During my junior year of college, a friend taught me the rules of Texas Hold’em poker and I caught the bug – hard.

When I told my mom about my new hobby, she freaked out. She didn’t want her son to become a “gambler” and wanted me to stop playing this game immediately.

After spending some time in casinos with true gamblers, I understood her sentiment. Gamblers are losers. Nobody wants their kid to be a loser.

I’m teaching my preschooler to play poker anyway!

Sorry Mom 😉

I’m going to take a different parenting approach toward this game with my children. Why? Because poker players, good ones at least, are not gamblers, they’re investors. The great ones are analytical long-term strategists with strong self control.

That’s a list of skills I’d be proud for my children to have. I can’t think of a better game to teach my kids about life and money.

How We Started (Child Age 3)

I wish I can take credit for how this family game started, but I can’t. One day, my son noticed the poker chips in the game closet and asked about them. So, I pulled them out and showed him. He was fascinated by the colors and enjoyed grabbing a few of each color and making chip towers with different color patterns.

When he kept asking to play, I made up a game using only the numbered cards. We took turns picking a card. If it was black, we took that many chips from the middle. If it was red, we put them in. I took some red cards out of the deck before we started. Eventually, all the chips from the middle would end up in our piles. Whoever had the most chips at the end won.

While this game was total luck, it greatly improved his number recognition. When he did not recognize the number on the card, I instructed him to count the shapes to figure it out. He also had to count out the number of chips to give or take each turn.

It’s Amazing How Quickly Kids Learn (Child Age 4)

We’ve since graduated from that simple game and are now playing a “higher/lower” game. We are dealt one card face down and then each of us guess if we think our card is higher or lower than the other player’s card (which is hidden). If we are both right or both wrong, no chips are exchanged. If one was right and the other was wrong, the winner collects the pot.

I was in awe of how he was making almost optimal decisions in this harder game right away. Sometimes, our kids have a grasp of things we just don’t realize. Still, even with optimal decisions, sometimes he was right and sometimes wrong. Those are the breaks when you can’t see the other person’s card. If that’s not a life lesson, I don’t know what is.

He does need to work on his poker face, though. When I’d guess I had the high card and he looked down at a 10 (there were no picture cards), he’d automatically start giggling because he’d know he won. Nothing’s better than hearing that laugh. Playing “poker chips,” led to many more of them than the typical preschool board games.

During the times we’ve played this made-up game, my son has improved his counting, adding and subtracting. He’s learning how to shake off losing and more importantly, how to behave when he wins. In our house, we expect lots of winning to happen so it’s nice to teach it early.

I think the next step in our game is to introduce different chip values. For example, a red chip may be worth 5 instead of having them all be worth one. Ideally, this will teach him to count by 5s and other multiples. We will start mixing in some multiplication to our games instead of just addition and subtraction.

Why Poker Is A Great Life (and Personal Finance) Skill

Playing with my son at 3 and 4 years old, we have not evolved into “real” poker yet. But we will, as soon as he’s ready. I think that learning to think like a poker player is a wonderful way to succeed at life. Here are some of the skills needed to succeed:

Understanding of Probability

In order to begin to understand proper strategy, you need to learn the odds. Some hands are more likely to win than others and are worth playing; others are garbage that need to be thrown away. A winning poker player evaluates the cost of each bet and it’s expected return.

Advance Planning

Winners plan multiple moves in advance. Before taking their next action, they’ve determined how they will respond to each of their opponents potential actions and what they will do based on the next community cards to fall.

Analytical Thinking

A good player needs to think deeply on many levels to be successful. When watching poker on TV, you will occasionally hear a player say, you either have hand A or hand B to his opponent. Once in a while, they are able to pinpoint the exact hand their opponent has!

They are always trying to figure out what their opponent’s holding based on their actions. This is of the utmost importance. For example, having the second best possible hand is usually a great situation, but if you know for sure your opponent has the best hand, you can avoid going broke.

Variance and Avoiding Results Oriented Thinking

You can do everything right, get all your money in with the best hand and still lose. Ouch. This disappointing result is called variance.

In poker, you can only control your actions, not the results. A good player knows this and focuses on making optimal decisions.

They make the best possible choice and don’t stress over the variance. After a hand is done – win or lose – it’s back to making good decisions, not worrying about if they’re lucky or not.

Patience

We all want to get rich quickly. Most of the time, attempts to do so will not work. The most reliable path to wealth is to make profitable decisions and be patient while they produce results.

Impatient players often put money into the pot “just to see what comes next.” Folding is boring, right? Wrong. Folding negative expected value (aka bad) hands is a winning strategy. A dollar or chip not spent on a bad bet is one that has power to make you money later when a profitable spots presents itself.

Bankroll Management

We all know the saying, “don’t put all your eggs in one basket.” It’s important in poker and investing. A winning poker player knows to play at a level that’s both profitable and sustainable.

If you risk your life savings every time you play cards, you will eventually go broke. Play too low and your profits may not pay an adequate return for your efforts. Finding the right balance is key.

The Difference Between Investing and Gambling

Here’s how I define each:

Gambling is putting something of value at risk and hoping for a positive outcome without regard to the expected return.

Investing is putting something of value at risk in exchange for a positive expected return.

These definitions use many of the same words. But in practice, couldn’t be more different.

Gamblers may sit down at a poker table, but they are not investing.

When played right, poker is all about investing. Every decision should be made to maximize expected value (EV).

I’m teaching my preschooler to play poker because I want him to learn about arithmetic, probability, advanced planning, analytical thinking, variance, patience and bankroll management.

I want him to be a good investor – not a gambler. I think it’s of the utmost importance to learn the difference.

What About You?

Are there any poker players in the audience?

Are you teaching your kids how to play?

At what age do you think it’s right to start?

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