if your minimum bet is $10, if the count gets to positive two your next bet is $20. If the count stays at two or higher you then bet $40, and then $80. With a 1 to 8 spread, this is as high as you bet. If the count drops below positive two you drop your next bet to the minimum again. In this example, you drop back to $10.

One problem with large bet spreads is the casinos don’t want you to count cards. If you have large bet spreads and only bet higher amounts in positive counts you may be asked to stop playing eventually.  A 1 to 8 spread isn’t out of the ordinary for most players, even if they aren’t counting cards so you should be able to use it without much worry.

While it sounds great to possibly get an edge against the casino, most players make a few mistakes in counting and / or basic strategy so they don’t get the maximum advantage, but if you use the ace five count and don’t make too many mistakes you can break even in the long run against the casino playing blackjack.

Think about what this means for your blackjack play. Not only does it allow you to play as much blackjack as you want because you’re basically playing for free, but think about the possible comps.

If you’re breaking even and you have a large enough bankroll you can play for much higher stakes. What if your average bet was $100 instead of $20? You’ll earn five times as many comps. All of a sudden you can play enough volume to get all of your meals paid for and your hotel covered whenever you want to play.

Short Term versus Long Term

Just like in the first two examples, the short term may or may not play out like your long term expectation. Even if you play well enough to break even in the long run you can win or lose large amounts in the short term.

If you start betting $100 average per hand or higher you can win or lose thousands in a day. You aren’t guaranteed of winning or breaking even during any particular playing session or day.

If you reach this level of play you’ve moved into the top few percent of blackjack players. You should be proud because most players never come close to playing break even blackjack.

But there’s one more step available for players willing to go all out in their search for blackjack profits.

Blackjack player

Lesson #4: Professional Player

The final step is when you become a professional blackjack player. This may sound like a dream way to make a living, but the truth is it’s a tough life and very few people are able to do it. Professional players are able to learn advanced counting systems and other techniques that can give them a long-term advantage against the house of 1% or more.

We have an in-depth page about card counting so if you want to learn more make sure to read it. Here we’re going to focus on the expected profit for an advantage blackjack player.

Expected Win Rate

Of course, if you have an advantage you want to bet more on average, so let’s look at what happens if you make an average bet of $100.

.01 X $100 X 50 = $50

This means your expected win rate per hour is $50. If you can get your average bet up to $200 per hand you can win $100 per hour.

The good news is if you learned how to use the ace-five count all you have to do is expand the cards you track. But you also have to deal with other things that non-counters don’t like casino surveillance trying to keep you from playing and finding opportunities wherever they may be. You might be playing in Nevada one week, Atlantic City the next, and in Mississippi the next week. You have to go where the action is if you want to maximize your long-term income as a blackjack advantage player.

Calculating Per Day Bankroll

Since this example deals with advantage players, how do they determine how big their bankroll needs to be?

Many of them base it on something called the Kelly Criterion, which determines the correct size of a bet based on the odds of winning. While this can be useful, the advantage players use the Kelly method to determine the size of their bets, they use a much simpler method to determine how big their bankroll needs to be.

The top professionals want to have a bankroll large enough that they can safely place the maximum bet size possible in every situation where they have an advantage. This means they need enough to bet the maximum amount at the blackjack table when they have a positive situation.

If the maximum bet they can make while playing blackjack is $10,000 per hand they need to have enough to handle all of the possible ups and downs of short term variance.

While this page is about blackjack, what you’ll find when you start looking into professional gamblers is they don’t just play blackjack. They tend to look for advantages anywhere they can find them so if they can get an advantage on the golf course they’ll take it or if they can join a profitable poker game they’ll do it.

How Much Blackjack Bankroll is Enough?

Bankroll sizesWhile using the simple mathematical formulas above to learn your expected loss or win rate is helpful to some players, the size of your blackjack bankroll really depends on your goals.

If you’re a casual player and just want to play from time to time for fun, you don’t need a huge bankroll. You could find a $5 or $10 table, sit down with $100, and play until you lose it all or double up. You should still try to find the best games and use basic strategy, but you don’t really need to worry too much about your total bankroll.

Players who want to play more often need to be more aware of their bankroll. If you play once a month for three or more days per trip, you need a session bankroll and an overall bankroll. Most players in this category have a source of income to rebuild their blackjack bankroll, but if you can play a break even game it can deepen your enjoyment and let you play more.

If you average $20 per hand you should have a blackjack bankroll of $2,000 to be comfortable. You can probably get by on a $1,000 bankroll, but a long downswing can eat a good chunk of your bankroll in a short time. You can multiply your bankroll needs based on this example. Here are a few other average bet sizes with the comfortable and minimum blackjack bankroll requirements.

Average Bet Bankroll Minimum Bankroll
$5 $500 $250
$10 $1,000 $500
$25 $2,500 $1,250
$50 $5,000 $2,500
$100 $10,000 $5,000
$500 $50,000 $25,000

As you move up the ladder toward gaining a long-term edge over the casino you get closer to the point where you need a large enough bankroll to handle any situation. Some advantage players have bankrolls well in excess of a million dollars, and many have access to other people with money who are willing to invest in profitable opportunities.

The Money Management Side

Learning how to manage your money while playing blackjack has more to do with knowing when to stop playing and when you should or shouldn’t play than anything else.

We’ve already talked about good blackjack bankroll management when we talked about dividing your trip bankroll up into equal parts based on the number of days you plan to play. Each player handles wins when they divide their bankroll in different ways.

Some players total their blackjack bankroll and divide it again after each day of their trip.

Money Management Example

If you plan to play for five days and you have a total bankroll of $1,000 you have $200 a day starting with the first day. If you have $100 left after the first day your total bankroll is now $900. You divide this by the four remaining days so your new daily bankroll is $225.You break even on your second day so you still have $900. This means a total of $300 per day for the last three days. On the third day you lose $200, so your total bankroll is now $700, or $350 per day. On the fourth day, you lose $100 so your total bankroll is $600.At this point, you can play with the entire $600 on the last day, but you also might decide to put $400 in your pocket and only play with $200.

Deciding which betting limit to play is also part of money management. Many casinos offer different table rules at the low limits than they offer at the high limits. Do you have enough money to play at the $20 minimum tables if the $5 or $10 tables don’t have good rules?

Some low minimum bet tables have such bad rules that you can’t play. For example, if a table only pays 6 to 5 for a blackjack the house edge is too big and you shouldn’t play.

Conclusion

Once you learn how to determine your expected loss or win per hour you can easily determine how big your blackjack bankroll needs to be in any situation. One thing to remember is there’s never a situation where your bankroll can be too big.

Focus on playing, at least, a break even game so you don’t have to worry as much about your long term blackjack bankroll. You still need a cushion, but if you have a decent sized bankroll you won’t need to worry about going broke over time.

As easy as it is to reduce the house edge to a low amount and have a chance to break even, there’s really no excuse to keep giving the casino your money. Follow the simple steps included above and you’ll quickly be on your way to more comps, more fun, and more opportunities to play blackjack.