Accordingly, a guy could build up his investment holdings while he is earning good money, so that if anything happen to his high paying job, he is still in a good financial situation based on his having had used a good portion of his extra pay to invest into bitcoin rather than consume.. and I am not even against some reasonable levels of consumption, even though sometimes the consumption will go quite a bit overboard with some people... even though surely they have the right to choose what to do with their income..
Sometimes guys might have had gotten into decently well paying positions when they were younger (and even their business might start to earn them good money after they build it for a while), yet when they are older in life, they may find themselves in poverty or even in lower standard of living situations, due to their own failures to sufficiently prepare themselves for later in life when they are no longer ready, willing and able to work and/or maybe their business might have had issues in terms of its profitability changing or diminishing, too.
So, sometimes there can be value to put money into areas that will generate income, yet there is also value in building up investments (such as bitcoin) that are likely able generate income when the guy might not be inclined to do any labor beyond maybe just the accounting aspects of keeping track of his coin balances and/or his spending.
I find it interesting when a young guy is able to think about establishing residual income channels at a young age and not just focused on frivolities just like we've in the gen z's of recent times, it shows maturity and good income management skills on his path and if he does well to invest in his skills, education or even some business while he's having the finances, it's still going to increase his financial status.
Such a person may want to have an asset that would be activated in the future to take care of his later days in case his present buildups fails to last until that moment and that is where most people doing well in their youths fail woefully which makes them end up very poor and miserable when they advance to their older days.
Of course getting a decently paid job is one thing that can frequently be challenging, and all times have their challenge in determining which kinds of work might provide decent income, perhaps some pleasures in doing the work and potential for increases in income and/or promotions. In some sense, young people have a lot going for them based on their age - yet they also might have challenges based on where they are at geographically and perhaps what kinds of skills, experiences and/or connections that they might need to make in order to increase their chance of landing better paying jobs.
So, even if we get into a scenario in which the young person had landed the good paying job, they still may end up screwing up by not taking sufficient measures to invest/save (and these days we consider bitcoin as a good place to carry out the investing portion). I recall that even when I had the poor paying jobs, I had frequently tried to meet the goals of saving/investing at least 10% of my income, which was not always easy, and then there were times in which i had gotten tempted to prematurely tap into the invested/saved funds - so I know part of the problem of getting tempted to tap into available funds rather than continuing to add to them - .. .. so then if I was mostly in the habit of trying to make sure that I put at least 10% of my income into investing/saving, then when my income went up like 6x, then it became easier to increase that amount and the habit that I had already built for myself.
I had various aspects of success - especially when I compare myself to some of my peers who were consuming rather than saving/investing, yet at the same time, I also realize that some of my mistakes were quite short-sighted that included some realizations that I had not noticed the impact of my various mistakes and the mistakes were also along the lines of things that I was told (by the investment books that I was then reading) that I should not be doing, so then when time goes by (such as 10 years or more), the clocks cannot be turned back in order to make up for the mistakes that had been made over the previous 10 years that have already passed.
Bitcoin is a good asset to attempt securing your financial future and it is a good choice for a young person who is earning and has discretionary income to plan for his older days with his investments into it and surely, such a person that just got out from school would have a longer duration ahead of him to hold, so that after a youthful life of work and struggles, you'll spend your later days reaping the fruit of your labour by sustainably withdrawing from your already built holdings to maintain yourself.
Of course there is no way to plan out exactly how everything is going to work out in advance, and we make various choices along the way in regards to what we are going to do in regards to allocating our time, energy and value - and perhaps we attempt to take various safeguards and to learn along the way in terms of if we might need to make adjustments to what we are doing.
So we could have targets that are based on time.. or maybe targets that are based on levels of wealth that might allow us to quit our job or change the kinds of work that we are doing since perhaps our bitcoin (and other investments) had reached a sufficient size that they can either completely support us or alternatively they are able to supplement our income... so surely, we want to end up in a position that is better for our having had invested in bitcoin as compared to if we had not.
A young person can still seek out some kind of security on his investment by having more than one asset invested to like having real estate as a backup asset to his bitcoin holdings which is still fine since our investment into bitcoin isn't guaranteed but the basics is for such a young person to be futuristic minded and build out assets that would take care of him when he can no longer work very actively.
It seems that in the beginning of investing, and perhaps even the first 4- years, there may well need to be focus on ONLY bitcoin and cash, then as those two are growing, then at some point there might be some value in diversifying out, whether it is real estate, stocks, bonds, commodities, cash/cash equivalents, and/or even reasonable business ventures... When to do this and/or how to do it is somewhat individualistic, and when I came to bitcoin in 2013, I had already had a variety of other investments, yet I had built those one by one... and so then if someone is brand new to bitcoin and investing, they may well have question in regards to when it starts to make sense to venture out beyond bitcoin and cash.. perhaps when each of them are 6 months of expenses, or 12 month, or 24 months?.. and sure, once a person's bitcoin and cash might be 3 months of expenses (each), then they might be putting more into bitcoin and merely maintaining the cash or growing the cash slower.. but then it might start seem to make sense at that point to start to put some of that money that would otherwise be in cash in to other investments that do not tend to lose value.. .. so then there remain questions of both liquidity and volatility in regards to any non-bitcoin place that value ends up getting placed.
