JJG’s Outline of Bitcoin Investment Ideas

[Bigjoe33]

I personally always prefer to balance bitcoin investments with as other investments or assets as you can hold, actually we can divide our income in some parts.
For example, if we divide our income into three parts, and 30% is for investing in Bitcoin and 30% is for stable currency holding (or investing on gold) and as well as others 40% could be used for the expenses.

For me personally, I think such diversification of funds into different investment is gonna be a serious distraction from the main goal which is to stack Bitcoin if you have a long term Bitcoin investment goal. This is because if you share your income income in such away as you have mentioned, it will limit the investors plan and deposition to Bitcoin as originally planned. I would like to say that folks who do such sharing might not concentrate entirely I'm bitcoin accumulation and which is not a good way of investing in Bitcoin.

Therefore, I would prefer that an investor concentrates on consistent bitcoin accumulation and Hodl with a long time plan, while also seriously building up his emergency funds and other back up funds that is very necessary to sustain his Bitcoin assets for long time, so that such investor can also liverage on other forms or strategy of accumulating Bitcoin like buying the Dip or lump sum. But a man who has shared his income to different investment scheme would not concentrate as he will be trying to meet up with other ones and would not pay much attention to build up his bitcoin portfolio and also his emergency funds and/or Bach up funds.

[tottong]

Bitcoin investment security will depend on prudent income and building an emergency fund. If every investor builds an emergency fund for his Bitcoin investment, no external danger will be able to touch his Bitcoin investment. As a result, his Bitcoin investment will be able to survive for a long time, and by following the regular DCA method, he will be able to keep it for a long time.

To a certain extent, we must be able to adapt so that our investments can be more prudent in allocating funds for investments and other needs deemed essential for the continuation of life. Most people may talk about how investments can run smoothly but ignore certain funds that we might need later.
Certain patterns can be created based on each person's abilities, allowing them to achieve much more consistent investments, perhaps with varying amounts.
Emergency funds are also not used at any time within the timeframe or period we have prepared, so that this momentum can be used to buy Bitcoin.

As long as we have a clear plan, I am confident that our investments will go well because we have essentially prepared all the funds needed for aspects of life, so that investments will not be disrupted and we will not have to sell Bitcoin when we need money.

[Olatundespo]

I share same sentiment with you. I also recommend investors to build up emergency funds alongside their Bitcoin investments. Any Investors that fail to engage in building up his Emergency fund alongside his Bitcoin investment will endup screwing up his Bitcoin investment whenever he encounters real life emergencies. In other words, figuring out a Discretional incomes and by knowing the amounts he needs from his Discretional income to build up his backup funds is a priority because of he doesn't make it a priority to figure out Discretional funds to build a Emergency fund,his entire Bitcoin investments will looks like a gamble

For beginner investors, it's best to start after they've reached their savings target for a few months. Bitcoin's volatile exchange rate can cause investors to lose some of their money. However, if they have sufficient financial reserves to last for several months, investors won't panic when the market goes down. I see this as a source of fear for investors when starting to invest their money in the exchange. However, if they have sufficient savings beyond their basic needs, they won't panic when the Bitcoin price corrects. In my experience, when the market corrects, there's an opportunity to increase your Bitcoin assets with your reserve funds.

I don't think it's a good investment strategy for new investors to start investing in Bitcoin after reaching their savings target. I think wasting even an hour of time investing in Bitcoin is a missed opportunity for investors. If you know that the price of Bitcoin is volatile it's better to set a strategy for accumulation accordingly. DCA is a strategy through which you continue to buy even during volatile prices and in the long term your holdings will increase. If you doing it regularly instead of panicking during the decline each aggressive buying event will seem like a great opportunity to buy more Bitcoin if you have reserve funds.

[Stormisover]

Bitcoin investment security will depend on prudent income and building an emergency fund. If every investor builds an emergency fund for his Bitcoin investment, no external danger will be able to touch his Bitcoin investment. As a result, his Bitcoin investment will be able to survive for a long time, and by following the regular DCA method, he will be able to keep it for a long time.

To a certain extent, we must be able to adapt so that our investments can be more prudent in allocating funds for investments and other needs deemed essential for the continuation of life. Most people may talk about how investments can run smoothly but ignore certain funds that we might need later.
Certain patterns can be created based on each person's abilities, allowing them to achieve much more consistent investments, perhaps with varying amounts.
Emergency funds are also not used at any time within the timeframe or period we have prepared, so that this momentum can be used to buy Bitcoin.

As long as we have a clear plan, I am confident that our investments will go well because we have essentially prepared all the funds needed for aspects of life, so that investments will not be disrupted and we will not have to sell Bitcoin when we need money.

For a proper and continuity of our investmesnt it is important to have a good financial management skills, this is what will happen us to properly allocate funds according to their level most important. Are you insinuating that emergency funds should be used to buy Bitcoin now and because there is no emergency within certain time? If this is what you are saying such advocate doesn't seem right because it called emergency and can happen at any time we don't expect it, emergency does not announce itself before it happens so we are meant to be ready for it at all times.

[bitzizzix]

Bitcoin investment security will depend on prudent income and building an emergency fund. If every investor builds an emergency fund for his Bitcoin investment, no external danger will be able to touch his Bitcoin investment. As a result, his Bitcoin investment will be able to survive for a long time, and by following the regular DCA method, he will be able to keep it for a long time.

To a certain extent, we must be able to adapt so that our investments can be more prudent in allocating funds for investments and other needs deemed essential for the continuation of life. Most people may talk about how investments can run smoothly but ignore certain funds that we might need later.
Certain patterns can be created based on each person's abilities, allowing them to achieve much more consistent investments, perhaps with varying amounts.
Emergency funds are also not used at any time within the timeframe or period we have prepared, so that this momentum can be used to buy Bitcoin.

