JJG’s Outline of Bitcoin Investment Ideas

[JayJuanGee]

The longer that we are building up all of the various funds, then the more extensive emergencies that we can go through, and if guys are ongoingly tapping into their various back up funds in their first 4 years of investment and then maybe they are replenishing them after they tap into them, and so they might never get to points that they have a lot of back up funds because they are continuously tapping into them, and so if a real emergency comes, they might be disadvantaged by their earlier ongoingly tapping into back up funds behaviors.

Only this paragraph is enough for me, because it very understandable, it explains the importance of backup funds. backup is not only to have something use when problems pump up, but also to build some funds to protect yourself to avoid going back whenever unexpected emergency happens. Increasing the backup funds is very important, it should also grow as your income too, because investment and responsibility grow together, as investments growing , responsibility also increasing, and to make the investment moving smoothly, backup funds have to be strong. The point is to reach a level where any unexpected emergency cannot destroy a years we spent building out bitcoin position, that’s why backup funds is so important, because the more strong your backup funds become the more chances you have to hold your  bitcoin investment alone and handle emergency without panic.

You ought to be looking at backup funds more from the angle of financial stability rather than only just protecting your bitcoin.

The main reasons why investors create backup funds is to be able to use it to deal with unexpected expenses without having to disrupt their investment. Protecting their bitcoin investment is simply just one of the benefits of having that cushion.

If a person’s monthly essential expenses is $1000, and they have already built a backup fund worth about $6000, then that means that they already have about 6months worth of backup funds and so if it happens that their income increases in that period, it’s not really necessary for them to keep increasing the backup fund to $10,000 or $15,000. They should first of all consider whether their expenses and financial responsibilities have also increased.

Once you have been able to build a reasonable safety net, you can go ahead and focus on putting any extra money you got into other financial goals like buying more bitcoin instead of constantly trying to increase backup fund all the time.

Your example is quite bad, especially since you did not describe the context, and you might even be implying that some newbie bitcoin investor might be in such a situation, which is not a good one and it seems to be way overweighted in cash.  Why is he keeping so much cash?  Does he have any bitcoin?
 
I cannot see very many situations in which guys should be keeping 6 months in cash unless they maybe have 1-2 years or more of their expenses invested in bitcoin, and even then 6 months worth of back up funds is likely way too much.

Brand new investors who might come to bitcoin and they might already have back up funds somewhere in the 4-weeks territory (so let's say that they have something like $1k in back up funds with $1k in monthly income and maybe a $20k per year income (which is $1,667 per month of income), then maybe they would build their bitcoin and their back up funds at the same time, and maybe it would take them a couple more years to get up to $3k expenses in cash.. if we assume that they are investing $222, saving (back up funds) $222 and discretionarily consuming $222.   In my example it is going to take them 9 months to get up to $3k of back up funds.

Don't get me wrong, a person surely could build up more than 3 months of back up funds, since frequently we consider the first three months of the back up funds to be emergency funds, and then they could have other reasons that they are saving up extra money.  Maybe they want to buy a new cell phone or a car or a motorcycle or they want to fix the roof on their house or maybe they want to save some money for buying the dip. 

There can surely be quite a few reasons to build up back up funds to more than 3 months, and even when we are first building up our back up funds, there might be times in which we have to tap into them since there might be pay periods that we are low on income and/or high on expenses, so we might have some periods that we tap into some of our back up funds and then we have to build it back up to where we believe it should be, so we could even have some lopsided growing in our bitcoin versus our back up funds, and after we have 4-ish weeks of back up funds, maybe we will skew our investment towards bitcoin and maybe with my earlier example, there will be a preference to put $350 per month into bitcoin and only $158.5 per month into back up funds and $158.5 per month into discretionary consumption.  These are judgement calls, and of course, the more uncertain and precarious the income and/or expenses situation, then the more back up funds will be needed to account for the uncertainties in the income/expenses.

[edited out]

So, where is the loss if someone decides not to sell or simply doesn't plan to sell their Bitcoin?Even someone just starting out in investing whose foundation isn't yet solid would certainly consider what you are saying, whether for emergency funds or daily living expenses;

Of course if we are trying to figure out how to spend our income, the daily living expenses takes priority over building up our emergency funds, yet if we don't have any discretionary funds, then we would have to tap into our emergency funds or other back up funds that we have in order to cover our daily living expenses for that period until we have more income come in.

nor will they be rash or overly aggressive in their investments they certainly exercise good judgment and give these matters careful thought.
Is it possible that the word "aggressive" applies to someone who already has a strong foundation and doesn't dwell on such things? Surely not, right?

