JJG’s Outline of Bitcoin Investment Ideas

[Bright0515]

However, DCA may not be feasible on a scheduled basis for those without a steady income. Since they can’t buy on a scheduled basis.

For the fact that using DCA method to invest in Bitcoin is flexible, you can as well invest at anytime you have soare money which is also known as your discretionary income. The truth is that it must not be fixed, so long as you can buy Bitcoin constantly any time you have spare money you are on the right path. It is not advised to buy Bitcoin with money that's meant for your survival, but the only wrong there is that if you don't constantly DCA whenever you have spare money.

However, for the fact that money doesn't just come out from anywhere, you don't have to put your self in a tight condition by scheduling yourself to buy Bitcoin even when you dint have the money to, buy given yourself such condition you will definitely end up buying Bitcoin with the money that's meant for your survival, like either money for your rent feeding and other important things.

Well from my way of reasoning I believe you just assumed that those set of investors that doesn't have a steady income source are limited from investing into Bitcoin which is wrong because from my own understanding, what matters most is discipline, there are so many people which huge amount of money and they still find it very difficult to accumulate Bitcoin, but there are investors with little amount of money (and not always buy bcause they dint always have they money) but they are still buying and accumulating Bitcoin whenever they have spare money and that's because they are discipline.

As for beginners, they really need to start buying Bitcoin gradually because the only thing that have is the basic knowledge but if they start accumulating Bitcoin gradually gradually they will understand the market probably, besides starting small is good because waiting for fixed amount will only delay if you don't have it yet,

[Nheer]

You are absolutely right that in investing, it is not enough to have a fixed income or stable income, but it is more important to have discretionary income or surplus money after meeting all necessary expenses. A person may have a fixed monthly salary or business income but if his living expenses are equal to or more than that income it is impossible for him to invest consistently. The DCA strategy works only when a person can accumulate a certain amount of money without worrying about market conditions for a long time. If there is no surplus money, then the investment may have to be stopped during a market decline which defeats the main purpose of this strategy.

You've got a point that discretionary income is the most important thing and it is quite possible to have an income which is barely enough to cover your expenses but in such situations a person who seriously wants to invest will either learn to manage his income properly by setting priorities to create discretionary income or will have to look for other sources of income to make extra money to be able to invest. Do not force investment when you don't have discretionary income yet until you do.
DCA doesn't necessarily have to be on a weekly or monthly basis or a fixed basis but investing consistently whenever you have discretionary income is also DCA.

As we all know, if we invest into Bitcoin with our survival money there will eventually be a moment whereby we will stat feeling so emotional mostly when the market is going down, but truth be told that if we do it responsibly through our discretionary income we won't feel emotional at all.

However, it's obvious that any investor that has long term plans and is also using the DCA'ing strategy to buy Bitcoin through his discretionary income already know what they are doing, only those set of investors without common sense will invest all their money in Bitcoin, why I said that is because if they have they won't start buying Bitcoin with money ment for their survival. The reason why it's not good to buy Bitcoin with your survival money is because at any moment the market might go down and you will probably feel emotional and it might also trigger you to sell, or if an emergency happens you will be forced to sell your Bitcoin to sort them out.
From what I have seen so far, those investors that sell their Bitcoin when the price start going down, sell their Bitcoin because they have no other choice as they invest outside their discretionary income.

Beyond feeling emotional, you will definitely have to survive and when it is time to utilize that funds for your expenses, you would have no other option than to survive on your portfolio and this is a very bad approach to investing and such an investment becomes gambling.

Bitcoin investment is supposed to be for a long-term and you cannot achieve holding for 4-10 years of longer by investing with funds meant for survival neither can you remain consistent in it, discretionary funds is essential because you would not necessarily be needing those funds anytime soon, so you have more ability to remain consistent and hold such funds invested into bitcoin for longer, so if the person does not have discretionary income, he should not invest yet, but workaround his finances until he is able to identify with having one.

It is also recommended to build out your backup funds alongside buying bitcoin so that you have financial cushions to respond to emergencies and other responsibilities that are not part of your immediate expenses without having to tamper with our holdings.

You're absolutely right, being able to remain consistent to your long term investment plan requires stability outside your investment itself and to do that you need to fix your finances to support your investment through out the time. Long term investors must make sure to invest with discretionary income so their daily life won't have to be dependent on the investment and also build back up funds to support and prevent any unexpected expenses to affect their investment. In reality, most people who fail at long-term investing fail because of poor financial structure.

[Grace333]

I get what you’re saying, and honestly, you’re not far off, you’re just mixing two different layers of risk. Looking at from an investor’s point of view, DCA doesn’t remove risk, it manages entry risk. It spreads your buying over time so you’re not exposed to bad timing. That’s all it does nothing more, nothing less.

You literally just quoted a ton of persons whom you're not even referring to. This makes your point looks a bit directionless since we don't know who you're replying to, and when you do this everone whose name is on that post will definitely receive a mention. I advice you learn how to edit quotes, you can simply remove every other points or post you're not referring to on your write up page so it looks like when you quoting a single person.

The real risk in Bitcoin isn’t just when you buy, it is whether you can survive volatility without panic-selling. That is  where your point about discretionary income and backup funds becomes the real foundation. If those are not in place, even the “perfect” DCA strategy can still break you emotionally or financially.

I'll  like you to understand that bitcoin is not a shitcoins or a shit project where they encounter a small dip and that might be the last action of their hype, you not being able to survive volatility isn't a risk of bitcoin it's just an attitude of a trader or an indiscipline person. Risk in bitcoin has to do with the fact that there is no certainty of profitability after long term holding, but the bitcoin we've known so far is emitting characteristics contrary to it risk and that what make it stand out from every other asset. This in fact is also why a lot of critics have disregarded their initial beliefs invest in bitcoin.

