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It's better to not rush into investing when a person's debt is high, most might miss this but a high debt hanging over a person's head isn't something to carry around while still investing as well, if she debt id much smaller then it's probably not going to be much of a problem, there is also the situation of how quickly the debt can be paid off, if it's a loan to be paid over a short period of time and if it's high enough then paying off that debt should take priority, the debt is being paid with our discretionary income which is also what we need to invest with, if for any reason our discretionary income stops coming in with a huge debt hanging over our heads we might be tempted to sell our bitcoin to pay off the debt amd situations like this should be avoided.
There is something wrong with your angle of assessment since you are proclaiming that high debt is bad, and even though there is some truth in that statement, the more important assessment relates to how much the debt is costing to service.. not just the outstanding amount.
There can also be various tranches of debt that have differing service rates and different amounts that are owed. .and the prioritization in regards to which debt to pay off first should not merely be a factor of how large that piece of debt is, but instead how much is it costing to service the debt, most likely in terms of percentages.. and debts are structured differently, and some debts have penalties for early payment and others do not, some have various high origination fees, yet once the debt is already established the origination fees are no longer at issue since they had already been assessed, so the ongoing servicing of the loan becomes more important.
There are some debts that allow a low monthly payment amount and then a balloon payment at the end of the period, and there are other debts that pay out the principle as it goes so largely the payment amounts are the same and the total of principle and interest is paid down together and slowly goes down to zero during the term of the loan..
If you have a $2k loan with an annualized interest rate of 16% and a $10k loan with an annualized interest rate of 5%, it is way smarter to pay down the higher interest rate one first... so presuming that there is no early payment penalties, then there might be some structuring of the finances to maximize the payments on the higher interest rate loan and to minimize the amount that is being paid on the higher rate loan.. and then once the higher rate loan is off the books, then there can be some refocus to the extent that there is urgency to pay down the remaining loans (with lower interest rates) or not.
A few years back, I had entered into a loan that had an annualized interest rate around 3%, and initially I was thinking that I was going to pay it down quickly to get it off my books, but then after I reconsidered the situation, I decided to pay it as slow as I could.. It was over 5 years, and it is due to be finished in being paid off around October of this year... so I ended up keeping that loan on my books longer than I originally had intended, mostly based on its low annualized interest rate.
A smaller debt that also has a longer pay off timeline is easier to handle,
Again. Presuming that there is no penalty for early payoff, the most important factor is not the pay off timeline, but instead the annual interest rate on the loan (and any other servicing fees that might apply). Of course, if there were to be some kind of an early pay off penalty structured into the loan (such as the total amount owed does not decrease based on early payments), then the early payoff penalty needs to be considered in regards to what to do or how to handle that debt.
you can split your discretionary income, using one part to gradually settle the debt, another part to accumulate bitcoin and another for any other discretionary expenses that might come up.
Of course, it is true that bitcoin can still be accumulated while servicing debts to the extent that there has been a determination that there is enough discretionary income that is available after all of the basic expenses have been accounted for, and yeah, loan servicing is part of basic expenses, since usually it is not a good idea to default on debt - even though there could be some circumstances that defaulting makes the most sense out of the available options.... for example, default might make sense when the amount of debt that is owed is way more than the value of the collateral (in a collateral based loan) or even in a business situation, there could even be an agreement that one of the partners walk away and leave the whole business to the other partner and the one who is walking away does not owe any further debt servicing obligations, the acquiring partner will agree to take care of everything and relieve the walking away partner of his obligations, but he loses all financial interest in the business.
Guys have various ways that they had gotten into debt, and sometimes they receive money from family and/or friends that might not have onerous terms, and sometimes family and friend relations can be broken due to money arrangements and decisions of one member to not payback his loan and/or not to communicate in regards to his future actions (such as servicing) in regards to the loan. Usually it is not a good idea to fuck over family and/or friends, yet guys have to figure out their own circumstances in terms of how they might deal with such situations in which even the agreements might not really be very clear in regards to whether the money was a loan or a gift or maybe the money was payment for prior service. I recall one arrangement that I had with a friend regarding a plane ticket, and the friend bought the plane ticket and I reimbursed something like half of the price of the plane ticket, so there was a bit of a dispute in regards to our agreement on the costs, and sometimes it might not be easy to resolve and we might not even want to further negotiate if we think that we had satisfied the situation, even if the friend (or family member, or business partner) might not agree to the resolution that we had considered to be a fair resolution, if it relates to our payment of our fair share of a debt. There could be other arrangements in which costs might be shared for dinner and drinks, or maybe one person pays on one occasion, then the next time it is the next person's turn to pay, which could be considered a form of debt, and then sometimes the person does not pay on the next time.. which can cause resentment and/or disputes about perceptions of outstanding debts.
