JJG’s Outline of Bitcoin Investment Ideas

[Silikiem]

You literally mixing things up here, the definition of  discretionary income with that of a budgeting strategy. By the definition in finance, discretionary income is the money that is left after all your basic necessities, living costs, and short term obligations ( including emergency savings) are taken care of.  Read more : https://www.investopedia.com/terms/d/discretionaryincome.asp

In the aspect we’re you are taking money out of your discretionary income to build up your emergency fund than that money was never a discretionary in the first place. It was essential financial obligation.

For your 3 part split strategy, it fine to allocate leftover cash. But calling money discretionary before your emergency cushion is built that really dangerous. Once a real life emergency happens and you haven’t built up your cash fund yet, you are going to be forced to dump your Bitcoin at a loss to pay for it. A safety net first then a true discretionary stacking.

Remember that the discretionary income is the cash left  after sorting out your basic needs, and also it is this discretionary income we are to use and start investing In bitcoin. So, If you are classifying the Emergency funds as a part of the basic needs that an investor must need to fulfill before investing In bitcoin then you’re asking people to first build an emergency funds before they can start buying bitcoin. Is that what you’re trying to achieve?. I don’t think the emergency funds is a part of our basic needs in life, a man’s basic needs for his daily survival includes housing or shelter, food, clothing, and payment of other utilities like electricity, water etc. the emergency funds is just a financial safety net which can come after sorting out the basic needs and even when the investor have started buying bitcoin and HODL so it’s not a basic needs but an important part of our bitcoin investment which provides us a safety net when in an emergency situations.

It is from your discretionary income you can now  decide how much of that discretionary income you’ll want to allocate towards buying bitcoin and how much of it you will want to use for building the emergency funds and that’s why I think the emergency funds is a part of the discretionary incomes and not really part of the basic needs income.

[LodBtcFast55]

You are right, and to add to it, aside DCA making it very easy to invest, it doesn’t delay your investment. It helps you invest the very minute you have your discretionary income. We know there are several strategies in bitcoin, but this thread also prioritize using the DCA.

Instead of thinking of using other strategies like buying the Dip, why not take advantage of the dip and lump sum instead of waiting and possibly missing out on investing in bitcoin.

We all know bitcoin investment is never meant to be delay, other strategies will only allow you to wait. DCA have several advantages over other strategies, so why use them.

Avoid all such challenges like changing or making decisions repeatedly based on the current market situation and use the DCA strategy. It will keep you free from those challenges. Many people expect to buy at a good price according to their wishes, but in the end, they miss the opportunity to buy at a good price. Only proper planning and strict decision-making are effective methods for investing. Every wrong decision and short-term plan that you make can cause you to lose money because Bitcoin is a long-term asset. The DCA strategy is suitable for everyone, so investing through it is an effective method.

[Jewan420]

Yes as an experienced investor this is the best advice you can give to someone who wants to start Bitcoin investment, because there are people whose own research isn't enough but advice like this will actually boost their confidence. Bitcoin price can fluctuate and waiting for it to dip before buying will make someone stay for a long time without having anything in their portfolio. Meanwhile someone who uses the DCA strategy will keep growing theirs because they don't have to wait for a dip to buy. That's why DCA is considered the best strategy for both rich and poor because it saves them from sitting on the sidelines for years.

In addition to continuous buying, DCA frees you from complex issues such as market analysis and frees you from complex decision-making. When doing DCA, you do not have to search for the right time and do not have to be afraid of missing the right time. Market volatility will not affect you in terms of buying and DCA gives you relative freedom in determining the amount. By being active with the market, you will also get the opportunity to buy at lower prices.

[Joeboy]

~snip~

In addition to continuous buying, DCA frees you from complex issues such as market analysis and frees you from complex decision-making. When doing DCA, you do not have to search for the right time and do not have to be afraid of missing the right time. Market volatility will not affect you in terms of buying and DCA gives you relative freedom in determining the amount. By being active with the market, you will also get the opportunity to buy at lower prices.