[Kryptonite788]

personally i see the buying the dip strategy as a waste of time and for someone whose major strategy is to buy during dips, success will be far fetch for such investor because in this strategy it have the tendency of making you to wait for years without still buying bitcoin all because you are searching and waiting for that your desired dip and you know fully well that bitcoin is highly volatile and the dip may or may not happen as you would desired. how do you intend to remain consistent in buying  bitcoin and hold when your major strategy is to wait until its dip before you can buy bitcoin, there will be no consistency in it because you are not sure of when the dip will happen or not and even if it happens what is the possibility that itvwill fall to that your desired dip to enable you start buying bitcoin and invest. it is advisable that investors especially newbies focus on buying bitcoin regularly with the dca method which will enable them to buy bitcoin at any market price and hold when they have a discretionary income so that they can get to their accumulation target or even over accumulation. the perfect strategy is dca which will promote the consistency needed in the investment.

I get that waiting for the dip is pointless/time wasting and therefore leads to inaction and missed opportunity for bitcoin accumulation but saying the strategy itself is a waste of time is too absolute and it’s not fair to the investors who have actually benefited from buying the dip at one point in their accumulation period.
I don’t condone waiting for the dip because it’s like a fisherman deciding not to cast his net until he sees a perfect school of fish, he will end up standing in the middle of the river for hours or even days without any catch if he’s not careful. But a wise fisherman casts his net consistently without hesitation and is not bothered even if the net catches only few fishes and when he sees the opportunity to catch a larger school of fish, he casts a bigger net.
This same logic applies to long term bitcoin accumulation, buying the dip should be seen as an opportunistic strategy not main strategy especially if you’re a no-coiner.

[Finebone]

Looking at from an investor’s point of view, DCA doesn’t remove risk, it manages entry risk. It spreads your buying over time so you’re not exposed to bad timing. That’s all it does nothing more, nothing less.

I think that you are getting it wrong by your sentiment of dca accumulating strategy. What I think you should know about the dca accumulating strategy is that it makes accumulation of bitcoin easier depending on when your discretionary income is available, and their is no wrong buying time or manages entry risk, as you are saying because it's just an accumulating strategy that makes things easier, but what really mitigate risk in your Bitcoin investment is when it's held for a very long time.

The real risk in Bitcoin isn’t just when you buy, it is whether you can survive volatility without panic-selling. That is  where your point about discretionary income and backup funds becomes the real foundation. If those are not in place, even the “perfect” DCA strategy can still break you emotionally or financially.

The earlier you understand that the dca is just a accumulating strategy that makes accumulation easier, the better.
Volatility is part of the features of Bitcoin, so why would a Bitcoin investors panic over it if he is doing the right thing, by investing with what he can afford to lose?
It's only a problem to those that invested what they can't afford to lose, so it's best to just buy and accumulate through the dca accumulating strategy and let volatility do his thing, because in 10 years time from now, your investment may do very well if you can hold that long.

[SmartCharpa]

Buying in the dip is indeed a waste of time to be p precisely, yet those groups of individuals that called themselves an investors has not comprehend that they are wasting their precious time on the dip, and they only see it as an opportune of gaining more profits in the market, when the eventually buy in the dip. They only misusing the opportunity of buying now and in futures to come they will profits being added, instead of chasing money that within some minutes it vanish to the air.

The bitcoin price is pumping again, we are currently at $79k, and we may witness $80k on the road to $100k soon. Those who think that waiting for the dip is a good idea, what are they still suggesting? Are they going to keep waiting for the dip, watching us enjoying the moment or they will buy last last? It’s only left for the person waiting for the dips decide, otherwise, the market is enough for anyone to choose whether to wait or not.

In addition, tell me why someone has to wait for the dip when you already know the past history of Bitcoin. If you believe in it future, I don’t see any reason why someone will be praying for the market to dip, while other investors are waiting for to see it go above $100k or its last ATH.

[cxtreenal]

Buying in the dip is indeed a waste of time to be p precisely, yet those groups of individuals that called themselves an investors has not comprehend that they are wasting their precious time on the dip, and they only see it as an opportune of gaining more profits in the market, when the eventually buy in the dip. They only misusing the opportunity of buying now and in futures to come they will profits being added, instead of chasing money that within some minutes it vanish to the air.

Waiting to buy only during the decline is definitely a waste of time. But for someone who continues to invest consistently with the DCA method and buys when they see the market falling, it will not be bad or a waste of time at all. These opportunities are like a bonus and each person can take the bonus in a loop depending on their financial situation. But yes, each person has to buy depending on their financial situation.

Many times it is seen that many people take advantage of the bonus and turn their investment into a gamble or throw it into a risk. Seeing the low price of Bitcoin, they become greedy and invest the money they need. An investor should never do this.

In long term Bitcoin investment, investors' misguided stance during price declines or price increases can lead to losses. Some investors wait for the price to drop with available funds, while others continue to accumulate Bitcoin regardless of the price. Smart investors accumulate Bitcoin during every price trend and use discretionary funds to implement long-term plans. They strive to maintain cash flow and consider each time as the best time to buy Bitcoin.

During regular DCAing some investors keep additional funds ready for price declines and do aggressive DCA at that time. I think those investors are right because they should have additional fund flow available to reach the target period of their choice and have the opportunity to get more Bitcoin holdings with a relatively small amount of funds during the decline.

[ZeroVinsonN]

[edited out]

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.

