JJG’s Outline of Bitcoin Investment Ideas

[Cossyblack]

I think that investing 100% of a person's discretionary income for investment can be a bad idea. Because if a person invests monthly or weekly, if after investing he needs some amount of money, then where will he get that amount of money from? Then if he has an emergency fund, then he will have to take it from the emergency fund, otherwise he will have to take a loan from someone. But taking money from the emergency fund for such small financial crises is not the right decision at all.

Buddy I think your re missing the point,if you read through my post you see will where I do mention of reserve funds. Like I have said, someone that's investing 100% of his Discretional income in Bitcoin is assumed he already building his Emergency funds & Reserve along with his Bitcoin investment. If after investing 100% of his Discretional income,along the line he needed money to buy some  essentials items, he can decide to wait for his next earning to drop but if he cannot wait,he may as well make use of his Reserve funds to buy those essential stuff rather than taking loans.

If a person invests in this way he is not taking too much risk and is cleverly continuing to invest 70% of his discretionary income.

I think if you re buying Bitcoin with your discretional income whether using 70% of it, less or more but so far it is your Discretional income that is been used for the purchases,the risk involved is reduced. If anything happens in the future,you wouldn't find it difficult to move on because it was your discretional income that was invested.

[abaeze]

The discretionary income should never be used all for investment as there is an important part of discretionary income needs to be assigned to an emergency fund. I perhaps a little bit inaccurate by saying never, as the emergency fund needs to be build up from $0 and the fund will increase with time so in the future, you will reach to your wanted emergency fund and after that you are able to use 100% of your discretionary income for DCA bitcoin.

Until you reach to that point with a safe emergency fund for urgent needs, it's unwisely to use all 100% discretionary income for investment.

Not at all. Sometimes overthinking becomes the biggest obstacle to investing. If someone believes that the price of Bitcoin will increase many times in the future, even if he is a new investor, staying in waiting mode for the long-term means missing an opportunity, that is, missing the opportunity for the price to increase. Especially in the case of a scarce asset like Bitcoin, time in the market is much more important than "timing the market".

So if there is a discretionary income, then someone can invest in Bitcoin if they want. It is important to have an emergency fund, but postponing investment on the pretext of that is a kind of missed opportunity.

[CageMabok]

...

The discretionary income should never be used all for investment as there is an important part of discretionary income needs to be assigned to an emergency fund. I perhaps a little bit inaccurate by saying never, as the emergency fund needs to be build up from $0 and the fund will increase with time so in the future, you will reach to your wanted emergency fund and after that you are able to use 100% of your discretionary income for DCA bitcoin.

Until you reach to that point with a safe emergency fund for urgent needs, it's unwisely to use all 100% discretionary income for investment.

To whom are you giving this advice?
Investing doesn't have to be 100% of your funds, even if the investment is aimed at Bitcoin. If an emergency fund built over months or years allows everyone to use all of their discretionary income, it will also set them up for difficulties in the future. At the very least, it will be difficult for such individuals to be more consistent in investing, even if they have an emergency fund prepared. However, the funds that must be available and spent daily also need to be considered because they are also part of our own needs.

So, it's not necessary to invest 100% of your funds immediately, as long as we still purchase all our living expenses ourselves. This means that each person can use half of their income for investments, while the other half should be allocated to their needs and also to build a stronger emergency fund. When entering this kind of situation, financial management knowledge will certainly be essential for anyone. Building an emergency fund from $0 isn't a barrier to not investing. Instead, everyone can invest directly while slowly growing their emergency fund, so that time isn't completely wasted on building one thing.

[BitBakerr1]

Let's say that the monthly income is around $2k and half of that income (so $1k) is used for various basic expenses such as housing, utilities, basic food and basic transportation.  That leaves $1k as discretionary income.

Now if the guy is investing 5% to 25% of his income into bitcoin, then that would be between $100 to $500 per month, which, in this example would be 10% to 50% of his discretionary income.

The discretionary income should never be used all for investment as there is an important part of discretionary income needs to be assigned to an emergency fund. I perhaps a little bit inaccurate by saying never, as the emergency fund needs to be build up from $0 and the fund will increase with time so in the future, you will reach to your wanted emergency fund and after that you are able to use 100% of your discretionary income for DCA bitcoin.

Until you reach to that point with a safe emergency fund for urgent needs, it's unwisely to use all 100% discretionary income for investment.

I totally agree with you on this, if you don't have an emergency funds using all your Discretionary income to invest into Bitcoin is like digging a bit and then falling inside it without a ladder to help you clamp out, you must understand that in life we will always have challenges and emergencys and we must always prepare for this emergency when you don't prepare for it it will cost you your investment and that is why you see some set of people lose their investment because of an emergency issue if they had a very strong emergency funds they won't lose their investment because that emergency funds will always help them out and preserve their investment.
So instead of you to use all your discretionary income to invest in Bitcoin knowing fully well you don't have an emergency funds, it will be better to use some of the discretionary income to build your emergency funds while building your Bitcoin investment.

[JayJuanGee]

Let's say that the monthly income is around $2k and half of that income (so $1k) is used for various basic expenses such as housing, utilities, basic food and basic transportation.  That leaves $1k as discretionary income.

Now if the guy is investing 5% to 25% of his income into bitcoin, then that would be between $100 to $500 per month, which, in this example would be 10% to 50% of his discretionary income.

The discretionary income should never be used all for investment as there is an important part of discretionary income needs to be assigned to an emergency fund.