As long as we have a clear plan, I am confident that our investments will go well because we have essentially prepared all the funds needed for aspects of life, so that investments will not be disrupted and we will not have to sell Bitcoin when we need money.

For a proper and continuity of our investmesnt it is important to have a good financial management skills, this is what will happen us to properly allocate funds according to their level most important. Are you insinuating that emergency funds should be used to buy Bitcoin now and because there is no emergency within certain time? If this is what you are saying such advocate doesn't seem right because it called emergency and can happen at any time we don't expect it, emergency does not announce itself before it happens so we are meant to be ready for it at all times.

Whatever the reason, it's best not to use your emergency fund for investments, and don't be tempted to do so just because Bitcoin has plummeted and you've made mistakes in managing your emergency fund, which is crucial in the long run.
An emergency fund should be a cash reserve set aside specifically for unexpected expenses or financial emergencies that can arise at any time and without warning, such as illness, layoffs, and so on, requiring you to survive until you find another source of income. This should be carefully considered and planned to prevent your long-term investments, which you've built over time by continuously accumulating, from being destroyed because you don't have an emergency fund when an unexpected event requires a large amount of funds.
Let your accumulation and emergency fund run side by side without any interference, because in the long run, both will benefit you.

[Merit.s]

Emergency funds are also not used at any time within the timeframe or period we have prepared, so that this momentum can be used to buy Bitcoin

It's not proper to invest with your emergency funds even though, you don't have any real life emergency at that moment because you don't know when you will be hit will a real life emergency. Anyone that neglects the importance of emergency funds and invest with it is only gambling and not investing because when you will be hit with real life emergency, you will end selling your bitcoin at loss, if bitcoin price is below your entry point.

Life is full of uncertainty and no one knows when an unforeseen circumstances will befall us which is the main reason why you need to prepare for it and keep your emergency funds to backup your bitcoin investment during your accumulation stage. What if you use your emergency funds to buy bitcoin today and after that a real emergency happens what will you use to take care of it. Don't mess up with your bitcoin investment that you have taken your time to build.

[SuperBitMan]

Bitcoin investment security will depend on prudent income and building an emergency fund. If every investor builds an emergency fund for his Bitcoin investment, no external danger will be able to touch his Bitcoin investment. As a result, his Bitcoin investment will be able to survive for a long time, and by following the regular DCA method, he will be able to keep it for a long time.

To a certain extent, we must be able to adapt so that our investments can be more prudent in allocating funds for investments and other needs deemed essential for the continuation of life. Most people may talk about how investments can run smoothly but ignore certain funds that we might need later.
Certain patterns can be created based on each person's abilities, allowing them to achieve much more consistent investments, perhaps with varying amounts.
Emergency funds are also not used at any time within the timeframe or period we have prepared, so that this momentum can be used to buy Bitcoin.

As long as we have a clear plan, I am confident that our investments will go well because we have essentially prepared all the funds needed for aspects of life, so that investments will not be disrupted and we will not have to sell Bitcoin when we need money.

For a proper and continuity of our investmesnt it is important to have a good financial management skills, this is what will happen us to properly allocate funds according to their level most important. Are you insinuating that emergency funds should be used to buy Bitcoin now and because there is no emergency within certain time? If this is what you are saying such advocate doesn't seem right because it called emergency and can happen at any time we don't expect it, emergency does not announce itself before it happens so we are meant to be ready for it at all times.

I'm one of those people in this forum that always agitate and say that in order for you to succeed in your bitcoin investment you need to have a good and proper management skill without a good management skill it is impossible for you to succeed in your Bitcoin investment.
Management skill will always help you to know how to manage your finance without having a good management skill you won't have any discretionary income lift after every month or week when you receive your salary.
You can't be using your emergency funds to accumulate Bitcoin that is very wrong and it will lead you to failure if you do that emergency funds is meant to be used when you have an emergency and not to be used to buy Bitcoin you can use your reserve funds aggressively when there's a dip.

[JayJuanGee]

I share same sentiment with you. I also recommend investors to build up emergency funds alongside their Bitcoin investments. Any Investors that fail to engage in building up his Emergency fund alongside his Bitcoin investment will endup screwing up his Bitcoin investment whenever he encounters real life emergencies.

Apart from investing in Bitcoin, it should be notable for investors to have emergency fund which can help in time of urgency when you need more to settle some problems that might be inevitable. Many are curious to invest their salary in Bitcoin but they are forgetting that emergency might arrives any time and any day. The need to keep some funds for emergency is to help so you don't go back to your investments and cut it short because you needs to solve some problems.

I've taken several important points from the statement above: it's crucial to set aside living expenses, emergency funds, and risk costs. Only after we discuss investment allocation, because everyone is very different when it comes to their strengths in terms of time, energy, and money. And that's the basic fact; it means we come after cash flow is stable.

So, I think the most difficult thing people will experience when investing is managing money or controlling emotions when facing uncertain market fluctuations. What the next, for investing, the first tip is to increase income, stabilize cash flow, and create or condition ourselves to be calm.

I am not sure what are risk costs, yet I think that the better way of framing the whole matter is that discretionary funds (or income) is available after the basic expenses are deducted, so then from there a person can decide how much he wants to allocate towards investment, consumption and/or back up funds (which includes emergency funds, reserves and/or float). How to allocate discretionary funds after accounting for basic expenses is a matter of how to prioritize each which has some individualistic components.  