I understand what you are saying, and I agree with you that the interest rate of a loan is very important, it makes more sense that a smaller loan with a high interest rate can end up costing more over time than a bigger loan with a much lower interest rate, so it makes sense to focus on paying off the high interest loan first rather than on which is higher.
But my point is that the total amount of debt still matters too, not just the interest rate, for example, even if someone has a loan with a low interest rate, if the total amount is very large, it can still put a lot of pressure on them, they still have to make regular payments, and that can affect how much money they have left every month If they are paying in installments on a monthly basis, if for any reason something goes wrong that large debt can quickly become a serious problem, even if the interest rate is low, that's why I was saying people shouldn't rush into investing, especially when they already have a lot of debt.
In real life, things don't always go as planned, if someone is investing while also trying to settle their debts, and their back up fund isn't capable of handling things if their income stops or reduces, they might be forced to sell their investment just to keep up with paying their debt, that could mean selling at a loss, which puts them in a worse position.
I do agree with you that not all debts are the same, interest rate is a major factor, some low-interest debts can be paid slowly without much problem, but I still believe that before someone starts splitting their discretionary income between paying debt and investing, they should make sure they actually have enough discretionary income left after debt payments are covered, enough for them to still be able to invest with and maybe also handle some other discretionary spendingz.
There might be differences in our views, you are focusing more on efficiency while I am focusing more on safety, and I think that both factors matter.

[Odohu]

I get that waiting for the dip is pointless/time wasting and therefore leads to inaction and missed opportunity for bitcoin accumulation but saying the strategy itself is a waste of time is too absolute and it’s not fair to the investors who have actually benefited from buying the dip at one point in their accumulation period.
I don’t condone waiting for the dip because it’s like a fisherman deciding not to cast his net until he sees a perfect school of fish, he will end up standing in the middle of the river for hours or even days without any catch if he’s not careful. But a wise fisherman casts his net consistently without hesitation and is not bothered even if the net catches only few fishes and when he sees the opportunity to catch a larger school of fish, he casts a bigger net.

We are not discussing justice and democracy in this thread, we are discussing what is best for probably low coiner or new investor and buying the dips is definitely not it. Some experienced investors might have mastered how to use it to achieve their results but the discussion is not about them but by those who have not reach there. JJG made this thread as a guide for people who have not reached their target so it is highly recommended we adopt method that works and not based on probabilities...and as you know, buying the dip does have some probabilities attached which can make someone never invest, missed opportunities and even FOMO. Instead of adopting method that have obvious disadvantage, a continuous accumulation method like the DCA method becomes a favorable option that is suitable for all income classes.

[Joeboy]

Anyone can apply any method in the context of DCA investing especially having discretionary funds is certainly a priority. This is a fundamental requirement for anyone investing whether large or small. However it shouldn't be mandatory. Regardless of the amount DCA investing is nothing new even though the potential risks involved in such an approach sometimes outweigh the potential risks.

And this has become a necessity for them to continue to deal with what will happen when they have finished doing something that does not result in accordance with their wishes but a form of responsibility will always be carried out so that this is a form of someone's limit to continue to carry out responsibility for events or situations that according to other people's assessments we are wrong in anticipating emergency events that make us fail to protect ourselves.

cyberninja2 discretionary income should always be made mandatory and that coz without Discretionary income folks are mist likely to sell out there Bitcoin at a time which may not even be of their own choosing... Without the use of Discretionary income there is a very high chance of folks dipping into their holdings thereby disrupting the longevity of their holdings especially in cases when this unattended basic needs comes up....

The potential risk (like selling out due to financial needs and whatnot), that you seem to be talking about could very well get minimized when folks make their DCA purchases using their discretionary income since discretionary income is the extra money left after the settlement of tour basic needs have been done..

~snip.

I get what you’re saying, and honestly, you’re not far off, you’re just mixing two different layers of risk. Looking at from an investor’s point of view, DCA doesn’t remove risk, it manages entry risk. It spreads your buying over time so you’re not exposed to bad timing. That’s all it does nothing more, nothing less.

The real risk in Bitcoin isn’t just when you buy, it is whether you can survive volatility without panic-selling. That is  where your point about discretionary income and backup funds becomes the real foundation. If those are not in place, even the “perfect” DCA strategy can still break you emotionally or financially.

It's surprising how you guys keep quoting long text, without being specific on who you are addressing your response to...Could you be more specific on who you are responding to..

[Brizi5000]

Buying in the dip is indeed a waste of time to be p precisely, yet those groups of individuals that called themselves an investors has not comprehend that they are wasting their precious time on the dip, and they only see it as an opportune of gaining more profits in the market, when the eventually buy in the dip. They only misusing the opportunity of buying now and in futures to come they will profits being added, instead of chasing money that within some minutes it vanish to the air.

Waiting to buy only during the decline is definitely a waste of time. But for someone who continues to invest consistently with the DCA method and buys when they see the market falling, it will not be bad or a waste of time at all. These opportunities are like a bonus and each person can take the bonus in a loop depending on their financial situation. But yes, each person has to buy depending on their financial situation.

Many times it is seen that many people take advantage of the bonus and turn their investment into a gamble or throw it into a risk. Seeing the low price of Bitcoin, they become greedy and invest the money they need. An investor should never do this.

In long term Bitcoin investment, investors' misguided stance during price declines or price increases can lead to losses. Some investors wait for the price to drop with available funds, while others continue to accumulate Bitcoin regardless of the price. Smart investors accumulate Bitcoin during every price trend and use discretionary funds to implement long-term plans. They strive to maintain cash flow and consider each time as the best time to buy Bitcoin.

During regular DCAing some investors keep additional funds ready for price declines and do aggressive DCA at that time. I think those investors are right because they should have additional fund flow available to reach the target period of their choice and have the opportunity to get more Bitcoin holdings with a relatively small amount of funds during the decline.

Don’t you also think that sometimes it could be problematic for those investors who keep money aside for the purpose of buying dip that they are not sure if it will happen or not and by then this money kept won’t be put into use whereas they could have easily used it to buy persistently or aggressively at every market price to build up their portfolio. And if new is should come with this very mindset of keeping some money aside for the purpose to f buying dips I think it will slow them down in terms of reaching their accumulation target because they are reducing the amount of discretionary income they would have supposed to use for buying bitcoin even more aggressively to reach their accumulation target. They can gradually turn to traders because it will come a time when they will be keeping even more larger amounts of money aside for the dip and using just a minimal amount for their DCA if at all they even continue DCAing again.