Perhaps with some of my discussion of these matters, I am assuming that the emergency fund (and/or various back up funds) are already in place.  Once the back up funds are large enough, they do not need to continue to be added to, unless they are getting tapped into and/or unless there have been increases in the regular expenses that would justify also increasing the back up funds.

Otherwise, I agree with your point that we should not be forgetting about making sure that back up funds are sufficient enough to handle most normal shortage of income situations that might come about so that the investment (bitcoin in this case) is not tapped into at at time that is not of our choosing.

Of course, another question may well pertain to how fast and how much to build up emergency funds, and surely one of my other assumptions is that an overwhelming majority of regular people are not operating on zero back up funds when they first come to bitcoin, so generally, they will likely already have a practice in which they are keeping around 2-6 weeks of backup funds, and the extent of their back up funds will likely relate a bit to their personality or perhaps how organized they already are in their cashflow management systems and/or practices, and yeah sure of course, some folks will also fit outside of that range.

So then when coming to bitcoin, there likely is a desire to build up bitcoin and if they have absolutely zero bitcoin, and they have 4 weeks of back up funds, I see no problem investing whatever level of discretionary income that they are planning to allocate to focus on getting their bitcoin investment to be equal to their back up funds (so to get it to 4 weeks), and then to potentially build them both up at the same rate thereafter until they both (each of them) get up to 3 months of expenses, and even alternatively to  focus on building the bitcoin side faster than the emergency funds side.. such as 75% bitcoin / 25%  back up funds.. and yeah of course, these are both discretionary matters regarding how to prioritize and they are also somewhat individualistic dependent, so if a person has unsteady income and/or expenses, then he may well need to focus way more on  building the back up funds side in a more robust way as compared to a guy who may have greater financial security in terms of his income and/or his expense levels. 

Again, guys need to figure out these matters, and if they screw up their ways of allocating and/or preparing themselves, then they are the one who is going to need to pay the price of their screw ups, and I like to consider that a lot of people prefer to not lose money, yet surely some guys are more willing to take risks than others, so they likely would be tailoring their approach with their personality, which may or may not work out for them if they are not able to find an appropriate balance that does not cause themselves to be overexposed to unnecessary risks.

I perhaps a little bit inaccurate by saying never, as the emergency fund needs to be build up from $0 and the fund will increase with time so in the future,

Sure, there may well be cases in which bitcoin newbies are coming to bitcoin with absolutely no habit of having any back up funds and/or that they are extensively in debt and have other kinds of screwed up finances, yet I doubt that we should be anticipating that everyone is so screwed up in their cashflow management practices and/or systems, even though surely I don't have any problems employing an assumption that a lot of people are struggling financially in variety of ways, whether they are rich or poor (and sure of course, by definition, poor people will tend to struggle more in their various financial balancing than rich people, generally speaking).

you will reach to your wanted emergency fund and after that you are able to use 100% of your discretionary income for DCA bitcoin.

Until you reach to that point with a safe emergency fund for urgent needs, it's unwisely to use all 100% discretionary income for investment.

I agree with these points, which in essence many of us woudl be able to be way more aggressive in out bitcoin investing once we have various back up funds in place.. generally speaking we should be striving to get our emergency funds to a point that we never have to touch them, and any portion of our back up funds that we are touching would be the portions that go beyond our emergency funds.. so many times, we likely will see that guys might contribute to their own emergencies by employing poor cashflow management and dipping into their emergency funds for non-emergencies,

....so emergency funds are likely funds that we would not let ourselves tap into so any funds that we are tapping into are more flexible back up funds, frequently referred to as reserve funds... and reserve funds can be for any reason, such as saving up for various future expenses, or buying the dip or even funds that would be used prior to touching emergency funds... so then emergency funds are used when there are no other funds remaining... some kinds of funds are more liquid than others, and surely some funds might take a week or two to be liquid and other funds might take several weeks to be liquid, and at the same time, back up funds should not be very volatile since we would not want to tap into funds that are down in value at the time that we need to tap into them.

By the way, I understand that it can be confusing to switch various terms, since some guys will label all back up funds as emergency funds, so sometimes I will refer generically to both emergency funds and reserve funds as back up funds, even though surely I consider emergency funds as the kinds of funds that we don't tap into, yet as you seem to suggest (and even other members also seem to realize) it can take a while to buiild up the back up funds, so practically when various back up funds are still being built so that the emergency funds can get up to the size of 3 months of expenses, they may well be tapped into from time to time, so they are not really serving as emergency funds but instead like reserve funds or just generically back up funds that are aspiring to get up to a large enough size so that 3 months of expenses can just sit on the side and hopefully never need to be tapped into absent an actual emergency rather than mere fluctuations in income versus expenses that happen from time to time.. 

Of course if we are in the process of being more aggressive with our investment into bitcoin and from time to time we might make mistakes in terms of overestimating our discretionary income for the month (or week) and/or maybe some fairly minor expenses come up, but then we do not have any discretionary income remaining because we had spent it all on buying bitcoin, so of course we are ONLY in comfortable position with our mistake when our various back up funds are enough to cover such mistakes.. so there can be a difference of impact between BIG mistakes and small mistakes, and so surely each of us has to figure out the extent to which he can push limits without overdoing it, and so if we do not have sufficient back ups for various mistakes that we might make, then we likely have to be more conservative and/or cautious in regards to our level of aggressiveness in our using large amounts of our discretionary funds for buying bitcoin.