If persons make mistakes and allocate their consumption and/or their investment beyond their discretionary income or the put certain portions of their funds into stress, then surely that could contribute to their anxiety, so people have to figure out ways to invest and keep back up funds that do not contribute to their becoming stressed and emotional about it, and sure there might be ways that they can increase their discretionary income by increasing their income and/or by cutting their expenses.  On the other hand, if they are allocating to back up funds rather than consumption or investment, then if they make mistakes, they can take that money from their savings and use it to cover up their mistakes... yet if they consume or invest the money is gone.. Actually if they consume, the money is gone, yet with the investment, even if they locked up the money they could get tempted into tapping into the investment since the money really is not gone, so part of the purpose of the back up funds is to have some source of funds available so that they do not have to tap into their investment (whether the investment is in profits or in the negative, the investment should not be tapped into at a time that is not completely of the investors choosing).

[edited out

Bitcoin investment security will depend on prudent income and building an emergency fund. If every investor builds an emergency fund for his Bitcoin investment, no external danger will be able to touch his Bitcoin investment. As a result, his Bitcoin investment will be able to survive for a long time, and by following the regular DCA method, he will be able to keep it for a long time.

First I don't know what is prudent income. It makes no sense as an idea or a descriptor for the topic we are discussing.  If you are talking about discretionary income or the income that is available after the expenses have been taken care of, then why don't you just use the word that we understand.  Sometimes discretionary income is also referred to as disposable income.

Regarding your point about how the emergency fund will save us, that is not true.  I think that we create emergency funds (and back up funds) to help us through a variety of scenarios, but it is not going to save us from all scenarios.  It is likely that we structure our lives and organize our finances so that we never have to tap into our emergency funds, which largely means that there is always a bit of a financial cushion available, yet there could be extreme scenarios that end up taking place so that we end up having to tap into our emergency funds and even deplete our emergency funds, and so we are trying to protect from the more mild and/or more likely scenarios.. since if the scenarios end up being quite large ones, we will then end up having to dip into our bitcoin, and sure the longer we are in bitcoin then the more likely that we have been able to grow our bitcoin larger and larger, and sure it could become the case that our bitcoin stash becomes so large that we can handle a large number of large financial circumstances that could end up playing out.

[7juju]

I personally always prefer to balance bitcoin investments with as other investments or assets as you can hold, actually we can divide our income in some parts.
For example, if we divide our income into three parts, and 30% is for investing in Bitcoin and 30% is for stable currency holding (or investing on gold) and as well as others 40% could be used for the expenses.

Your comment is very meaningless and through this comment of yours a new person can create a wrong idea in him. Because a person first needs to meet his personal needs or family expenses. If a person divides his income like this then it will never be the right method. We need discretionary income to invest. If a person spends almost the entire amount of his income to meet his family expenses or personal expenses and at the end if he has $10 discretionary income then he can invest. First a person should focus on his family expenses or personal expenses.

A person should not divide his income like this. A person should divide his discretionary income. Where to invest is completely his personal matter but we think a person should never invest in any other type of currency except Bitcoin. All these currencies are very risky and the risk of losing money is very high

But I don't see anything wrong with the way @MINERI said someone can divide their money. The 30% that he dedicated to bitcoin investment can be considered as the discretionary income. He made provision for holding in stablecoins which I believe is almost the same thing as someone having reserve funds or emergency funds in fiat but this one is digital dollar, which can be used to settle problems that may arise. He also allocated percentage for family needs. He didn't advocate for altcoins investment, so I don't see any reason why you should talk down on what he said.

[Finebone]

But I don't see anything wrong with the way @MINERI said someone can divide their money. The 30% that he dedicated to bitcoin investment can be considered as the discretionary income.

It's true that gost ms shouldn't be making it looks like they have an outstanding issues before now, but what miner said is not right, as a bitcoin investor, we are adviced to invest with our discretionary income, money left after all basic needs have been sorted out, not when you have not sort out any of your basic needs.

In this case he has not finished sorting out his basic needs but he has already gotten his discretionary income which I think that their may be a mistake if he doesn't first of all sort out his basic needs. And as we all knows, their will be a problem with his Bitcoin investment if he fails to sorts out his discretionary income right, that's why he shouldn't be dividing his net income like that with the sole intention of investing one side into Bitcoin.

[Loyang]

I personally always prefer to balance bitcoin investments with as other investments or assets as you can hold, actually we can divide our income in some parts.
For example, if we divide our income into three parts, and 30% is for investing in Bitcoin and 30% is for stable currency holding (or investing on gold) and as well as others 40% could be used for the expenses.

Your comment is very meaningless and through this comment of yours a new person can create a wrong idea in him. Because a person first needs to meet his personal needs or family expenses. If a person divides his income like this then it will never be the right method. We need discretionary income to invest. If a person spends almost the entire amount of his income to meet his family expenses or personal expenses and at the end if he has $10 discretionary income then he can invest. First a person should focus on his family expenses or personal expenses.

A person should not divide his income like this. A person should divide his discretionary income. Where to invest is completely his personal matter but we think a person should never invest in any other type of currency except Bitcoin. All these currencies are very risky and the risk of losing money is very high

But I don't see anything wrong with the way @MINERI said someone can divide their money. The 30% that he dedicated to bitcoin investment can be considered as the discretionary income. He made provision for holding in stablecoins which I believe is almost the same thing as someone having reserve funds or emergency funds in fiat but this one is digital dollar, which can be used to settle problems that may arise. He also allocated percentage for family needs. He didn't advocate for altcoins investment, so I don't see any reason why you should talk down on what he said.