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waiting game have
never been a good strategy because it will definitely cause loose of good opportunities of stacking more bitcoin into your portfolio,
I don't like the use of "never" as a descriptor, since each of us has to figure out the circumstances and how much we are able to invest into bitcoin at any particular time, so there may be circumstances in which discretionary funds are available, yet at the same time questions about whether the discretionary funds are enough based on upcoming concerns about potentially lower income and/or higher expenses. There also could be some concerns about some aspect of bitcoin or from where it is being sourced or how it is being held that causes some concerns about whether that matter (or that uncertainty) has to be resolved prior to putting additional or any money into bitcoin, and surely some of the instances of uncertainty or uncomfortableness may relate more to a matter of size rather than whether to invest into bitcoin, so I had frequently used the example of a person who had already determined that he can clearly invest $100 per week into bitcoin without any stress upon his cashflow situation, yet he may well purposefully reduce his weekly investment size down to $30 based on some various uncertainties or uncomfortableness that he feels that he needs to resolve prior to his feeling sufficiently comfortable to raise the weekly amount beyond $30.
So there can be questions of both amounts and there can be questions in terms of whether to invest (yes or no?), and guys have to come to those resolutions on their own, and frequently my own suggestion is both getting started and continuing to invest into bitcoin on a weekly basis, yet each guy has to figure out for himself whether he is going to get started at all and then also even if he does decide to get started he may well choose an amount that others consider to be very whimpy and/or even a waste of time based on the amount of discretionary income that he has available... such as a guy who already owns a lot of assets (perhaps $100s of thousands of dollars in value?), and he has decent cashflow (perhaps thousands of dollars per month of discretionary income?) and back up funds (that amount to way more than 6 months of his expenses), yet he still decides to start his bitcoin investment with $20 per week rather than starting with higher amounts that he could truly afford without any stress upon his lifestyle or other investments.
Bitcoin has been long tested and trusted most reliable above all coin which has also be rewarding long time hodlers but due to the volatility of bitcoin we are not meant to put all our money in bitcoin but only our discretionary income which is the one lift over after we might have resolved all other important needs, the reason to use your discretionary income is because of it volatile nature and not a guarantee of profit so using money that isn't your discretionary income is a dangerous move.
Volatility is not only the reason why you don't need to put all your money into investing in Bitcoin. Normally, the standard approach for any investment is to invest what you can afford, and it is not a matter of volatility; it is because outside of investments, there are other things you need to do with money, and you cannot neglect the basic things for which money is needed.
Volatility is a reason why one needs to invest consistently or accumulate Bitcoin more, and volatility should not be a reason to slow your investment or reduce the amount that is supposed to be invested.
If a newbie to bitcoin knows enough about bitcoin (by looking at a chart showing its price history), he may well easily be able to conclude (perhaps within 5-10 minutes looking at such price history) that bitcoin has had a very volatile price history, and that it is quite likely that bitcoin is going to continue to have volatile price moves into the future. Accordingly, he can adjust his bitcoin position size (the amount that he is going to put into bitcoin each week or whatever is his buying period) in order to account for his assessment of likely and inevitable future volatility.... and he does not even need to conclude with any precision what his beliefs are in regards to which way the future volatility would resolve and/or how long it might last.. and even at the same time, he (as a newbie) is already deciding to invest into bitcoin what he able to lose.. so he realizes that he could lose up to 100% of the amount that he had put into bitcoin or that he might put into bitcoin in future weeks of his buying bitcoin each week.
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3. Lump sum+ Buy the dip: it just a strategy where an investor put all his funds into a down trends. Like instead of investing gently and accumulating we instead go in fully.
For instance: an investor has $500 so in DCA we can invest little by little for some months or weeks gradually but with Lump sum we just accumulate our pair with the $500 at once and hope for success outcome.
You seem a wee bit confused about lump sum and buying the dip.
Those are two differing approaches to bitcoin buying, so they should be considered separately rather than your mixing them together and convoluting the ideas.
If you have money and you are golding it back in order to buy the dip that is different from someone who either receives money as a lump sum or generates some money that might be considered a lump sum.
Once a lump sum is available, and if there has been a determination to use that lump sum to buy bitcoin, then that lump sum amount could be considered within any of the three categories of 1) buy right away, 2) DCA (which is defer based on time) and/or 3) buy on dips (which is defer based on price, which drop in price might not happen).
Of course there can be situations in which any of the three bitcoin buying strategies can be considered separately or they could be combined, yet each of the strategies has its differing characteristics that might have advantages and/or disadvantages in terms of applying them, depending on the context.
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My standard for a long term Bitcoin accumulation investment should be from/within 6-8 years time-span to reach towards maturity of your Bitcoin accumulation.
Are you talking about yourself? or someone else?
Many folks will not even be able to accumulate enough bitcoin in 6-8 years, unless they might be able to invest more than 10% of their income into bitcoin and/or maybe they are able to front load their investment... and so I am not sure how you can proclaim that 6-8 years could be a standard for normal people, unless there are some special circumstances that might be available to what you consider to be a "standard" group.
