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I recently read Gus Hansen’s blog in which he explained how he’s part card player, part businessman, and part degenerate gambler — about 60/30/10. The blog resonated with me for a few reasons, chiefl y, though, because I can relate. I even like how Gus breaks it down percentage-wise.
My fi rst big score came in the ‘06 WPT Championship but I put virtually the entire check towards building my bankroll. It wasn’t until my WSOP 2nd place fi nish that I found myself in a position of wealth.
As a sports fan, I’ve seen a lot of players make the jump from athlete to businessperson. With everything from endorsement deals, clothing lines, restaurants, charities, and even their own fragrances, I’ve watched people like Carmelo Anthony, John Elway, Michael Jordan, and others diversify their interests and secure sources of income for themselves and their family long past their playing years.
I’ve also seen some colossal blow-ups. Last August, former NBA baller Latrell Sprewell had his $1.5 million dollar yacht repossessed because he stopped making the payments on it. I won’t even begin to chart the fall of celebrities like Britney Spears, Marion Jones, and Rae Carruth. I’m not a big-time celebrity like they are, but we do share something in common: All of us went from having a little to having a lot almost overnight.
As they say — easy come, easy go. I’m doing just fi ne and, believe me, I’m not complaining; but I can’t even describe the number of “opportunities” that have come down the road, the vast majority of which have been laughably obvious scams. That’s not to mention the other potential pitfalls like drugs, legal trouble, and bad fi nancial management that lurk in the background for everyone.
Unlike athletes and celebrities, poker players have to risk their own money to make money. In cash games they can only win what they put out there. It’s a little different with tournaments, but tournaments require a lot more luck since one misstep and their run can be done. This high degree of risk makes diversifying really important, if they can swing it. I know that my primary job, the thing I’m best at, is playing poker. But I have other interests that help balance out the emotional and fi nancial swings inherent in the game.
I’ve locked most of my money up, where even I can’t get to it. But I’ve also put energy and, in some cases money, into an endorsement deal, a poker school, a book project, real estate, the stock market, and yes, a little sports betting.
As I’ve branched out, I’ve spent a lot of time thinking about how to make sure I’m part of that fi rst group, the group that invested wisely, not the group that fell from grace in extraordinary fashion.
The hard part is knowing when to keep a hands-on approach and when to let professionals handle some of it. In general, I believe you should know as much as possible about whatever you’re getting into. The more you know about taxes, the better the conversation you can have in April.
I also believe the absolute most important thing you can do is surround yourself with good people, people you absolutely trust. Maybe if Britney and Paris had actually had real friends, they wouldn’t have gotten in as much trouble. In addition to trusted family members and friends, it’s crucial to have a good lawyer, accountant, and fi nancial advisor. Scrimp on these and your decision might bite you hard. Just ask Martha Stewart.
The other thing that’s held me in good stead is instinct. I’ve made some mistakes, but generally when something feels like a bad idea, even if you can’t pinpoint exactly what the concern is, you should probably walk away. I’ve had guys come to me with deals that have to be done immediately or the “opportunity” will disappear. I decided a long time ago never to allow myself to be pressured into making a fi nancial move, and that has saved me money more times than I care to count.
As for the degenerate gambler part, I’ll never get the feeling of wanting that rush completely out of my system. The key is to keep it under control. But as my life changes, I don’t ever want to lose that 10%. After all, it’s what got me here in the fi rst place.
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