Gost's comment may be a bit confusing, but I think that what @|MINER| said may not be the right approach to me. Because first we have to find out our expenses. If after spending we get some discretionary income then maybe we can invest with that. |MINER| He mentioned investing with his income which will never be the right approach in terms of investment. Many, many more money is spent than the amount of expenses that can be estimated in a month or week. If we invest in advance then if we need more money in a week or month then maybe we will have to break the investment or if we have an emergency fund then we will have to take money from the emergency fund. This will never be the right approach

What will be best for a person is that first of all a person should have the importance of proper financial management. From his income, he should find discretionary income through proper financial management and invest with that discretionary income. This will be the best investment method for an investor and will be very low risk.

[G_Besar]

But I don't see anything wrong with the way @MINERI said someone can divide their money. The 30% that he dedicated to bitcoin investment can be considered as the discretionary income.

It's true that gost ms shouldn't be making it looks like they have an outstanding issues before now, but what miner said is not right, as a bitcoin investor, we are adviced to invest with our discretionary income, money left after all basic needs have been sorted out, not when you have not sort out any of your basic needs.

In this case he has not finished sorting out his basic needs but he has already gotten his discretionary income which I think that their may be a mistake if he doesn't first of all sort out his basic needs. And as we all knows, their will be a problem with his Bitcoin investment if he fails to sorts out his discretionary income right, that's why he shouldn't be dividing his net income like that with the sole intention of investing one side into Bitcoin.

Perhaps he still needs to learn how to use his money for various things, so he knows how much is left over after he prioritizes his daily needs. In other words, he needs to learn about good financial management so he can understand that discretionary funds are the funds left over after he prioritizes his daily needs. So, he only needs to direct himself to that if he already knows Bitcoin well and also understands about investing. However, he needs to differentiate between the long-term investment journey for Bitcoin and the short-term investment journey which is completely unsuitable when applied to Bitcoin.

[Cossyblack]

I would not presume that building up emergency funds that are three months of your expenses is easy. It could take a year or two.

I also do not recommend building up an emergency fund prior to getting started investing into bitcoin. 

There surely has to be some back up funds that are present when investing into bitcoin, and guys have to figure out how much they are going to need while engaging in such build up, and if they screw up they are going to be the one to pay in the event that they failed/refused to build up and keep sufficient back up funds.

I also hypothesized that a lot of people already are in the practice of keeping some level of back up funds, even before they get to bitcoin, so they might already be starting with 2-6 weeks of back up funds yet when they get started with bitcoin, they likely need to start thinking abut their back up funds in a context of protecting their bitcoin, while at the same time building up the bitcoin, and we can even suggest that back up funds would not need to be as large in the first place until the bitcoin investment grows and grows and grows (presumptively growing from both adding to it and from price appreciations, even though price appreciation is not guaranteed to happen), so then the more and more that bitcoin is growing, the more that there will be a need to protect it from accidentally or purposefully getting tapped into, so back up funds should help with that.. and yeah sometimes cashflow situations can become extreme where the income does not cover all of the expenses, and so in those situations having some cash on hand can end up being quite empowering in terms of giving options and options that include not beign forced to tap into the bitcoin investment at a time that is not completely at your own choosing..

I personally always prefer to balance bitcoin investments with as other investments or assets as you can hold, actually we can divide our income in some parts.
For example, if we divide our income into three parts, and 30% is for investing in Bitcoin and 30% is for stable currency holding (or investing on gold) and as well as others 40% could be used for the expenses. I don't know if this strategy will work for others, but if I follow this approach based on my income, I won't have to face any extra hassle.
Because I have seen many people, and it happened to me in the beginning, who, seeing the potential of Bitcoin, forgot about its volatility and invested most of their income in it. Later, when the market crashes or the price drops and they need their own money, they have to sell the invested holding Bitcoin at a loss and provide a backup to the situation.

So I think if someone invests strategically based on their income with long-term DCA plan, they will be able to successfully execute their investment.

With the mindset you have,I doubt if you will make it to Over-accumulation in Bitcoin because you're busy sorting out Discretional incomes to invest in Gold when you haven't accumulated Bitcoin substantially or come close to Over-accumulation. Diversification to other assets like Gold,Stock & Bond or Real estate isn't bad but since you haven't come close Over-accumulation,i think your Discretional income when available should be used to buy Bitcoin consistently for the next 4-10 years until you have attain Over-accumulation before Diversifying.

[7juju]

But I don't see anything wrong with the way @MINERI said someone can divide their money. The 30% that he dedicated to bitcoin investment can be considered as the discretionary income.

It's true that gost ms shouldn't be making it looks like they have an outstanding issues before now, but what miner said is not right, as a bitcoin investor, we are adviced to invest with our discretionary income, money left after all basic needs have been sorted out, not when you have not sort out any of your basic needs.

In this case he has not finished sorting out his basic needs but he has already gotten his discretionary income which I think that their may be a mistake if he doesn't first of all sort out his basic needs. And as we all knows, their will be a problem with his Bitcoin investment if he fails to sorts out his discretionary income right, that's why he shouldn't be dividing his net income like that with the sole intention of investing one side into Bitcoin.

But you saw were he made mentioned that 40% of his income will be used for expenses. What do you think the expenses he is talking about? It is personal and family needs. Or you are getting confused because he didn't tag it family expenses? The moment I read his post I understood that the 40% he allocated for expenses is covering for his personal and family needs for that month or week. He is the investor, and he already knows what his family needs are and has concluded that 40% of my salary is enough to cover expenses.

He wants to deduct from source and send those amounts to the different accounts that they belong once his salary is paid. One must not wait to finish expenses before knowing how much they will have as discretionary amount. You can know how much you want to assign to your discretionary income by allocating percentage of your total income towards that even when you haven't been your paid for the month or week.