If anyone is using 90% of his discretionary income he's been aggressive in his bitcoin accumulation however if such a person has a very strong backup funds such as emergency, reserve and float funds then using 90% of his discretionary income is okay because he still has 10% left and if in case of emergency or something important comes up he can just dip hands into any of his backup funds depending on the issue and then settle or solve it.
But if you are without a backup fund then you shouldn't even think about using 90% of your discretionary income to invest in Bitcoin Because you will end up dipping hands into your investment, so what you should do is to invest some percentage of your discretionary income to Bitcoin and then the rest to growing your backup funds, you may put more percentage to building your backup funds and when you have built it to a good extend then you focus on your Bitcoin investment and you can even decide to be a little aggressive at that point because you already have a good backup funds.

To understand the meaning of discretionary income, I think it's important that we no longer talk about reserve funds and all other forms of funds for various needs. Discretionary income is the remainder of mandatory expenses, and everyone is free to use that money for activities they believe will generate profit or not. But since we're talking about investing in Bitcoin, most people set the percentage of investment allocation based on their own capabilities. Referring to discretionary income as a whole, any investment percentage is fine, as it's more of an individual decision. I believe discretionary income has also accumulated a fixed amount that won't be used elsewhere.

Most of us probably don't fully understand discretionary income, as it's not necessarily about reserve funds and all the other forms of funding necessary for life. The question is whether or not it's appropriate to use 90% of these funds for Bitcoin investment. I believe this decision is entirely up to each individual, as there's little specific reference to this allocation.

It seems to me that "we" are referring to these various categories of funds in order to attempt to communicate how a guy might attempt to measure the extent to which he might end up overdoing it in his investment or if he might be acting in ways that are too aggressive, so whether a guy invests 10%, 50%, 90% or some other chosen quantity from his discretionary income, he is choosing his level of aggressiveness (and like you say that is totally within his choice to choose his level of aggressiveness), so frequently guys might get so excited about investing into bitcoin, so then they might strive to be as aggressive as they can without overdoing it, yet they have to figure out some ways of measuring how aggressive that they can be, which also likely gets us back to understanding that if the guy has inadequate back up funds, then he is more likely to be screwed if he over does his investment into bitcoin, and then he has to cash out some or all of his bitcoin at a time of his own choosing because he had failed to adequately account for his own limitation, and maybe in some sense it might not matter how we label the various categories, except that some of us might not understand what other guys are saying in the event that we do not clarify some of the ways of labelling the different kinds of funds.

[siniminomorocomunisakito]

So, it's not necessary to invest 100% of your funds immediately, as long as we still purchase all our living expenses ourselves. This means that each person can use half of their income for investments, while the other half should be allocated to their needs and also to build a stronger emergency fund. When entering this kind of situation, financial management knowledge will certainly be essential for anyone. Building an emergency fund from $0 isn't a barrier to not investing. Instead, everyone can invest directly while slowly growing their emergency fund, so that time isn't completely wasted on building one thing.

I will keep it short and not want to be long-winded in my response, that what you said above is like someone's plan to buy a new car with a total capital of $ 25,000, a Toyota Kijang Innova Venturer Diesel, without thinking about tax, service and daily operational costs.

The last sentence is also a good message to be able to adjust to financial conditions and needs, meaning according to appropriateness.

[Cossyblack]

Perhaps with some of my discussion of these matters, I am assuming that the emergency fund (and/or various back up funds) are already in place.  Once the back up funds are large enough, they do not need to continue to be added to, unless they are getting tapped into and/or unless there have been increases in the regular expenses that would justify also increasing the back up funds.

Otherwise, I agree with your point that we should not be forgetting about making sure that back up funds are sufficient enough to handle most normal shortage of income situations that might come about so that the investment (bitcoin in this case) is not tapped into at at time that is not of our choosing.

I agree with you, if an investor is building an Emergency fund & Reserve funds alongside his Bitcoin investment,he should build it to a level that it becomes strong enough to handle Emergency situations. I think if an investor is building his Emergency fund & Reserve funds then, he should be doing so for three months but in some cases where the investor already have an emergency fund before venturing into Bitcoin investment, atleast 2-4 weeks is enough to build a sufficient backup.In this way,he wouldn't tamper with his bitcoin investment if he finds himself in an emergency situations because his Emergency & reserve got him covered.

[JayJuanGee]

Perhaps with some of my discussion of these matters, I am assuming that the emergency fund (and/or various back up funds) are already in place.  Once the back up funds are large enough, they do not need to continue to be added to, unless they are getting tapped into and/or unless there have been increases in the regular expenses that would justify also increasing the back up funds.

Otherwise, I agree with your point that we should not be forgetting about making sure that back up funds are sufficient enough to handle most normal shortage of income situations that might come about so that the investment (bitcoin in this case) is not tapped into at at time that is not of our choosing.

I agree with you, if an investor is building an Emergency fund & Reserve funds alongside his Bitcoin investment,he should build it to a level that it becomes strong enough to handle Emergency situations. I think if an investor is building his Emergency fund & Reserve funds then, he should be doing so for three months but in some cases where the investor already have an emergency fund before venturing into Bitcoin investment, atleast 2-4 weeks is enough to build a sufficient backup.In this way,he wouldn't tamper with his bitcoin investment if he finds himself in an emergency situations because his Emergency & reserve got him covered.

You seem to be saying a couple of things different from the way I am saying them, and coming to interpretations that do not seem correct.

Sure, in the end, guys can do whatever they like, even dumb shit that makes no sense, and if they end up taking too much risk on one end or the other, then they will have to suffer the consequences of the risk that they unwittingly had been embarking upon.