[JayJuanGee]

It continues to be problematic for guys to be proclaiming that DCA is a perfect strategy and/or to even be implying that the other strategies should not be considered, even if it is true that DCA has a lot of abilities to be fit to circumstances that apply to almost everyone and anyone as long as they have discretionary funds.

That is obviously true, because there are individuals investing in Bitcoin who might think and suggest that other strategies aren’t good, but personally I have been a huge fan of the DCA and I obviously think that is the perfect investment strategy when you don’t have enough discretionary income and mainly for low income earners, and I have always suggested that if you have the right plans and strategies and you also have the availability of having different cashflow you can actually approach other techniques with the right mindset, I also think everything have to do with availability of discretionary income and when an investor also have the discretionary income to appreciate the other techniques.

If you have the money you can always buy bitcoin in bulk and I know there are individuals who are buying bitcoin through the Lump Sum and it’s quite appreciative of them to be buying through the Lump Sum’s techniques and also I have also seen people who keeps some money aside specifically for buying the dip and it’s widely appreciated by them when the opportunity presents itself.

So personally I feel all techniques are okay depending your approach with different techniques.

I have problems with proclamations that something is "perfect," and yeah, you conditioned your assertion that DCA is perfect based on a scenario in which some investors might not have a lot of money to work with so they are dealing with figuring out how much to invest in bitcoin and perhaps the amount of discretionary funds are quite small and they struggle to get the discretionary income to go up by either trying to increase their income and/or to decrease some of their expenses.

So, surely, I will also proclaim that DCA works quite well to attempt to deal with circumstances in which guys do not have very much money to deal with, and perhaps if they spend years and years in such struggles with their income/expenses (their discretionary fund amounts), then they might not have too many opportunities in which they might have more funds come available and they are put into a situation where they are able to decide how to use the money.

Sometimes it helps to work with examples.  Let's say that we have a person who has an income that is about $9k per year - so about $750 per month.,. and maybe it varies, yet for the sake of this example, we are going to use averages in order to make our description easier.  Let's say that the basic expenses are right around $500 per month, and so there is only right around $250 remaining to work with for discretionary funds (which largely adds up to right around $60 per week - since there are 4.33 weeks per month).  And so really, the person had been investing into bitcoin and also building up back up funds within a system for right around 2 years, and putting $20 per week into bitcoin, $20 per week into back up funds and $20 per week into discretionary spending...so after 2 years, they have right around $2k into bitcoin, $2k into back up funds (in this example that would be 4 months of their expenses) and they had discretionarily spent right around $2k.

And, yeah, maybe my example is showing too much ongoing progress, since in the real world, we know that people who live on the edge may well have ebbs and flows.  They will have periods of none (or almost no income) and also periods in which expenses go up... So, I am smoothing out the example to make it easier to present... ... yet we could have examples that even poor people might end up coming accross some fortune.. and let's say all of a sudden, this poor person receives some extra funds that add up to right around $2k.  What are they going to do with the $2k?  That $2k equals 2 years of the amount that they had put into bitcoin.  Tell me @Alonso_ (or anyone else)  What are they going to do with the extra $2k that they suddenly (and unexpectedly received)? That receipt of an extra $2k without knowing in advance is truly the definition of receiving a lump sum, so such person has options in regards to what they are going to do with that extra money, right?

Of course, the answer about "what to do?" might not ONLY be bitcoin, since it could well be the case that the person could use the money to receive some kind of a job promotion, if they know of some way to spend the money to get training (or something like that) that would lead them towards improving their discretionary income, and yeah, sometimes the better of the choices might be to put it into bitcoin, yet it can be quite difficult to know in the abstract, even though individuals will have their particular skills and/or connections and/or the things that they might be working on and even awareness of a certain amount of money that they might need in order to enter into some kind of a venture or training in which the venture/training could improve their income (and they might be wrong about those ideas too and they might have had not sufficiently calculated the costs versus the benefits).

Buying in the dip is indeed a waste of time to be p precisely, yet those groups of individuals that called themselves an investors has not comprehend that they are wasting their precious time on the dip, and they only see it as an opportune of gaining more profits in the market, when the eventually buy in the dip. They only misusing the opportunity of buying now and in futures to come they will profits being added, instead of chasing money that within some minutes it vanish to the air.

Many times it is seen that many people take advantage of the bonus and turn their investment into a gamble or throw it into a risk. Seeing the low price of Bitcoin, they become greedy and invest the money they need. An investor should never do this.

Any investor that behaves in such a manner is heading for destruction because he can’t sustain it. That’s why it is very important for investors to plan themselves ahead of time when and make plans. That’s why it’s always good for investors to have backup funds so that when the market present such an unexpected opportunity, the investor will have the backup funds available to turn to. If you don’t have backup funds to buy sudden market dips, continue with your dca.

This is the point that many folks frequently make about the preferability of DCA.  They are not necessarily holding back any money to buy dips... They are buying every week, so if a dip comes, they do not have extra money to buy dips beyond their regular DCA amount... so don't be trying to act like money just comes available in some fantasy way, since it does not. There are trade-offs in terms of holding back money to buy the dip...and the dips may or may not happen.. and it may well would have had been better to just stay focused on ongoingly buying bitcoin every week.. and perhaps trying to figure out if their might be any ways that discretionary funds can be increased by increasing the income and/or cutting expenses.

[edited out]

I get what you’re saying, and honestly, you’re not far off, you’re just mixing two different layers of risk. Looking at from an investor’s point of view, DCA doesn’t remove risk, it manages entry risk. It spreads your buying over time so you’re not exposed to bad timing. That’s all it does nothing more, nothing less.