[JayJuanGee]

I have moved my below response from another thread to this thread, since it seems more fitting to this thread.

My words may seem a little messy, if I make any mistakes, please correct me. When I learn to understand all the topics, then I will be able to explain the right things to others.

No problem.  Many of us are still learning, and of course, the kinds of things that we learn might be different, but sometimes it can take a lot of repetition before some of the terms might start to make sense.  So for example, you might read some forum threads and get some ideas, and then maybe you will go try to apply the ideas and you will write down what you are learning, but then you might be writing questions about areas that you don't know, so then the list of what you don't know might seem way longer than the list of what you know... So yeah, repetition should help for some of the ideas to sink in and perhaps to help to direct you to areas in which you might want to focus learning, since some topics might seem more interesting and applicable as compared with other topics might seem like they don't really apply to your current areas of interest.

Feel free to ask me questions in this thread or even in the other thread, and sure some other guys might answer your questions too... and I might not always answer in ways that you would feel helpful or applicable to your own circumstances, yet part of that is your job to figure out how to apply the theory to your own situation...and to work out the parts that make sense and perhaps not apply the parts that don't make sense... and you might find yourself with your own system or you might end up screwing things up if you make some changes and then you realize that you ended up making mistakes in the way that you applied it or interpreted it, but if you are starting in small amounts, then you should be able to figure out ways to control your emotions about what you are doing and/or any BTC price moves that might come in the future.

Of course, if you are doing a lot of your own work and studying, then you willl also be able to present aspects of what you are doing and you don't necessarily need to be telling the truth about how much money you are using or where you live, yet you can still present information that might allow guys to learn from what you are doing... which is part of the justification for participating in a forum like this.  I can remember some guys coming up with interesting ideas about how they were going to DCA and even they were going to give up certain kinds of junk food and bad habits and then use that money to buy bitcoin, and then poof.. they just disappeared... and sure by now some of them would have had become really rich, especially those guys who were doing that prior to 2021.  Anyhow, each guy has to deal with his own life, so I am not blaming that some guys gave up on buying bitcoin (or at least gave up on posting about it).

I have been reading your investment posts for almost the whole day and trying to understand . I have written down the main points in the form of notes as you advise, and the points that I could not clear, I have written them myself. You have presented the issues very beautifully from the beginning to the end of the investment. You have explained the issues through realistic examples and have solved the problems of many. If I write in point form  that I have understood after your post are as follows.

1. Before starting to invest in Bitcoin, we must have the desire to learn and  can start investing with small amounts. Another thing is that we have to start investing with the money that is left after meeting basic needs. That is called  discretionary income. I was never familiar with this word before, but it is a very important  in investment, which I have seen mentioned repeatedly in your writing and the othe posts by those who post on investment issues.

Yep.  it is good to have a bit of a grasp that you are investing ONLY with money that is left over after your basic expenses, which is your discretionary income.  There might be fluctuation in that amount depending on your income and your expenses, which each can fluctuate.

2. Before investing, you should keep an amount equal to 3 to 6 months of expenses as an emergency back-up fund. If you have invested for a few years, if there is any financial problem, you can use the backup fund instead of selling Bitcoin.

I don't say that.  I say that you need to have some back up funds (aka emergency funds) since you never want to invest from money that you need for your expenses, so you have to make sure that you don't mistakenly use money that you need for your expenses, and one of the best ways to protect from using money that you need for your expenses is to have back up funds, and I don't say that you need to build them up before you start. Instead, I suggest getting started as soon as you can, as long as you have discretionary income, and you are not going to know that you are ONLY using discretionary income if you don't have any back up.. ...

I also suggest to build your back up and your bitcoin investment at the same time until they each get up to 3 months invested into them, and then once you have three months, you can become even more aggressive because you have your back up funds in place.  You have the option to build your back up funds faster than your bitcoin or your bitcoin faster than your back up funds.  There is no strict rule.  You have to figure out a balance that feels comfortable, and if your income and expenses is strong then you likely can build the bitcoin faster, but if your income and/or expenses are weak (or vary uncertain), then you likely need to build more cushion into your back up funds.

If you screw up in figuring a good balance in terms of how whimpy or aggressive you are, then you are going to be the one to pay for your screw up, so it is likely good to practice and to start out conservative while you are getting used to how your cashflow is working out, including if you are planning to invest in bitcoin for 4-10 years or longer, then the money you put into bitcoin is locked up.. so you have to make sure that you ongoingly have enough cash to cover your expenses whether from regular income or from your back up funds during periods that your expenses are greater than your income.  

Many folks come to bitcoin and they already have some back up funds that are in place that might add up to 2 weeks to 6 weeks of their expenses.  If they already have some money that is serving as back up funds, then they would factor that in regards to how much bitcoin they might choose to buy.. and maybe they will buy bitcoin several weeks before they even add any more to their back up funds.

3. When buying Bitcoin, you have to buy it through DCA. I searched on Google and found that DCA means Dollar Cost Averaging. You have to buy Bitcoin with a certain dollar every month or week.

You have three options for buying. DCA, lump sum and buying on dips.  DCA is a good way to start, and I think weekly is good too.  You are the one who decides how you want to do it and/or how aggressive you are going to be.

For example, if you have $2k in income every month and $1,200 in expenses every month, then you have $800 in discretionary income.

You could choose to invest $100 per week into bitcoin and that would be right around $433 per month (since there are on average 4.33 weeks in each month).  Maybe they choose to invest less in bitcoin so that they could build up their back up funds, but if they already have some back up funds, such as $800 worth of back up funds, maybe they decide to buy $100 worth of bitcoin for 8 weeks before they will start to add to their back up funds.  There are a variety of ways to justify what they are going to do, and if they make mistakes they might either lose money or they might  just have to tweak what they are doing.