I think that you folks are mistaking DCA for something that it isn't...DCA wouldn't make you or anyone escape volatility and it is best for you not to think otherwise..If your decision is to invest in Bitcoin, then volatility is unavoidable, inescapable and it is something that gets to affect the value of your portfolio at any time..This means that you could buy Bitcoin when the price was around an amount and in a couple of minutes or hours the price drops down or say surges up again...And implementing DCA cannot stops this price movement from happening, nor does it even guarantee that the value your money investment will keep surging upward...What I know for sure is that DCA  enables folks to spread out their buys over a period of time so as to reduce the pressure which is mostly associated with market prediction and price timing..However you will still be exposed to the same market volatility as any Bitcoin investor.

[Lembo69]

It is from your discretionary income you can now  decide how much of that discretionary income you’ll want to allocate towards buying bitcoin and how much of it you will want to use for building the emergency funds and that’s why I think the emergency funds is a part of the discretionary incomes and not really part of the basic needs income.

I think that an investor should keep a larger portion of the money he keeps for his investment from his discretionary income to buy Bitcoin. And he should keep a small amount for emergency fund. For example, let's say 70% for buying Bitcoin. And 30% for emergency fund. In simple terms, if someone has discretionary income of $100, then he should invest $70 and $30 for emergency fund. In this way, he should manage his investment. Emergency fund helps us to sustain our investment in case of emergency, so without emergency fund, investment is incomplete. An investor can do whatever he wants with his investment. But if he does not apply his own judgment while investing, then he will put his investment at risk. So we should be calm and make all decisions while investing. And pay attention to other management including emergency fund.

[Agbam]

Yeah he’s got it all wrong and mixed up, the discretionary income is used for investing but that doesn’t mean you should invest all of it unless you have already have a substantial backup funds then you can afford to be 100% aggressive into bitcoin.

To make one slight correction on your part @Big Dirams; Discretionary income isn’t just free money or extra money without any responsibility because it has it’s own responsibilities. As you use your main income to satisfy your needs your discretionary income satisfies your wants. It is used to invest, save and/or discretionary spend.

I  do not see anything wrong if someone decides to go all in with their discretionary income if they have or sees an opportunity to do that, since the job of the discretionary is to invest so there is nothing wrong because you will still grow another one from your source of income. discretionary income is an extra cash, a leftover cash, remaining cash after all needs must have been taken care of but yea, this does not mean it is not useful of course it is very useful yet it is someone that will make it to be this useful because there are people who make their discretionary income look useless by using it wrongly.

The purpose of the discretionary income isn’t just to invest, it is from this money you build your backup funds that’s your emergency and reserve funds. It’s also from this money you take yourself out for a treat, gamble, buy gifts etc…

Now If you put all your discretionary money into bitcoin and you do not have a backup fund when an emergency hits you, you’ll be forced to sell part or all of your bitcoin to offset it. This makes all your efforts to invest a waste and brings you back to square one. That’s also you being over aggressive beyond your means which is not an advisable strategy.

[cyberninja2]

The purpose of the discretionary income isn’t just to invest, it is from this money you build your backup funds that’s your emergency and reserve funds. It’s also from this money you take yourself out for a treat, gamble, buy gifts etc…

Now If you put all your discretionary money into bitcoin and you do not have a backup fund when an emergency hits you, you’ll be forced to sell part or all of your bitcoin to offset it. This makes all your efforts to invest a waste and brings you back to square one. That’s also you being over aggressive beyond your means which is not an advisable strategy.

I believe a good investor isn't one who focuses solely on profits and, conversely, doesn't have to worry about losses. Therefore, we need to balance our reserve funds or emergency funds with the goal of providing a cushion for when circumstances don't go as we intended. Having a balance will make our investments safer. The purpose of investing is not only to enrich ourselves but also to ensure that our finances are strong enough to build our portfolio for the future. If we achieve more than we expected, it will be a bonus for us because we have protected our finances well for the future.