First off, I am not proclaiming that anyone should be content to have back up funds that would ONLY support them 2-4 weeks, especially as they build their bitcoin stack to a larger and larger size and they slowly evolve into having a bitcoin stash that they want to protect, then their bullshit little 2-4 weeks worth of expenses is likely to be too insubstantial to protect their presumptively growingly large bitcoin stash - whether the bitcoin stash is in profits or not at the time that they might run into some potential difficulties.

It seems that I was proclaiming an assumption that an overwhelming majority of normal people are likely to already come to bitcoin with more than zero in their back up funds.  Sure, it likely is the case that a decent number of folks come into bitcoin and they have even less than 2 weeks worth of back up funds or even that they are close to zero or even below zero, and sure, the worse their back up fund situation, the more urgent it would be that they do something about it - either as they are still getting started with bitcoin or at the same time that they are getting started with bitcoin.  They have to figure it out, yet if their situation is so bad that they might not even have discretionary income because their back up funds are completely depleted, then they may well not even be in a strong enough financial and/or psychological position to get started investing in bitcoin.  Yes, for sure, I emphasize getting the fuck started investing in bitcoin, even if financials and psychology might not be very great, yet to me it makes no sense for guys to come to the conclusion that they are able to get started if their finances are adding up to a reasonable  assessment that they really do not have a discretionary income. 

I presume that guys are able to have some common sense and some basic math, otherwise if they cannot figure out the extent to which they have discretionary income or not, then they are likely going to end up losing and they need help to learn basic math and to figure out how to develop their common sense.. (Isn't there a joke about common sense not being so common anymore?).  I am not going to assume folks do not have common sense and basic math skills, and so if they are lacking in such common sense and/or basic math skills they have to figure out how to fix those parts before investing into bitcoin.. since those lackings are going to contribute them to coming to various wrong conclusions about their money situation and/or their abilities to sufficiently learn how to be a bitcoiner, and I am not even proclaiming the requirements are high, since it is likely only around 1-2% of the world's population that is mentally retarded and everyone else should be capable of learning.. even if they are starting out from a bad starting place.

So my point is that even if a guy has only 2-4 weeks worth of back up funds, he can likely start to build the bitcoin portion based on what he already has and we should not presume most folks are starting with zero, since that is likley mostly not true, even if there are cases in which it is true.. and if a person is starting with 2-4 weeks of back up funds, maybe they get their bitcoin holdings to an equal size or maybe even 20-40% higher than their back up funds before they start to simultaneously build the back up funds as they are building their bitcoin investment, and sure as a default we can consider building them absolutely 50/50, yet we do not have to do it that way.. yet we are still likely taking chances if we are not adequately accounting for our situation and if we are overly emphasizing our bitcoin and not simultaneously building our back up funds, especially when the BTC investment size starts to get larger than our back up funds.

Of course, I had frequently mentioned that our goal would be to get our emergency funds to be at least 3 months of our expenses and also to have more back up funds (such as reserve funds) that go beyond the size of 3 months of our expenses.. and for sure, how large we build up these various back up funds likely depends on the various things that we have going on in our lives.. and some guys come to erroneous confusion that more is better in terms of their back up funds..which it may well not be the case that more is better, since we are striving to build our bitcoin investment, and even though more might be better (for our emergency funds) once we reach over accumulation status, more is probably not better while we are in the process of building up our bitcoin investment, which can take 4-10 years or longer just to get up to a decently large size, and surely some guys might even take 20 years or more to get their bitcoin investment up to a decent size, especially if they might be investing less than 5% or even less than 10% of their income into bitcoin.

Regarding your mentioning taking 3-4 months to build up your emergency funds, that comes off as total nonsense and out of touch with real circumstances.  Sure some guys might be able to build up their emergency funds in a fairly short period of time, yet what the fuck would such a guy be doing with his bitcoin investment during that time?  Are you living in a fantasy to just presume both can be built up simultaneously and get up to 3-4 months of their expenses within 3-4 months time?  The math does not work.  Think about it.  Maybe an example would help?

Let's say that a guy is brand new to investing into bitcoin (since that is what we seem to be talking about, a brand new investor, right?). 

Let's say that he is in his late 20s or his early 30s and he has a reasonably steady set of circumstances like having a job and having some track record of his expenses that he is able to measure

Let's say that his income has been ranging between $26k per year and $33k per year depending on how things go (so his monthly pay ranges between $2k and $3k with a usual amount that is around $2,500, and he barely has any investments or savings.. Let's say that his basic expenses range between $900 and $1,250 per month with an average of around $1,000, and let's say that he has nearly $1k saved up for his current back up funds, and let's say for the sake of this discussion, he has not been very good at investing so he has no other investments. 

Accordingly, financially he is not bad off since his income is nearly double his expenses, yet I would still say that his target emergency funds should be right around the worse case of his expenses, which would be $3,750 and he ONLY has $1k.  Yet he can still start investing in bitcoin and perhaps bring his bitcoin up to $1k in a month or two depending on how much he is going to put into bitcoin. He could start with $100 per week and it may well take him 10 weeks to get his bitcoin investment to equal the size orf his back up funds.  Of course, he has enough money that he can build both his back up funds and his bitcoin investment at the same time, yet these are all new activities for the guy and the reason that he hardly has any investment or savings is because historically, he had been spending most everything that he made, which was the reason that he ONLY had $1k in his savings, which maybe would be 3-ish weeks of his expenses.

You can presume away the guy is going to be able to build up his emergency funds and his bitcoin investment within 3-4 months, yet that does not seem very realistic, even if it might be theoretically possible.

