College is too late to start learning finance. That’s what a majority of Americans believe, according to this recent Qualtrics survey. And while that groundswell of support might help reform primary education over the next few years, it won’t help young women right now. But poker can. From handling debt to managing a budget, poker teaches professional and personal finance tips women can take into their lives. Skills like these.
1. How to manage debt
Too often, any debt is seen as bad debt. But managing debt is really just building a relationship with risk and understanding your odds of success.
Playing strong draw hands vs. weak draws
In poker, we use playing a “draw hand” as an example of how to manage risk and debt. Let’s say you’ve been dealt your first two cards (two diamonds), and now you’ve seen “the flop” (the three communal cards on the table, of which two are diamonds). You don’t have the best hand now, but you could have a flush (all the same suits) if the next card is a diamond.
You have a “strong draw,” and taking on the “debt” of this hand is worth the risk for the potential reward. It’s usually worth betting on a strong draw and folding on a weak one.
Tip: Bet on your strong draws
And that’s the same tip for your personal finances. Taking on student loans to attain a degree is still a strong draw, based on the return on investment of attending college. While the debt of a payday loan would be a weak draw due to their exceptionally high interest rates, especially if you can’t repay.
2. Making responsible investments
Markets like the Dow and S&P have seen unprecedented growth and volatility in the last year. And opportunities in stocks, cryptocurrencies, and NFTs are increasing. It’s easy to get swept up in how quickly things move. But a steady hand will help you more than betting on everything.
Put on your poker face
Your EQ is as important as your IQ in poker. Practicing patience and regulating your emotions will keep you from falling into traps set by other players. Your opponents are trying to read you as much as they’re trying to read their hand, and while you might not be a great storyteller out of the gate, you can try to be a statue.
Tip: Practice mindfulness (on and off the felt)
The same is true for investing. One of the most common ways investors hurt their portfolios is through overactivity triggered by their emotions.
3. Building (and keeping to) a budget
Tracking is the key to budgeting. If you don’t know what you’re spending, there’s no way to plan and understand your habits. Building that self-awareness is key to winning in poker.
Know your play, know yourself
It can be easy to be focused on how other people at the table play their hand, and lose sight of what leads to your successes at the table. Take the time to document (on paper or in a Notes app) how you are performing and when.
Tip: Track your behavior
You might find that you bet big early in a game and end up regretting it. Just like using a budgeting app might help you see that you spend too much just after payday.
Bonus: Join community poker lessons
We teach poker and life skills like these to women at Poker Power. And whether you’re a beginner or a poker pro, you can join our community lessons now.