You are overly simplifying and seeming to claim you know everything when you make such closed and conclusive statements to suggest that you have summed up everything that DCA does, and there is still something wrong with what you have captured in your summary of DCA, since DCA allows each person to decide how much of his discretionary income he is going to put into bitcoin each week within the level of his aggressiveness (or whimpiness) preference, so there could be some weeks that he chooses to be more aggressive than others, and there could be some weeks that he chooses to add to his back up funds or to take away from his back up funds and put some of that into bitcoin, and those decisions about level of aggressiveness or even perhaps sometimes spending beyond his discretionary funds (with reliance on his back up funds covering the changes in his aggressiveness) might still end up putting him at risk.. whether he knowingly chose the increases of risk or not..

Part of my point is that guys still have abilities to choose within how they employ DCA, and even the extent to which they might supplement DCA with lump sum from time to time, and they might not even realize the extent to which they are making trade offs with their chosen strategies... since even with DCA, there can be some preference to use money to invest into bitcoin as soon as it comes available, yet there could be times that guys want to defer some of their DCA investments based on too much money coming available at once, and those could be described as two forms of DCA.. and in that regard, let's say that a guy generally buys $100 of bitcoin every week, and some weeks he has $50 available and other weeks he has $200 available, yet he keeps enough money in a side fund so that he can smooth out the amounts and invest $100 per week in almost any of the changes in his cashflow that might happen from week to week, yet there could play out a situation in which the extra amount of his discretionary funds ends up being $1k for a given week, and so that amount is way higher than he usually has available, so then he might be faced with a bit of a dilemma regarding how much BTC to buy right away, how much to maybe defer into coming weeks, and then maybe since he has an extra amount, he might be tempted to hold back some of the money for buying potential dips..

So if we assume the guy already has good cashflow management in place (and his back up funds are in good order, already), so then, maybe the guy with the extra $1k decides that for the next 10 weeks, he is going to increase his DCA from $100 per week to $200 per week, and maybe that is not a good idea, since there are other options that he could just use half of $1k to buy right away or maybe he could divide the $1k into 3 parts and put $333 for DCA, $333 for lump sum buying right away and $333 for buying dips that may or may not end up happening.

The real risk in Bitcoin isn’t just when you buy, it is whether you can survive volatility without panic-selling.

You think so?  Doesn't the combination of your cashflow management and your decided level of aggressiveness in your bitcoin buying help with whether you panic?  And, then if you are in bitcoin for a while, there could be some value in forcing yourself to buy bitcoin every week no matter what, so then at that point, you have created a mindset and a practice for yourself of buying no matter what, so that selling is not even "on the menu" of things to do.  Why would a guy go from ongoing buying every week to selling, unless he is not managing his money enough and maybe he had chosen to invest more aggressively than he was prepared to do, then when the price drops, he falls out of his practice of ongoing buying every week.

That is  where your point about discretionary income and backup funds becomes the real foundation. If those are not in place, even the “perfect” DCA strategy can still break you emotionally or financially.

Several guys participating in these DCA discussions talk about how putting strong finances in place, then the psychology will likely become stronger from having had put strong financial practices in place.  Of course, some guys are more prone to panic than others, yet if they invest in bitcoin for long enough and they practice, then they likely can figure out ways to account for their own inclinations to panic and attempt to put individually tailored practices into place for themselves in order to lessen the odds that they will panic under certain circumstances that would otherwise be scary for them.. and surely some guys are better off to purposefully not put as much money into bitcoin so that they can make sure that they are psychologically prepared for the downward volatility, even though sometimes they might also be feeling regret when the price ends up going up, and then they end up feeling that they had not been aggressive enough in their buying.. so it can frequently be difficult to find a good balance for any of us and many times we will feel regret even when we might have systems in place in which we believe that we are striking a sufficiently "good enough" balance and realizing that there aren't any real ways to perfect what we are doing.

[edited out]

I understand what you are saying, and I agree with you that the interest rate of a loan is very important, it makes more sense that a smaller loan with a high interest rate can end up costing more over time than a bigger loan with a much lower interest rate, so it makes sense to focus on paying off the high interest loan first rather than on which is higher.
But my point is that the total amount of debt still matters too, not just the interest rate, for example, even if someone has a loan with a low interest rate, if the total amount is very large, it can still put a lot of pressure on them, they still have to make regular payments, and that can affect how much money they have left every month If they are paying in installments on a monthly basis, if for any reason something goes wrong that large debt can quickly become a serious problem, even if the interest rate is low, that's why I was saying people shouldn't rush into investing, especially when they already have a lot of debt.
In real life, things don't always go as planned, if someone is investing while also trying to settle their debts, and their back up fund isn't capable of handling things if their income stops or reduces, they might be forced to sell their investment just to keep up with paying their debt, that could mean selling at a loss, which puts them in a worse position.

For sure, each person has to figure out how to deal with their financial situation and the extent to which they can start to invest into bitcoin from where they are at and if the debt looming over their head might need to be dealt with first, and surely some guys might not have had realistically assessed the risks that might exist within the amount of debt that they had already ended up building up.. and perhaps their having had accumulated so much debt also shows that they have some of their own problematic personality issues in that they might not either be able to control their wants and/or to properly measure how they are going to deal with them into the future.

So we might consider the possibility that guys who had got themselves into such a position might have some issues to improve their own cashflow management practices and their distinguishing between wants and needs.. and there could be guys who might realize, once they really assess the situation, that they need to take some drastic moves to lower their absolute level of debt - even though there could be ways to deal with the debt and to invest into bitcoin at the same time, depending on the severity of the matter and even the extent to which back up funds are in place (as you mentioned).  A guy who has such outstanding debt, he likely should be engaging in a practice to keep higher levels of back up funds and also trying to figure out ways to increase his discretionary income by increasing his income and/or cutting his expenses.