Part of my point is that we should try to be realistic in terms of what guys might be able to do, even if their finances are good and even if they are somewhat gungho about bitcoin, which is also a pretty BIG assumption... and yeah, we might be able to attempt to tailor a relatively gungho approach to bitcoin for ourselves, yet we still need to be working from where we are at and making sure that we don't go overboard in how we might be attempting to both build our bitcoin stash and to make sure that we are either simultaneously building our various back up funds even if we might purposefully choose not to add to our back up funds until our bitcoin size might get to a size that is similar to our already existing back up funds, to the extent that we might already have some thing in place.

[Derekfunds]

Perhaps with some of my discussion of these matters, I am assuming that the emergency fund (and/or various back up funds) are already in place.  Once the back up funds are large enough, they do not need to continue to be added to, unless they are getting tapped into and/or unless there have been increases in the regular expenses that would justify also increasing the back up funds.

Otherwise, I agree with your point that we should not be forgetting about making sure that back up funds are sufficient enough to handle most normal shortage of income situations that might come about so that the investment (bitcoin in this case) is not tapped into at at time that is not of our choosing.

I agree with you, if an investor is building an Emergency fund & Reserve funds alongside his Bitcoin investment,he should build it to a level that it becomes strong enough to handle Emergency situations. I think if an investor is building his Emergency fund & Reserve funds then, he should be doing so for three months but in some cases where the investor already have an emergency fund before venturing into Bitcoin investment, atleast 2-4 weeks is enough to build a sufficient backup.In this way,he wouldn't tamper with his bitcoin investment if he finds himself in an emergency situations because his Emergency & reserve got him covered.

You are absolutely correct our reserve and emergency funds should be big in case of any unforseen circumstances, we can immediately use our emergency funds to settle the problem but these funds should not be prioritize over our discretionary income because our discretionary income is the major thing in our investment without it, we can not invest in Bitcoin and lastly, i don't think there is stipulated weeks  or months we should grow our reserve and emergency funds to but rather, we should just make sure to grow it and sometimes our source of income is what determines how long it will take us to...

[Finebone]

You are absolutely correct our reserve and emergency funds should be big in case of any unforseen circumstances, we can immediately use our emergency funds to settle the problem but these funds should not be prioritize over our discretionary income because our discretionary income is the major thing in our investment without it, we can not invest in Bitcoin and .

Discretionary income, emergency funds and  reserve funds all have their important role to play while investing in bitcoin, making it looks like they are competing with each other doesn't seems nice, since they all need to be in place for a successful Bitcoin investment.

lastly, i don't think there is stipulated weeks  or months we should grow our reserve and emergency funds to but rather, we should just make sure to grow it

Once your emergency and reserve funds is big enough to sustain you and your investment for a period of three months interval, then I think that you are good to go, it will be unnecessary to be still piling it up, just use that energy to stack up more stash of bitcoin.

[Qhunman]

You can presume away the guy is going to be able to build up his emergency funds and his bitcoin investment within 3-4 months, yet that does not seem very realistic, even if it might be theoretically possible.

Part of my point is that we should try to be realistic in terms of what guys might be able to do, even if their finances are good and even if they are somewhat gungho about bitcoin, which is also a pretty BIG assumption... and yeah, we might be able to attempt to tailor a relatively gungho approach to bitcoin for ourselves, yet we still need to be working from where we are at and making sure that we don't go overboard in how we might be attempting to both build our bitcoin stash and to make sure that we are either simultaneously building our various back up funds even if we might purposefully choose not to add to our back up funds until our bitcoin size might get to a size that is similar to our already existing back up funds, to the extent that we might already have some thing in place.

A guy plans on Building his Bitcoin investment within 3-4 months is slightly possible depending on his cashflows and the strategy he uses. If he is rich,he is already assumed to have a strong Cashflows. Looking at it theoretically seems possible using the DCA Strategy to buy. Let me set an Examples, A rich guy sets a target to accumulate Bitcoin worth of $5k within 3-4 months interval. If he is earning a total of $2500 per month and his basic needs per month ranges from $800-$1000, let say what is left as his extra cash is $1500. The rich guy can deduct & use $1250k of his Discretional income to buy Bitcoin regardless of the price while the remaining $250 can be used to build his Emergency fund & Reserve fund for the next 3-4 months.

[SuperBitMan]

Perhaps with some of my discussion of these matters, I am assuming that the emergency fund (and/or various back up funds) are already in place.  Once the back up funds are large enough, they do not need to continue to be added to, unless they are getting tapped into and/or unless there have been increases in the regular expenses that would justify also increasing the back up funds.

Otherwise, I agree with your point that we should not be forgetting about making sure that back up funds are sufficient enough to handle most normal shortage of income situations that might come about so that the investment (bitcoin in this case) is not tapped into at at time that is not of our choosing.

I agree with you, if an investor is building an Emergency fund & Reserve funds alongside his Bitcoin investment,he should build it to a level that it becomes strong enough to handle Emergency situations. I think if an investor is building his Emergency fund & Reserve funds then, he should be doing so for three months but in some cases where the investor already have an emergency fund before venturing into Bitcoin investment, atleast 2-4 weeks is enough to build a sufficient backup.In this way,he wouldn't tamper with his bitcoin investment if he finds himself in an emergency situations because his Emergency & reserve got him covered.