Maybe they invest into bitcoin for 6-8 weeks and they start feeling stressed about their investment because the price is going down, so maybe they can make an adjustment, yet I don't know what that adjustment would need to be based on the price, since the price does not matter very much... what matters is their budget... So if their income goes up or down, they might have to adjust based on their income.. The same is true in regards to expenses.. so initionally the BTC price should not really matter very much since if they are investing for 4-10 years or longer, the price changes should not matter, and if they are getting concerned about the price changes, then maybe they have to invest less so that they don't worry about it so much... yet I am not even sure if investing less will resolve the problem.. since guys have to consider a variety of aspects of their 9 individual factors.  

4. I am not very clear about the topic of Sustainable Withdrawal. I understand this by observing that you have a thread on this topic that if you have invested in Bitcoin for a long time, when the price of Bitcoin increases, you can sell Bitcoin from there and meet all your expenses.

In the beginning you are building up your investment so you are in your accumulation stage, and then later you will reach your maintenance stage and then later you will reach your liquidation phase (or sustainable withdrawal stage).

It is probably more important to concentrate on your accumulation stage first, since it can take a couple cycles or more before you get through your accumulation stage... and you have to do your various calculations regarding your goals... whether or not you are trying to get to fuck you status (a point where you can quit your job and live off of your bitcoin, and you don't just get to such a point magically).. even guys who have been in bitcoin for a long time, might not feel that they have reached such status, and even guys who front loaded their bitcoin investment by taking from other investments, they also might not feel that they have enough bitcoin.  It seems to early for you to be getting distracted by sustainable withdrawal or even overaccumulation status, since you have to accumulate first.

I would suggest that even a guy that comes to bitcoin with a million dollars, he is not going to necessarily reach overaccumulation status without some passage of time, such as a whole cycle of having had invested, even though people can do what they like, even dumb shit.  Investment tends to take a lot of time whether you invest gradually over a cycle or two or even if you might be able to front load your investment with some lump sum amounts to get it started.

5. You have prohibited waiting to buy Bitcoin at a low price in many places. The price decrease may be called DIP. Which is not correct to wait buy bitcoin at dip because it is not known how much Bitcoin will be.

I recommend ongoing buying rather than trying to buy dips, especially if you are investing from a regular income.  You invest from your income as it comes in rather than waiting.  If you want to hold some portion back for buying on dips, that is your choice, but you are probably going to be better to just buy every week rather than holding money back.  It is up to you in regards to the extent that you think holding back and waiting for dips is a good strategy. since there have been plenty of times in bitcoin's history that waiting has not worked out very well..  I am not prohibiting anything, since ultimately each guy has to choose and live with the consequences of his choices... there have been plenty of guys who get themselves worked up because they are too busy trying to figure out when or when not to buy, and it probably puts them into a bad mindset as compared to guys who are regularly, consistently, persistently, ongoing and perhaps even aggressively buying...  

It could take 4-8 years or longer before you realize the extent to which you made mistakes when you had choices earlier.  Think about many guys coming into bitcoin in 2022, and if they were fucking around waiting about when to buy, they would have been worse off as compared with the guys who bought as much as they could as soon as the money came in.

Instead of getting started and buying right now, you might have some target price that you would like the bitcoin price to fall, which may or may not end up happening.  I don't find it productive to be waiting for dips that might not happen, but you have to figure out for yourself what you want to do, and if you invest 80% of your bitcoin allowance right away and hold 20% for buying dips, I don't have any major problem with that plan, even though it may not end up being a good plan if you let it distract you from regularly buying, perhaps every week or when your cashflow situation allows it.

6. The investment period should be 4 to 10 years. It has been mentioned for a long time investment.

if you want to invest rather than trade then the timeline is likely greater than 10 years, and the only reason you would have less than 10 years would be based on age and/or health considerations.  I recommend investing in bitcoin, not trading it.

You can do what you like.  maybe you come in and you are not sure if you can commit to 10 years or longer, so you start out and you have your own opinion while you are considering perhaps keeping your money in bitcoin for 10 years or longer.  Of course, you are in charge of your own money, so you can do what you like, but if you don't have a longer timeframe mindset, you might not be as committed to keeping your money in bitcoin and building it.

There are some folks who come to bitcoin and think of bitcoin as a trade, but then after they are in bitcoin for a while, they change their ways of thinking about it...

In late 2013 when I first came to bitcoin, I thought that I would keep it 1-2 years or longer, but I think that bitcoin was newer so it was harder to figure out having a longer investment timeline, yet my time in bitcoin got me thinking that bitcoin is an investment that has a minimum of a 4 year timeline, even though other folks think about bitcoin differently and they think about flipping bitcoin or trading waves.  I don't agree with those ways of thinking about bitcoin, even though I understand that some people think about bitcoin in those kinds of shorter-term ways.

But I still don't understand some things. I have written the questions and I am mentioning them.
I would like to request everyone including JayJuanGee (if you have time )  to clear the issues for me.
Please explain in a simple way so that I can understand easily.

1. Overaccumulation status may mean having enough Bitcoin. But how do I understand what my Overaccumulation status is?

Let's say that in 2016, you had a $30k income and you spent nearly 10 years investing in bitcoin, and your income had gone up to $50k.  In 2016 you started investing around $100 per week into bitcoin, yet as your income had gone up you increased the amount that you were investing into bitcoin.  By now you had close to 20 bitcoin.  Initially, you were thinking that if you could just get enough bitcoin to replace your income, then you would be comfortable that you have enough or more than enough bitcoin, yet in recent years you were thinking that if you could at least support yourself with an $80k per year income, then you would have enough bitcoin.