I do agree with you that not all debts are the same, interest rate is a major factor, some low-interest debts can be paid slowly without much problem, but I still believe that before someone starts splitting their discretionary income between paying debt and investing, they should make sure they actually have enough discretionary income left after debt payments are covered, enough for them to still be able to invest with and maybe also handle some other discretionary spendingz.
There might be differences in our views, you are focusing more on efficiency while I am focusing more on safety, and I think that both factors matter.

Sure.  Both factors need to be accounted, yet some of the same methodologies can be used to determine how the guy proceeds and to figure out the difference between his income and his expenses (with loan servicing being one of the expenses), and so then once he has figured out his discretionary funds, then he can figure out how much money he already has in place as back up funds in order to figure out if he is in a position with his discretionary funds (to the extent that he has any) to invest, build his back up funds and/or discretionarily consume... and how much to allocate to each category. If he is in a position in which he has no discretionary funds or that his finances are such a mess that he is not really able to figure out the extent to which he has discretionary funds, then he likely would need to hold off investing in bitcoin until he can assure that he has discretionary funds.. and yeah, by the way, if he figures out that he has some credit that has 3% rates, other credit that is 12% and other credit that is 23%, then he likely needs to at least take care of the 23% credit, since that is an instant and guaranteed return of 23% and will take a lot of burden off of his expenses to get those high interest rate loans down to zero.. and there might be more of a dilemma regarding how fast to pay off the 12%, and I would not be in a hurry to pay of the 3% rate pieces.

[edited out]

.... JJG made this thread as a guide for people who have not reached their target so it is highly recommended we adopt method that works and not based on probabilities...

I made this for everyone, even though surely it seems that an overwhelming majority of folks take a long time to get through their accumulation phase of investment into bitcoin, so surely we frequently talk about both accumulation of bitcoin and cashflow management systems/practices that hopefully help each of us to make progress towards ongoingly building up of our bitcoin holdings and even strengthen our finances and psychology overall with both a combination of the building of the bitcoin holdings and the strengthening of the cashflow management practices/systems.

Of course, we could also progress out of our accumulation phase into maintenance and/or even discussions of sustainable withdrawal that might end up even being relevant for guys who had not quite made it there yet... but either anticipating what might be done once arriving at sustainable withdrawal or even figuring out how to measure the approach or the arrival of overaccumulation status that might later start to justify the employment of sustainable withdraw practice (price-based and/or time-based sustainable withdrawal practices).

and as you know, buying the dip does have some probabilities attached which can make someone never invest, missed opportunities and even FOMO. Instead of adopting method that have obvious disadvantage, a continuous accumulation method like the DCA method becomes a favorable option that is suitable for all income classes.

For sure DCA does tend to be a preferable strategy since it is so widely applicable, and even good for supplementing other strategies to the extent that other strategies might sometimes seem to have some potential applicability.. and you are right, @Odohu, some guys might sometimes get distracted by price and/or anticipations of future BTC price moves that might end up working against their own better interest to be ongoingly, persistently, regularly, consistently and perhaps even aggressively accumulating bitcoin, especially in their earliest years of bitcoin accumulation where they still might be balancing how aggressive they are able to be based on their also making sure that their back up funds are sufficiently adequate to address any mistakes that they might make (that might relate to short term cashflows or even cashflows into the future) or even unexpected fluctuations that any of us can end up having in regards to our income and/or our expenses.

[samadam007]

I get that waiting for the dip is pointless/time wasting and therefore leads to inaction and missed opportunity for bitcoin accumulation but saying the strategy itself is a waste of time is too absolute and it’s not fair to the investors who have actually benefited from buying the dip at one point in their accumulation period.
I don’t condone waiting for the dip because it’s like a fisherman deciding not to cast his net until he sees a perfect school of fish, he will end up standing in the middle of the river for hours or even days without any catch if he’s not careful. But a wise fisherman casts his net consistently without hesitation and is not bothered even if the net catches only few fishes and when he sees the opportunity to catch a larger school of fish, he casts a bigger net.

We are not discussing justice and democracy in this thread, we are discussing what is best for probably low coiner or new investor and buying the dips is definitely not it. Some experienced investors might have mastered how to use it to achieve their results but the discussion is not about them but by those who have not reach there. JJG made this thread as a guide for people who have not reached their target so it is highly recommended we adopt method that works and not based on probabilities...and as you know, buying the dip does have some probabilities attached which can make someone never invest, missed opportunities and even FOMO. Instead of adopting method that have obvious disadvantage, a continuous accumulation method like the DCA method becomes a favorable option that is suitable for all income classes.

Exactly. For new investors and low coiners trying to buy the dip often leads to waiting forever or buying at the wrong time. DCA is the safest and most realistic way to build steadily without stress. Just invest a fixed amount regularly and focus on consistency. That’s how most of us actually grow.

[Silikiem]

I get that waiting for the dip is pointless/time wasting and therefore leads to inaction and missed opportunity for bitcoin accumulation but saying the strategy itself is a waste of time is too absolute and it’s not fair to the investors who have actually benefited from buying the dip at one point in their accumulation period.
I don’t condone waiting for the dip because it’s like a fisherman deciding not to cast his net until he sees a perfect school of fish, he will end up standing in the middle of the river for hours or even days without any catch if he’s not careful. But a wise fisherman casts his net consistently without hesitation and is not bothered even if the net catches only few fishes and when he sees the opportunity to catch a larger school of fish, he casts a bigger net.

We are not discussing justice and democracy in this thread, we are discussing what is best for probably low coiner or new investor and buying the dips is definitely not it. Some experienced investors might have mastered how to use it to achieve their results but the discussion is not about them but by those who have not reach there. JJG made this thread as a guide for people who have not reached their target so it is highly recommended we adopt method that works and not based on probabilities...and as you know, buying the dip does have some probabilities attached which can make someone never invest, missed opportunities and even FOMO. Instead of adopting method that have obvious disadvantage, a continuous accumulation method like the DCA method becomes a favorable option that is suitable for all income classes.