You are absolutely correct our reserve and emergency funds should be big in case of any unforseen circumstances, we can immediately use our emergency funds to settle the problem but these funds should not be prioritize over our discretionary income because our discretionary income is the major thing in our investment without it, we can not invest in Bitcoin and lastly, i don't think there is stipulated weeks  or months we should grow our reserve and emergency funds to but rather, we should just make sure to grow it and sometimes our source of income is what determines how long it will take us to...

Our emergency funds is as important as our discretionary income when it concerns bitcoin investment, you cannot do without the order these two things are very important in order to succeed in Bitcoin investment if you don't have any of these you will end up dipping hands into your bitcoin investment, some people don't use their discretional income they use money they are supposed to use to pay their bills to invest in Bitcoin and they end up dipping hands into their Bitcoin, some people also don't have an emergency funds and when emergency hits them they end up dipping hands into the Bitcoin.
So you really needs this two to be successful in Bitcoin investment.
And yes you need to have a very strong emergency funds, in terms of building this emergency funds like I always say you can build it alongside with your bitcoin investment all you need to do is to divide the percentage of your discretionary income and I will advise when building this two put more attention in your emergency funds since you will build it for some months or years after building it you can then focus on your Bitcoin investment.

[JayJuanGee]

Perhaps with some of my discussion of these matters, I am assuming that the emergency fund (and/or various back up funds) are already in place.  Once the back up funds are large enough, they do not need to continue to be added to, unless they are getting tapped into and/or unless there have been increases in the regular expenses that would justify also increasing the back up funds.

Otherwise, I agree with your point that we should not be forgetting about making sure that back up funds are sufficient enough to handle most normal shortage of income situations that might come about so that the investment (bitcoin in this case) is not tapped into at at time that is not of our choosing.

I agree with you, if an investor is building an Emergency fund & Reserve funds alongside his Bitcoin investment,he should build it to a level that it becomes strong enough to handle Emergency situations. I think if an investor is building his Emergency fund & Reserve funds then, he should be doing so for three months but in some cases where the investor already have an emergency fund before venturing into Bitcoin investment, atleast 2-4 weeks is enough to build a sufficient backup.In this way,he wouldn't tamper with his bitcoin investment if he finds himself in an emergency situations because his Emergency & reserve got him covered.

You are absolutely correct our reserve and emergency funds should be big in case of any unforseen circumstances, we can immediately use our emergency funds to settle the problem but these funds should not be prioritize over our discretionary income because our discretionary income is the major thing in our investment without it, we can not invest in Bitcoin and lastly, i don't think there is stipulated weeks  or months we should grow our reserve and emergency funds to but rather, we should just make sure to grow it and sometimes our source of income is what determines how long it will take us to...

You are making your points strangely and confusingly Derekfunds.

When we are new to investing, we are likely building the bitcoin and the emergency/backup funds at the same time, especially since it could take time to build emergency funds up to a decent level, such as 3 months of expenses or beyond.

At the same time, the emergency funds are largely there to protect the building of investments such as bitcoin, yet emergency funds are kept in dollars/fiat that are largely neither holding their value but also losing their value (purchasing power), so we have to be careful in terms of keeping too much of our value in that crap, even though that crap is needed for the paying of expenses and also the paying of any short falls that we might have in terms of balancing out our cashflows on a weekly/monthly basis.

Sure our investing into bitcoin and various other things that we do with our money including discretionary consumption (or extra expenses that we choose) and our chosen level of savings also comes from our discretionary income, so we should be motivated to try to increase our discretionary income by increasing our income and/or decreasing our expenses, so then we are able to have more money that comes from an increased amount of discretionary income to choose use that extra money to invest, save and/or consume.

You can presume away the guy is going to be able to build up his emergency funds and his bitcoin investment within 3-4 months, yet that does not seem very realistic, even if it might be theoretically possible.

Part of my point is that we should try to be realistic in terms of what guys might be able to do, even if their finances are good and even if they are somewhat gungho about bitcoin, which is also a pretty BIG assumption... and yeah, we might be able to attempt to tailor a relatively gungho approach to bitcoin for ourselves, yet we still need to be working from where we are at and making sure that we don't go overboard in how we might be attempting to both build our bitcoin stash and to make sure that we are either simultaneously building our various back up funds even if we might purposefully choose not to add to our back up funds until our bitcoin size might get to a size that is similar to our already existing back up funds, to the extent that we might already have some thing in place.

A guy plans on Building his Bitcoin investment within 3-4 months is slightly possible depending on his cashflows and the strategy he uses. If he is rich,he is already assumed to have a strong Cashflows. Looking at it theoretically seems possible using the DCA Strategy to buy. Let me set an Examples, A rich guy sets a target to accumulate Bitcoin worth of $5k within 3-4 months interval. If he is earning a total of $2500 per month and his basic needs per month ranges from $800-$1000, let say what is left as his extra cash is $1500. The rich guy can deduct & use $1250k of his Discretional income to buy Bitcoin regardless of the price while the remaining $250 can be used to build his Emergency fund & Reserve fund for the next 3-4 months.

I would hardly characterize the hypothetical guy that you describe as a rich guy.  You are merely describing a hypothetical guy who happens to have a discretionary income that is 50% of his income.

Rich guys may or may not be able to have extra money besides their income to be able to transfer (or reallocate) into bitcoin, and maybe if we are considering guys who are arguably rich (or better off), they may well be able to transfer 1-2 years or more of their expenses into bitcoin in a year or less than a year... so that they are able to front load their investment. .and sure, maybe that is not even rich.. and I am not even claiming that there are very many folks who are so liquid as to be able to transfer 1-2 years or more of their expenses into bitcoin in less, than a year but surely those kinds of folks exist, even though we don't necessarily describe what to do or not to do based on fantasies about other guys rather than trying to figure out the situations of more typical guys, even though from time to time it might be relevant to refer to (or to compare and contrast) situations that might exist for people who have more resources upon which to draw.