Personally, I think that right now, if a guy had 14.5 BTC, then he has enough to start to live off of his bitcoin at a rate of $80k per year forever and ever (based on the 200-WMA value of such holdings)..  He could even increase his withdrawal rate by 7% each year.

Now if the hypothetical guy has close to 20 BTC, then any BTC that he has greater than 14.5 BTC is an overaccumulated amount  (beyond his income goals of $80k per year).  Also each year, the amount of BTC needed to sustain an $80k per year income is going to be less and less and less.. so if the guy is withdrawing $80k per year, then his stash size is likely growing faster than his withdrawal rate, but if he has 25% more than his target withdrawal rate (20 BTC rather than 14.5 BTC) then he has accumulated more than he needs to sustain himself at $80k per year.

2. 4 to 10 years is a long time. How can I build patience and confidence mentally for such a long investment? I don't understand the issue of sustainable withdrawal, please clarify a little about how it will work. There were many mathematical terms in JayJuanGee's thread which seemed a bit complicated to me. If I don't need to know this right now, then I will try to understand it myself later.

You likely don't need to worry about overaccumulation status or sustainable withdrawal, since it likely would take quite a long time to reach such status, perhaps even longer than 4-10 years.

If you invest around 10% of your income per year into bitcoin, it would take you 10 years before you put a year of your income into bitcoin.. .and if you invest 25% of your income into bitcoin, it would take you 4 years to put 1 year of your income into bitcoin. You cannot know whether or how fast bitcoin will grow, even though the more you invest into bitcoin, the better off you are if its price ends up appreciating in value and you already have money in it.

You can monitor how much you put into bitcoin and how it grows over the years in order to determine at what point you might be reaching overaccumulation status.  You measure based on your own goals and life circumstances.

3. I do a job and if I convert the income to dollars, it is about $750 per month. So if I start investing in Bitcoin from here, how do I view that investment as a retirement fund, future savings plan, or alternative investment?

If you don't have any other investment, then you just have the bitcoin.  I think that it is o.k. to start out with just bitcoin and cash... and it is up to you if you feel that you need some other investments or if you are coming to bitcoin with other investments.  If you don't have any other investments, and you decide to add other investments, then you likely are diluting your bitcoin investment.  That is up to you too, in regards to how much money to put into bitcoin as compared with other places to put your money.

4. One thing I see many people talking about when it comes to investing in Bitcoin is emotional control. If the price drops, many people get scared and sell. I have no experience with this because I have not started investing yet. However, if such a situation arises after starting, how can I keep myself mentally stress-free?

Usually position size can be helpful, meaning if you are going to get emotional about $100 per week, then maybe cut back to $30 per week or some amount that will allow you to live your life and not get too worked up about it.  

Many times guys get used to how to deal with their stack size, yet some guys are more emotional than others, so it might be difficult to figure out some kind of a balance to keep you from becoming emotional.. since if you invest too much, then you are emotional if the price goes down, yet if you invest too little then you will get emotional when the price goes up (because you will feel that you did not invest enough when the price was lower). Ultimately you have to attempt to figure a balance that prepares you for either direction and both directions... Also, if you are buying every week, the weekly buys will help to reinforce your investment but also might motivate you to research further into bitcoin (since you will be adding additional value every week). .. Even $30 per week would be $1,560 invested per year and $15,600 after 10 years.  Relatively small amounts can add up towards being a lot invested.

5. The thing that has made me very curious is that the price of Bitcoin keeps going up and down. In fact, for what reason does the price of Bitcoin go up or down?

Bitcoin is inevitably volatile and we do not know which direction in the short term.  We invest into it since we presume that ultimately it will trend upwards, especially in the long term (even though it is not guaranteed to trend upwards in the long term).

I am trying to gain mental strength, courage, and a passion for Bitcoin to enter the world of Bitcoin very soon. If I hadn't come to this forum, I would never have known that Bitcoin topics are so broad and that there is such a huge market for Bitcoin.

Start out small and study it.  Bitcoin is a very interesting topic, and it can take years and years to really get to know it, and even guys like me who have been in bitcoin for 12 years, we still have ongoing ways to study bitcoin.

[Graph001]

I share same sentiment with you. I also recommend investors to build up emergency funds alongside their Bitcoin investments. Any Investors that fail to engage in building up his Emergency fund alongside his Bitcoin investment will endup screwing up his Bitcoin investment whenever he encounters real life emergencies.

Apart from investing in Bitcoin, it should be notable for investors to have emergency fund which can help in time of urgency when you need more to settle some problems that might be inevitable. Many are curious to invest their salary in Bitcoin but they are forgetting that emergency might arrives any time and any day. The need to keep some funds for emergency is to help so you don't go back to your investments and cut it short because you needs to solve some problems.

I've taken several important points from the statement above: it's crucial to set aside living expenses, emergency funds, and risk costs. Only after we discuss investment allocation, because everyone is very different when it comes to their strengths in terms of time, energy, and money. And that's the basic fact; it means we come after cash flow is stable.

So, I think the most difficult thing people will experience when investing is managing money or controlling emotions when facing uncertain market fluctuations. What the next, for investing, the first tip is to increase income, stabilize cash flow, and create or condition ourselves to be calm.