Exactly. For new investors and low coiners trying to buy the dip often leads to waiting forever or buying at the wrong time. DCA is the safest and most realistic way to build steadily without stress. Just invest a fixed amount regularly and focus on consistency. That’s how most of us actually grow.

Just a discretionary income is enough to use for your regular buying of bitcoin with the DCA method. The amount must not be a fixed amount as sometimes there could be discrepancies in our available discretionary income which comes after we might have finished sorting out our basic financial expenses or needs. So what you just need for regular buying of bitcoin is a discretionary income which must not be a fixed amount.

[The Founding Titan]

I get that waiting for the dip is pointless/time wasting and therefore leads to inaction and missed opportunity for bitcoin accumulation but saying the strategy itself is a waste of time is too absolute and it’s not fair to the investors who have actually benefited from buying the dip at one point in their accumulation period.
I don’t condone waiting for the dip because it’s like a fisherman deciding not to cast his net until he sees a perfect school of fish, he will end up standing in the middle of the river for hours or even days without any catch if he’s not careful. But a wise fisherman casts his net consistently without hesitation and is not bothered even if the net catches only few fishes and when he sees the opportunity to catch a larger school of fish, he casts a bigger net.

We are not discussing justice and democracy in this thread, we are discussing what is best for probably low coiner or new investor and buying the dips is definitely not it. Some experienced investors might have mastered how to use it to achieve their results but the discussion is not about them but by those who have not reach there. JJG made this thread as a guide for people who have not reached their target so it is highly recommended we adopt method that works and not based on probabilities...and as you know, buying the dip does have some probabilities attached which can make someone never invest, missed opportunities and even FOMO. Instead of adopting method that have obvious disadvantage, a continuous accumulation method like the DCA method becomes a favorable option that is suitable for all income classes.

Exactly. For new investors and low coiners trying to buy the dip often leads to waiting forever or buying at the wrong time. DCA is the safest and most realistic way to build steadily without stress. Just invest a fixed amount regularly and focus on consistency. That’s how most of us actually grow.

What matters with the DCA is consistency and even this depends entirely on the availability of your discretionary income, you don't have to invest as fixed amount everytime you DCA, you discretionary income most likely isn't fixed and what you invest from it depends on how much discretionary income you have, you can invest more today and less the next time because your discretionary income shifted, what you should be worried about shouldn't be being able to invest fixed amounts but rather to be able to to push yourself to accumulate consistently with your discretionary income.
Newbies and nocoiners should know this so they don't end up investing beyond the limits of their discretionary income simply because they are trying to continuously invest a fixed amount, an amount their discretionary income sometimes might not be able to cover, only invest within the limits of your discretionary income.

[SmartCharpa]

buying the dip should be seen as an opportunistic strategy not main strategy especially if you’re a no-coiner.

Waiting for the dip shouldn’t be our main strategy, it should be seen as opportunity to buy more when it comes. Sometimes the market doesn’t give another chance, because the current price isn’t what we saw it three years ago, and many people end up missing out opportunity while waiting for the dip. Everything about Bitcoin is consistently than timing the market, just continue building over time, not to consider the market itself.

Just a discretionary income is enough to use for your regular buying of bitcoin with the DCA method. The amount must not be a fixed amount as sometimes there could be discrepancies in our available discretionary income which comes after we might have finished sorting out our basic financial expenses or needs. So what you just need for regular buying of bitcoin is a discretionary income which must not be a fixed amount.

You are right, it is not necessary to have a fixed amount while using the DCA method. Sometimes things might not go the way we expected, the responsibilities we have this month may be more than what we handled last month, so fixing an amount won’t be necessary. Discretionary income is what we use for long term investment, the amount you have left after taking care of other expenses, it’s not use to be done with the money we may need tomorrow.

[whiteblue]

Sometimes we think that investing is a demanding routine because it drains our minds and can make us feel bored.

But that's a big mistake for those who think investing in Bitcoin quickly gets boring, Because Bitcoin has shown better progress than gold, silver, and other assets. Therefore, must be consistent with Bitcoin investments, otherwise, We wasting an opportunity to change our lives for decades to come.

Most investors often don't believe in destiny because they didn't buy Bitcoin in the first place, But now regret it. So, destiny is changing our fate for the better, something they've already wasted. Therefore, We must have faith and buy regularly to accumulate Bitcoin.

[Big Dirams]

Waiting for the dip shouldn’t be our main strategy, it should be seen as opportunity to buy more when it comes. Sometimes the market doesn’t give another chance, because the current price isn’t what we saw it three years ago, and many people end up missing out opportunity while waiting for the dip. Everything about Bitcoin is consistently than timing the market, just continue building over time, not to consider the market itself.

As a smart investor waiting  for dips shouldn’t be what one prioritizes during our investment journey with bitcoin. When we sit back and fold our arms to wait for dips then apparently we are just sitting in dark hoping on a volatile pair to go for dips when such moves isn’t predictable.  Sitting and waiting for dips are just waste of time and it at the same time procrastination so instead of waiting for dips applying DCA helps to make our investments journey much easier.

You are right, it is not necessary to have a fixed amount while using the DCA method. Sometimes things might not go the way we expected, the responsibilities we have this month may be more than what we handled last month, so fixing an amount won’t be necessary. Discretionary income is what we use for long term investment, the amount you have left after taking care of other expenses, it’s not use to be done with the money we may need tomorrow.

Having a fixed amount in mind while using DCA would make no sense at all because with DCA we can accumulate at any time so far we see a positive market moves we can buy so having a fixed amount of discretionary income will just makes us loss out a lot of opportunities from the market and also at the same time it will end our DCA strategy. Like the steady accumulation would stop as soon as our fixed discretionary income finishes so why not just forget about fixed price and focus on the long term growths of our holdings in the future.

[IjawMan]

*

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?