A young person can still seek out some kind of security on his investment by having more than one asset invested to like having real estate as a backup asset to his bitcoin holdings which is still fine since our investment into bitcoin isn't guaranteed but the basics is for such a young person to be futuristic minded and build out assets that would take care of him when he can no longer work very actively.
It's not a bad idea to diversify when one is exposed to a very high income but just as Bitcoin investment is not guaranteed so is other investments he might want to venture into. Diversification gives an investor better risk control over their investments but doesn't guarantee profits. It's better to invest the money and try to build a better future.
Your response is strange here @Nheer. Personally, I prefer to think about diversification as a means to preserve wealth rather than as a means to make wealth, so in some sense after a person has been building up his bitcoin investment, then he had also been putting money into cash too (which is inferior to bitcoin, even though it serves a purpose, so if the bitcoin and cash are getting to be a lot (especially the cash portion) then diversification can go into some other assets, yet I still don't consider those as ways to make money, even though they are offsetting the bitcoin and the cash, and perhaps are serving similar purposes to cash, but not losing value as much (quickly) as cash.
It's not a bad idea to diversify when one is exposed to a very high income but just as Bitcoin investment is not guaranteed so is other investments he might want to venture into. Diversification gives an investor better risk control over their investments but doesn't guarantee profits. It's better to invest the money and try to build a better future.
Diversification is to preserve the value of your wealth and not to make profits. You can diversify when you have accumulated from half of your bitcoin target and above, if you don't want to put all your funds into bitcoin investment.
However, it's better that you have the knowledge of asset that you want to diversify into before doing so to avoid losses and regrets in future.
There tends to be quite a bit of individual discretion in terms of when diversification might start to seem logical, and I am not sure if it makes sense to wait until the bitcoin stash size gets half to the target amount.. that seems to be allowing a lot of value in bitcoin and ONLY having cash, and is the cash going to be a similar size in such circumstances? Maybe the cash is 10% the size of the bitcoin value? It is difficult to really answer such a question for other guys, depending on their various personal aspects of their income and how long it is taking them to build up their bitcoin stash.
So, hypothetically, maybe a guy is more or less growing the amount he put into bitcoin and his various cash backups at around the same pace, but then once he gets to a point of having 3 months of expenses in each, then he is growing the bitcoin portion faster (greater allocations to the bitcoin portion), yet he still might want to continue to build up his back up funds, but larger his back up funds grow, the more they are losing value (purchasing power), so he might feel that he is not getting anywhere by putting so much money into back up funds that are largely in cash (or cash equivalents.. liquid and not very volatile in terms of how his expenses are denominated). Whether the bitcoin is growing or not in value, it may well start to make sense that the cash, cash equivalents and/or back up funds are growing too large to keep completely in cash.
Just imagine if you had put the equivalent of 1 year or more of your expenses into bitcoin, what quantity would your cash/cash equivalents/back up funds be at that time?
Of course we are going to likely figure out our own personalized ways of valuating our bitcoin holdings and trying to figure if we have enough or not or what is our target, and hopefully we are figuring out ways to make such valuations that are not all over the place (which spot price tends to lure us into). I am not really saying that I know the answer, even though I have the sense that it is not the same for everyone - even though your guidelines are not totally bad - even if they seem a bit high from my perspective.
Yes there should be a form of adjustment when it comes to budgeting and discretionary funds and other plans can be put to use. You just need to be ready in other for you to enjoy your investment because most people don't plan and when you are planning it does not mean it's going to work so let us not be to sure that it's going to work according to plan. But most importantly plan.
What's really needed is what you said. Without a plan we certainly won't be able to do what we need to do regarding adjustments to budgeting and discretionary funds. These two things will always go hand in hand in placing what we should do. So when we enjoy our investments we will certainly find greater comfort in enjoying the results of the investments we have prepared. Although most people don't understand this step because they start something without a priority plan. So when the results don't match expectations I think this is a fundamental mistake that we never evaluate as soon as possible before the risk to each of us occurs.
Whatever you do, there must be some specific plan before it. Suppose you are going to build a house, but you must have a plan, if you do not have a plan, then it is not possible to do anything randomly because to build a house, it is necessary to design it through an engineer, then other work needs to be done, it has to be done step by step and to do this, a plan is definitely needed.
One of the greatnesses of bitcoin is that you don't need all of what you are proclaiming that you need. You can start out with $10, as long as you determined that it is money that you can afford to lose. Sure, no one should be investing in bitcoin or in anything else with intentions to lose the money, yet the point remains that you don't need to have the particulars figured out in order to get started investing in bitcoin.