You have made a good point but I personally think that if you want to be a successful investor, you should not spend much time building up a fund but rather increase or stabilize your income so that you can continue to invest regularly and on the other hand, meet the needs of your family and yourself properly. Because something unexpected can happen and it can happen more than once, in that case you cannot rely on the emergency fund again and again. In that case, if your income is stable, you will be able to overcome the upcoming adverse situation relatively easily and this is not only in terms of investment, the current inflation and the increase in the price of goods that you are currently seeing may increase in the future, in that case, the more stable your income is, the more advantageous you will be in terms of it.

[Saltysugar99]

First of all @JayJuanGee I would like to thank you for explaining all the things to me in such a detailed and simple way. Although I had read your posts in this thread, I may have misunderstood some things . That is why there were some misunderstandings and some things were not clearly understood. Now I have understood correctly, especially the topics of backup fund, Bitcoin accumulation and DCA investment method. And you have explained the topics step by step with real examples and I had some questions you also clarify that . I have no problem with these  now. I have also got a strong idea about long-term mindset, patience, and emotion control.

My monthly income is $750. My salary is incremented by 10% every year. I spend about $500 every month for my daily life expenses , out of the remaining $250, I have a fixed deposit savings of about $80 which will take about 2 years to finish. I have $150 to $170 per month as discretionary income. I can buy Bitcoins every month for $80 to $100 based on my current situation, but since I will have to spend both my backup fund and Bitcoin accumulation, I might buy Bitcoins for $50 initially and keep the remaining $50 as a backup fund. For me, the fund management for buying Bitcoins every week seems a bit troublesome. I can buy Bitcoins as soon as I get my monthly salary. I thought like this at the initial stage.

[bitmover]

My monthly income is $750. My salary is incremented by 10% every year. I spend about $500 every month for my daily life expenses , out of the remaining $250, I have a fixed deposit savings of about $80 which will take about 2 years to finish. I have $150 to $170 per month as discretionary income. I can buy Bitcoins every month for $80 to $100 based on my current situation, but since I will have to spend both my backup fund and Bitcoin accumulation, I might buy Bitcoins for $50 initially and keep the remaining $50 as a backup fund. For me, the fund management for buying Bitcoins every week seems a bit troublesome. I can buy Bitcoins as soon as I get my monthly salary. I thought like this at the initial stage.

Why dont you try to join signature campaigns in the forum?
You can earn like $20-50 usd per week pretty fast as you rank up a little bit.

Every small amount of incomes helps in your accumulation phase

[JayJuanGee]

For me, the fund management for buying Bitcoins every week seems a bit troublesome. I can buy Bitcoins as soon as I get my monthly salary. I thought like this at the initial stage.

Of course, you can do whatever you like in terms of frequency.  I gave my recommendation for weekly, which largely relates to attempting to incentivize activism, learning and potentially more aggressiveness, which likely is preferred while you are getting used to investing in bitcoin, yet I recognize that the amount is so small that it is going to take you quite a bit of time to really invest a sizable amount of value into bitcoin since you are ONLY investing about 6.7% of your income into bitcoin, and for several years (probably since at least 2020), I have been recommending investing 5% to 25% of your income into bitcoin, so you are towards the lower end of my own recommended investment range and at the same time, surely better than nothing, and you have to figure out what works for your own situation, which you seem to have worked through how to apply your own numbers... and you could put yourself into a worse situation if you ended up overstressing yourself, either financially or psychologically... .. and you can see how your currently chosen system goes and make adjustments to it from time to time as you get used to having the application of your system within your monthly routine.

[The Founding Titan]

I share same sentiment with you. I also recommend investors to build up emergency funds alongside their Bitcoin investments. Any Investors that fail to engage in building up his Emergency fund alongside his Bitcoin investment will endup screwing up his Bitcoin investment whenever he encounters real life emergencies.

Apart from investing in Bitcoin, it should be notable for investors to have emergency fund which can help in time of urgency when you need more to settle some problems that might be inevitable. Many are curious to invest their salary in Bitcoin but they are forgetting that emergency might arrives any time and any day. The need to keep some funds for emergency is to help so you don't go back to your investments and cut it short because you needs to solve some problems.

I've taken several important points from the statement above: it's crucial to set aside living expenses, emergency funds, and risk costs. Only after we discuss investment allocation, because everyone is very different when it comes to their strengths in terms of time, energy, and money. And that's the basic fact; it means we come after cash flow is stable.

So, I think the most difficult thing people will experience when investing is managing money or controlling emotions when facing uncertain market fluctuations. What the next, for investing, the first tip is to increase income, stabilize cash flow, and create or condition ourselves to be calm.

You have made a good point but I personally think that if you want to be a successful investor, you should not spend much time building up a fund but rather increase or stabilize your income so that you can continue to invest regularly and on the other hand, meet the needs of your family and yourself properly. Because something unexpected can happen and it can happen more than once, in that case you cannot rely on the emergency fund again and again. In that case, if your income is stable, you will be able to overcome the upcoming adverse situation relatively easily and this is not only in terms of investment, the current inflation and the increase in the price of goods that you are currently seeing may increase in the future, in that case, the more stable your income is, the more advantageous you will be in terms of it.

I think the purpose of an emergency fund is to safeguard you when you income disappoints you, at least that has to be one of the purpose of an emergency fund, sure you can work to stabilize your income from your workplace, you could even get an extra job in order to increase your income but what if you got in an accident and you had a property damage that your insurance cannot immediately cover since we all already know that the payment of insurance gets delayed sometimes, you income for that month hasn't arrived and you don't have an emergency fund, how do you handle yourself in this situation, the emergency fund will play an essential role in salvaging this situation but this can only happen if you already have an emergency fund so instead of saying that your emergency fund isn't all that necessary then think again because it's very important and you should start building up yours if you have the means to do so but haven't started yet.