Talking about myself.

Spreading 10% of your income across accumulating it for 6-8 may not be a significant sum total for many folks but there are those that will see it as a something big that was worth the years of accumulation. Not every guy can have sufficient money to front-load his Bitcoin investment in the given time-span, even if they cannot but can remain consistent with their accumulation routine without faulting by missing many times to buy accumulate.

The chosen time of 6-8 years is personal and feasible to accomplish to me, and since Bitcoin investment time plan does not have to be rigid, I can always relax the time-span and extend it where am not satisfied with what has been accumulated in this given years.

[ZeroVinsonN]

[edited out]

I understand what you are saying, and I agree with you that the interest rate of a loan is very important, it makes more sense that a smaller loan with a high interest rate can end up costing more over time than a bigger loan with a much lower interest rate, so it makes sense to focus on paying off the high interest loan first rather than on which is higher.
But my point is that the total amount of debt still matters too, not just the interest rate, for example, even if someone has a loan with a low interest rate, if the total amount is very large, it can still put a lot of pressure on them, they still have to make regular payments, and that can affect how much money they have left every month If they are paying in installments on a monthly basis, if for any reason something goes wrong that large debt can quickly become a serious problem, even if the interest rate is low, that's why I was saying people shouldn't rush into investing, especially when they already have a lot of debt.
In real life, things don't always go as planned, if someone is investing while also trying to settle their debts, and their back up fund isn't capable of handling things if their income stops or reduces, they might be forced to sell their investment just to keep up with paying their debt, that could mean selling at a loss, which puts them in a worse position.

For sure, each person has to figure out how to deal with their financial situation and the extent to which they can start to invest into bitcoin from where they are at and if the debt looming over their head might need to be dealt with first, and surely some guys might not have had realistically assessed the risks that might exist within the amount of debt that they had already ended up building up.. and perhaps their having had accumulated so much debt also shows that they have some of their own problematic personality issues in that they might not either be able to control their wants and/or to properly measure how they are going to deal with them into the future.

It is very likely that they in debt because they lack simple control on their wants and ended up taking loan to indulge themselves, if this is the case I don't see that person making any good improvements on investing in bitcoin, if they can't control what pushes them to take out loans then they probably won't be able to control themselves from taking out of their bitcoin investment if they ever fell the need to indulge themselves again, it's easier to deal with if the loan was taken for something important that could not be avoided like something their backup funds couldn't handle probably because they haven't saved up enough yet, things like this happen.
It might not even be their debt, people inherit more than assets these days and having to pay off a debt you inherited can be a serious drag and depending on how much it's taking from you (the investor) to service they might not be able to accumulate bitcoin at the time (though if they still have discretionary income left over then they can buy, not as much as they would without the debt but it's probably better than nothing) until the debt is settled.

So we might consider the possibility that guys who had got themselves into such a position might have some issues to improve their own cashflow management practices and their distinguishing between wants and needs.. and there could be guys who might realize, once they really assess the situation, that they need to take some drastic moves to lower their absolute level of debt - even though there could be ways to deal with the debt and to invest into bitcoin at the same time, depending on the severity of the matter and even the extent to which back up funds are in place (as you mentioned).  A guy who has such outstanding debt, he likely should be engaging in a practice to keep higher levels of back up funds and also trying to figure out ways to increase his discretionary income by increasing his income and/or cutting his expenses.

If the debt is personal then servicing it would be easier since the debt was expected, if it's to be paid in installments as most loans are then depending on how much they are to pay in the stipulated periods of time they could definitely still accumulate bitcoin, if they are servicing the loan from their discretionary income and it's taking about 70% in installments then they still have about 30% for other things,(although I don't quite believe they will be servicing the loan with their discretionary income, at that point that expense is essential and they can only tell if they have any discretionary income available after paying the loan and paying for other essentials, even though they are still paying in installments) we can't expect them to invest all in bitcoin but they are still in a good position to be able to keep up with their investment while still paying back then loan, and like you said they can get more discretionary income by increasing their income or cutting down on their expenses

I do agree with you that not all debts are the same, interest rate is a major factor, some low-interest debts can be paid slowly without much problem, but I still believe that before someone starts splitting their discretionary income between paying debt and investing, they should make sure they actually have enough discretionary income left after debt payments are covered, enough for them to still be able to invest with and maybe also handle some other discretionary spendingz.
There might be differences in our views, you are focusing more on efficiency while I am focusing more on safety, and I think that both factors matter.

Sure.  Both factors need to be accounted, yet some of the same methodologies can be used to determine how the guy proceeds and to figure out the difference between his income and his expenses (with loan servicing being one of the expenses), and so then once he has figured out his discretionary funds, then he can figure out how much money he already has in place as back up funds in order to figure out if he is in a position with his discretionary funds (to the extent that he has any) to invest, build his back up funds and/or discretionarily consume... and how much to allocate to each category. If he is in a position in which he has no discretionary funds or that his finances are such a mess that he is not really able to figure out the extent to which he has discretionary funds, then he likely would need to hold off investing in bitcoin until he can assure that he has discretionary funds.. and yeah, by the way, if he figures out that he has some credit that has 3% rates, other credit that is 12% and other credit that is 23%, then he likely needs to at least take care of the 23% credit, since that is an instant and guaranteed return of 23% and will take a lot of burden off of his expenses to get those high interest rate loans down to zero.. and there might be more of a dilemma regarding how fast to pay off the 12%, and I would not be in a hurry to pay of the 3% rate pieces.

It's perfectly reasonable to try and settle the loans with higher percentage interest than the ones with lower ones, delay the high interest loans and you will see the interest grow beyond the capital in very little time leading to a situation where they might have already paid off the original loan but the interest isn't going away yes because it just keeps adding, the lower interest loans will be easier to handle and so can be delayed till the high interest ones have all be dealt with first, preferably from the highest interest rate to the lower ones.