Another thing that helps to invest into bitcoin (besides having discretionary funds) is having common sense. If a person has common sense, then they are likely capable of learning, planning as they go and also having some ballpark ideas about the general direction that they are intending to go beyond making their initial $100, $10 or whatever it might be for their first purchase. Also, if they have common sense they can figure out how much they can start with and perhaps to adjust the amount that they start with to their comfort level.. and for example, if they generally have an idea that they could afford $100 per week, they might purposefully decide to put in $30 per week while they are working out the various details to help them in the process of becoming more comfortable so that perhaps later down the road they will be able to little by little increase towards investing $100 per week.. or maybe after 10 weeks, they decide to abandon their investment, and over those 10 weeks, they had ended up putting $300 into bitcoin .. and if they determined that the could afford to lose it.. then maybe they get some of that back or maybe not.. but they had already determined that they were putting in as much as they considered that they could afford to lose in the event that they had ended up screwing things up.
Similarly, planning and budgeting are very important in investment,
Bitcoin is not a house... bitcoin allows customization of the amount put in to the comfort level, and the comfort level can change from time to time, whether weekly or some other increment of time that the person might have had chosen to put in his time, energy and money..
because my plan and my ability will depend on it, but my investment. Planning does not only mean one thing, but how much money I will buy, but a complete plan means when I will buy, how to maintain continuity, as well as for how long I will keep this investment.
What you mentioned do not need to be figured out before starting investing into bitcoin. Furthermore, the
9 individual factors and various other individualized related matters, might take years and years and years to figure out the particulars (including that they may well be ongoingly changing), even though to get started investing in bitcoin a bitcoin newbie ONLY needs $10 and perhaps some time that he can dedicate to figuring it out as he goes... and his common sense should help him with all of that. I presume that around 97.5% of people have common sense.. Yet, you seem to be presuming that they don't have it and they need their hands held to protect themselve from themelves?
When I have a specific plan about these, then I will be able to move forward accordingly and it will be easier for me to take subsequent decisions.
Don't you already have some organization in your life at any particular moment? Why can't normie newbie start from where they are at? How much time does it take them to figure out if they have discretionary funds or not? Surely, if a guy hears about bitcoin, isn't such guy going to start by trying to figure out where he is at at the point that he hears about bitcoin and decide if he can get started or not? I think that the main criteria to start is discretionary funds and common sense, and common sense is likely to tell him how much he needs to know before he buys his first $100? or his first $30? or his first $10?
Many people start investing without a plan and even after starting the investment, they do not plan properly, due to which their roadmap does not last long.
Are those people investing? Or maybe you are referring to gamblers?
There is a difference in getting started versus continuing the investment. Surely getting started does not take a plan, yet once a newbie starts, he likely has to plan based on how much he puts in. .. .Let's say that the guy who knows that he can put $100 per week, because that is what he had been investing into some other investments over the past 10 years, so he knows that he has the money that he can divert into bitcoin.. but he decides to start with $30 per week, and he decides that he will figure out the details in 10 weeks because he knows that he has several projects that he is working on.. so in the meantime, he i tentatively planning to put $30 per week in bitcoin until he can look into it later. What is wrong with that? He's an adult. He chose his initial position size, and he determined that he will look into it later, and maybe make his plan later, too. You want to presume that he cannot choose for himself based on a quickie assessment of his situation?
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In some country's context, sometime cannot get a suitable job after completing college. We have to complete our graduation and many people decide to do additional degrees after that because it is very challenging to prove yourself in the job market. The real picture of some poor and developing countries is that even if you have completed higher education, you will not find a job according to your qualifications. You will be forced to apply for employment abroad. Personal decisions may need to be changed depending on the local situation.
You got a good job after completing your graduation. The context of your country may have been favourable as well as the salary increased. I think this is lucky for you. For some people, it may not be enough because they do not get a job of their choice. The socio-economic situation of a country cannot be arranged by the government of that country for educated youth.
Youth is very important for everyone. Those who are aware of this matter should join the job according to their skills only after acquiring the necessary formal education. After completing the formal curriculum, the earning period is very limited because with age you will lose your ability. You will not be able to remember many things and many more physical and mental problems. Youth is the best time to earn and save for the future. If you can make a potential investment like Bitcoin accumulation during this time it will be a great strategy.
It seems that I had already pointed out that there was likely some great fortune in regards to how my own situation had worked out, yet even if a person advance from a situation in which he has very little discretionary income to a situation in which he has larger quantities of discretionary income, he still needs to figure out to invest and how much of his discretionary income that he is going to invest into bitcoin or into other places and/or how much is he going to increase his consumption.
Having a discretionary income is a good problem to have, yet even having a discretionary income does not resolve the matter, including that many of us likely know about folks who have a lot of funds and a lot of options, yet, when they are older they had not engaged in sufficient preparations in spite of their earlier advantageous circumstances.