Even relatively well to do folks might have to consider the various ways that they are allocating their resources, so it is likely not reasonable to be fantasizing too much about the folks that don't have those kinds of limitations in how they are considering their allocations of value.. and yeah, all of us, whether rich or poor have limitations regarding how we allocate our time and energies, even though some folks are richer in regards to the amount of time and energy that they have as compared with other people.

[Jewan420]

Our emergency funds is as important as our discretionary income when it concerns bitcoin investment, you cannot do without the order these two things are very important in order to succeed in Bitcoin investment if you don't have any of these you will end up dipping hands into your bitcoin investment, some people don't use their discretional income they use money they are supposed to use to pay their bills to invest in Bitcoin and they end up dipping hands into their Bitcoin, some people also don't have an emergency funds and when emergency hits them they end up dipping hands into the Bitcoin.
So you really needs this two to be successful in Bitcoin investment.
And yes you need to have a very strong emergency funds, in terms of building this emergency funds like I always say you can build it alongside with your bitcoin investment all you need to do is to divide the percentage of your discretionary income and I will advise when building this two put more attention in your emergency funds since you will build it for some months or years after building it you can then focus on your Bitcoin investment.

I may agree with you on prudent money, but I disagree with you on emergency funds.

Emergency funds are very important in long-term investing, there is no denying that. But how can you be sure that without an emergency fund, you will have to sell your investments? How can you be sure that there will be an emergency in every person's life? I am not ignoring emergency funds, but rather discouraging certainty about the future. Never quote certainty about the future. Because we do not know the future, maybe someone has an alternative plan for emergency funds or has guardians to provide backup in case of emergency. Even we do not need to keep a lot of money in emergency funds, 3-4 months of expenses will be enough. Evaluate the emergency fund, but not excessive.

[SuperBitMan]

Our emergency funds is as important as our discretionary income when it concerns bitcoin investment, you cannot do without the order these two things are very important in order to succeed in Bitcoin investment if you don't have any of these you will end up dipping hands into your bitcoin investment, some people don't use their discretional income they use money they are supposed to use to pay their bills to invest in Bitcoin and they end up dipping hands into their Bitcoin, some people also don't have an emergency funds and when emergency hits them they end up dipping hands into the Bitcoin.
So you really needs this two to be successful in Bitcoin investment.
And yes you need to have a very strong emergency funds, in terms of building this emergency funds like I always say you can build it alongside with your bitcoin investment all you need to do is to divide the percentage of your discretionary income and I will advise when building this two put more attention in your emergency funds since you will build it for some months or years after building it you can then focus on your Bitcoin investment.

I may agree with you on prudent money, but I disagree with you on emergency funds.

Emergency funds are very important in long-term investing, there is no denying that. But how can you be sure that without an emergency fund, you will have to sell your investments? How can you be sure that there will be an emergency in every person's life? I am not ignoring emergency funds, but rather discouraging certainty about the future. Never quote certainty about the future. Because we do not know the future, maybe someone has an alternative plan for emergency funds or has guardians to provide backup in case of emergency. Even we do not need to keep a lot of money in emergency funds, 3-4 months of expenses will be enough. Evaluate the emergency fund, but not excessive.

Yes without backup funds or emergency funds you will surely dip hands into your Bitcoin investment, as a human as long as you are still living you most face problem and challenges and before such problems and challenges comes to your life they won't tell you, they will just show up and if you don't prepare you will be consumed by the problem or challenges but if you are prepared you will overcome it easily.
You can never know when a thief wants to come to your house to steal but you are conscious that is why you usually lock your door before sleeping.
If you don't have a backup funds or emergency funds then you are not conscious.
Without an emergency funds you will find yourself borrowing money or dipping hands into your Bitcoin it is as simple as that and you may not even think of borrowing and paying interest when you already have Bitcoin that you can sell and use the money to solve your problem.
Yes know one knows the future but everyone knows after night comes morning.

[Finebone]

If you don't have a backup funds or emergency funds then you are not conscious.
Without an emergency funds you will find yourself borrowing money or dipping hands into your Bitcoin it is as simple as that and you may not even think of borrowing and paying interest when you already have Bitcoin that you can sell and use the money to solve your problem.

Investing in bitcoin without no emergency and backups funds makes your investment vulnerable because if any serious emergency situation arise, the likelihood of selling or tempering with your holdings are very high, though their are some investors that have that leverage of investing in bitcoin without an emergency and reserve funds and they will be fine, you know why?
Because they are the rich guys, they have rich family members, friends and uncles that can easily bail them out from any serious emergency situation that may have warrants them to sell or temper with their holdings, but for the survival of our investment if you don't have such leverage, having both of them is a must, for the security of your bitcoin holdings.

[Gost ms]

If you don't have a backup funds or emergency funds then you are not conscious.
Without an emergency funds you will find yourself borrowing money or dipping hands into your Bitcoin it is as simple as that and you may not even think of borrowing and paying interest when you already have Bitcoin that you can sell and use the money to solve your problem.