Another thing is what do you plan to do after 6-8 years? You planning to sell your bitcoin at that point or doing something else?
By the way, I do understand why you might have a range rather than a specific date, and in your own situation, have you already started in your timeline since you have been registered here on the forum for a bit more than a year. Has anything that has happened with you and/or bitcoin (during your time being involved with it) changed your expectations of bitcoin or how bitcoin might relate to you and/or within a "standard" expectation of how any normie might approach bitcoin from here on out?
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Bitcon also involves risks, and the DCA reduces risk which is why it is encouraged to invest gradually, if you believe it future can be better than where we are now.
DCA does not reduce all risk in bitcoin. It only reduces the risk related to how much a person chooses to put into bitcoin, so if a person has discretionary income and they decide how much to invest from their discretionary income, then DCA provides a vehicle in which a person can measure from within his discretionary income about how much that he wants to put into bitcoin without taking away from his ability to pay his expenses and/or his abilities to build up back up funds. So every week (or whatever is the buying of bitcoin timeline) there can be determinations of how much to put into bitcoin within an amount that is willing to be lost.
Bitcon also involves risks, and the DCA reduces risk which is why it is encouraged to invest gradually, if you believe it future can be better than where we are now.
DCA is an accumulation strategy that enables a low income earner to grow his bitcoin portfolio overtime with his little amount of discretionary income to a size that he wouldn't have been able to accumulate at once because it
gives you the opportunity to buy bitcoin at various price levels.
I doubt that any normal person gives any shits about being able to buy bitcoin at various price levels, since any normal person who has any kind of choice and/or ability to predict the future, he would prefer to buy bitcoin at the cheapest possible price. That way he gets more bitcoin for the same amount of dollars that are used to buy it.
The actual situation is that at any particular snapshot time that a guy is deciding whether or not to buy bitcoin (or how much to spend to buy bitcoin), no one has any clue about which way the bitcoin price is going to go from that point of time and into the future, so he resolves the situation by buying bitcoin within a system that he had established for himself which likely some form of DCA would help him to figure out how much he would like to spend to buy bitcoin at any particular point in time within the parameters of his own chosen level of aggressiveness (or whimpiness) based on the discretionary funds that he then has available.
He would sure the fuck prefer to buy at a lower price, but the price is what it is at the time that he makes the purchase, and perhaps every week (or whatever might be his time period) he does the exact same thing to determine how much he is going to buy (and yeah, maybe he has some automated systems set up and/or some standard amounts, so that he does not have to go through extensive deliberation each week about how much exactly he is going to buy in that particular week.. and he perhaps kind of banks on the fact that with the passage of a lot of time and his ongoing weekly buys of bitcoin, those ongoing and persistent buys had ended up contributing to his having had been able to accumulate way more bitcoin than he would have had otherwise been able to accumulate if he had been fucking around trying to figure out if the price is good, bad or otherwise, so even if he might have had not satisfied his preference to buy bitcoin at the cheapest price possible (which is nearly an impossible goal and perhaps a self-defeating goal), he still ended up accumulating a shit ton of bitcoin that ended up being way larger than his imagination from earlier times.
So, let's not continue to fool ourselves with expectations that we want to buy bitcoin at higher prices (or a "variety of prices"), since we do not, yet at any particular point in time, we have no ability to have any kind of clue about what the bitcoin price is going to be at any point in the future, even if we have hunches and theories about bitcoin's possible price direction, we are likely way better off to be ongoingly, persistently, consistently, regularly and even perhaps aggressively buying bitcoin rather than trying to strategize around price expectations that may or may not end up happening.
However, I don't think that DCA reduces the risk in bitcoin investment.
Oh? So now you are changing your mind, which is fine, but it is not a clear way to write, even though maybe you understood that DCA has the potential to reduce risk in regards to bitcoin in some ways but not in all ways.. which is a fair conclusion that may have had been more clear if you had said that from the start rather than saying one thing and then saying another thing later in the same write-up.
Investing in a long-term with your discretionary income and setting up various backup funds are what reduces the risk attached to bitcoin investment. If you DCA with money that isn't your discretionary income or you did not set up your backup funds as you are investing. You are gambling.
Well, yeah. This part is true. Our cashflow management has the ability to reduce certain kinds of risk related to how much we choose to put into bitcoin and perhaps the extent that we might acknowledge that any amount that we end up putting into bitcoin has chances of going to zero.. so then we put our chosen amount into bitcoin with an acknowledgement that we might not get that money back, as compared to if we used the money right away to buy a bottle of liquor, then we would have the bottle of liquor that we would be able to consume, yet when we put the money into bitcoin for 4-10 years or longer, we might not be able to use it down the road to buy a bottle of liquor or whatever it might be that we might want to use it for in the future.