Investing in bitcoin without no emergency and backups funds makes your investment vulnerable because if any serious emergency situation arise, the likelihood of selling or tempering with your holdings are very high, though their are some investors that have that leverage of investing in bitcoin without an emergency and reserve funds and they will be fine, you know why?
Because they are the rich guys, they have rich family members, friends and uncles that can easily bail them out from any serious emergency situation that may have warrants them to sell or temper with their holds, but for the survival of our investment if you don't have such leverage, having both of them is a must, for the security of your bitcoin holdings.

I agree with you that investing without an emergency fund is risky, but when you say that rich people do not need an emergency fund or a reserve fund, they can take a loan from someone to deal with a financial crisis. I cannot completely agree with you on this point. Because every person needs to create an emergency fund. Because I think that the richer the person is, the bigger the financial crisis will be. And when a person is in trouble, there is no help from anyone. So you should never depend on anyone.

If you have an emergency fund, you can deal with a financial crisis with your own money and you do not have to depend on anyone. If you depend on someone else, if he does not help you during your financial crisis, you may have to sell your holdings, so never depend on anyone, create an emergency fund, it will be good for you. It is best to divide these funds into three levels, such as emergency fund, reserve fund, cash. If you divide it into three stages, it will be better for you.

[Sim_card]

I agree with you that investing without an emergency fund is risky, but when you say that rich people do not need an emergency fund or a reserve fund, they can take a loan from someone to deal with a financial crisis. I cannot completely agree with you on this point. Because every person needs to create an emergency fund. Because I think that the richer the person is, the bigger the financial crisis will be. And when a person is in trouble, there is no help from anyone. So you should never depend on anyone.

If you have an emergency fund, you can deal with a financial crisis with your own money and you do not have to depend on anyone. If you depend on someone else, if he does not help you during your financial crisis, you may have to sell your holdings, so never depend on anyone, create an emergency fund, it will be good for you. It is best to divide these funds into three levels, such as emergency fund, reserve fund, cash. If you divide it into three stages, it will be better for you.

Let's look at it from this angle, a rich has his investments that generates income for him daily/weekly. He has the financial flexibility to tap funds from any of his investments since there are constantly generating more money. The rich guy might choose not to set up an emergency funds and use one of his business or investment to serve as an emergency funds. He don't need to borrow money from anyone if he has a proper plan and good financial management. He will always be on funds.

Only if thr person that you are talking about is only rich in fiat and not in investment. Rich people already have enough funds in their businesses or in the bank that can carter for any kind of emergency that befalls them. Therefore, it's possible that they wouldn't start saving to build an emergency funds because it's on ground already.

Some rich people diversify from their investment into bitcoin because they want to save the value of their money overtime since fiat depreciates in value overtime.

[Wakate]

Investing in bitcoin without no emergency and backups funds makes your investment vulnerable because if any serious emergency situation arise, the likelihood of selling or tempering with your holdings are very high, though their are some investors that have that leverage of investing in bitcoin without an emergency and reserve funds and they will be fine, you know why?
Because they are the rich guys, they have rich family members, friends and uncles that can easily bail them out from any serious emergency situation that may have warrants them to sell or temper with their holdings, but for the survival of our investment if you don't have such leverage, having both of them is a must, for the security of your bitcoin holdings.

I have been seeing emergency fund as backup fund here for couples of pages. Why is nobody taking about portfolio income? When you invest in the stock or bond market just like Philima has been selling part of his silver and copper holdings, the profits which is known as the portfolio income can be used to invest in Bitcoin. Most income we get do not always come from our salaries, many come from our various investments and their is need to talk about these incomes and where we can invest them to yield another profit from us.

You portfolio incomes can be splitted and you can use part of it to buy Bitcoin and add it to your holding. This is another way you can invest in Bitcoin from the profit you made from other mof your investments.

[SuperBitMan]

Investing in bitcoin without no emergency and backups funds makes your investment vulnerable because if any serious emergency situation arise, the likelihood of selling or tempering with your holdings are very high, though their are some investors that have that leverage of investing in bitcoin without an emergency and reserve funds and they will be fine, you know why?
Because they are the rich guys, they have rich family members, friends and uncles that can easily bail them out from any serious emergency situation that may have warrants them to sell or temper with their holdings, but for the survival of our investment if you don't have such leverage, having both of them is a must, for the security of your bitcoin holdings.

I have been seeing emergency fund as backup fund here for couples of pages. Why is nobody taking about portfolio income? When you invest in the stock or bond market just like Philima has been selling part of his silver and copper holdings, the profits which is known as the portfolio income can be used to invest in Bitcoin. Most income we get do not always come from our salaries, many come from our various investments and their is need to talk about these incomes and where we can invest them to yield another profit from us.

You portfolio incomes can be splitted and you can use part of it to buy Bitcoin and add it to your holding. This is another way you can invest in Bitcoin from the profit you made from other mof your investments.

Backup funds is totally different from Portfolio income remember portfolio income refers to money you earn from your investments not from working a job, and yes you can use money gotten from your portfolio income to invest in Bitcoin but before using your portfolio income to invest in Bitcoin you need to remove money from your expenses then what is lift from the portfolio income is what you use to invest in Bitcoin.
Backup funds is not used to invest in Bitcoin it is used to protect yourself through out your investment journey, without having backup funds you will likely find yourself dipping hands into your Bitcoin investment when you are faced with emergency issues.

If you are working you can still have a portfolio income all you need to do is invest in something else which is diversifying and I won't advise for someone who is just starting his Bitcoin investment to diversify at an early stage so as to avoid being distracted but if you can handle the two investment then is fine but if you can I will advise you build your Bitcoin investment to a good level before seeking for portfolio income that comes from diversifying.