I like to think about aggressiveness as a choice within the discretionary income that we have available, yet you are also correct, that if a person has stronger cashflow management practices, such as keeping higher levels of back up funds, then he has more room to be more aggressive with his discretionary funds because he has a cushion of extra funds available in case he might overdo it any particular pay period.

So, aggressiveness tends to both have a harder boundary that relates to how much bitcoin we are capable of buying in any particular pay period from either the amount of the discretionary funds that we have and perhaps from any reserve funds that we might want to use for buying bitcoin in that pay period... So then if we measure the scope of how much of our funds that we can spend on bitcoin, then we also can consider how much we choose to spend on bitcoin, and of course, the mere fact that we can spend $300 during this pay period on bitcoin because we have $300 at our disposal does not necessarily mean that it is a good idea to spend the whole $300 on buying bitcoin, so then our choice within that $300  whether to spend $10 on bitcoin or the whole $300 or some amount in the middle is on a spectrum of whimpy on the low end and aggressive on the high end (perhaps even overly aggressive on the high end if we are using up all of our available money on bitcoin).

For someone who has accumulated at the highest price they bought and accumulated correctly then they sell it. Of course it is very clear that, They do not yet possess a solid internal foundation regarding investment itself. They do not yet fully understand Bitcoin itself.

If we are trying to be serious about investing into bitcoin, then we want to be putting systems into place in which we are either ongoingly buying bitcoin or we are refraining from buying based on our not having enough money available.  I tend to like to suggest that guys who are fairly early in their bitcoin accumulation phase, and maybe even their first whole 4 years of buying bitcoin, try to figure out ways that they can buy bitcoin every week no matter what.  That way the newbie guys are making sure to prioritize buying bitcoin to put themselves both in the right psychology and also in the right ongoing practice of buying bitcoin every week no matter what... so maybe if the guy has an amount of buying $30 no matter what, then maybe  he has a side fund that has $450, so that he knows that he has 15 weeks of bitcoin buying that is already in his reserve funds that is dedicated for buying bitcoin even during those pay periods that he has low income and/or high expenses... so if he is buying $30 worth of bitcoin no matter what, then he might have other weeks that he is buying $100 or more of bitcoin, so he is ongoingly buying bitcoin - unless he has some period of time that he absolutely cannot buy bitcoin due to either short-falls in his income and/or increases in his expenses.

Even though guys fuck up and they do stupid shit like selling bitcoin, I am not sure how helpful it is for us to be talking about dumb shit that guys do rather than trying to focus on creating good habits for ourselves and to help other guys to develop good habits, yet sure, if we know some guys who might have had made mistakes of selling bitcoin, they likely have both a wrong mindset and they also likely have a wrong practice set up.  If they are ongoingly buying bitcoin rather than fucking around waiting, then they might be able to get out of their bad psychology and their baed practices.

Another thing that sometimes can help the guys who are thinking about selling is that they can try to figure an amount that they are ready, willing and able to buy of bitcoin each week no matter what, and maybe the amount has to be a small amount so that they are not overly emotional about whether the BTC price is going up, down or sideways.  I see hardly any reason that an actual bitcoin investor should be concerning himself about bitcoin prices, especially if he is in his early stages of building his bitcoin in perhaps his first cycle of accumulating bitcoin. 

There are likely some guys who are able to front load their bitcoin investment based on their either having high discretionary income and/or their coming to bitcoin while already having other investments/assets that they can reallocate into bitcoin.

True, everyone has their own way of analyzing the market, but selling at a loss I think it's a silly move? Naturally, beginners who have suffered a loss are unlikely to trade again and repeat the same mistake. But would this happen to someone who already understands the industry and is deeply involved in it? Surely not; they certainly wouldn't sell at a loss, would they?

It can take a while to build up an investing rather than a trading/shitcoining and/or gambling mentality.  Frequently, in this thread, we discuss that guys do not need to have high levels of knowledge about either bitcoin or their cashflow management in order to get started buying bitcoin as long as they can determine that they have discretionary funds in order to get started buying bitcoin, yet at the same time, guys are not tending to start in their bitcoin journey without any knowledge, experiences and/or skills, so they likely will need to figure out how to start from where they are at and then to learn more about bitcoin (and bitcoin investing) as they go and to strengthen their cashflow management practices too, to the extent that their cashflow management practices need to be strengthened. 

I think that with bitcoin investing, as compared with other investing experiences, there can be quite a bit of value to tailorize the individual approach to dealing with bitcoin, which also involves the consideration of 9 individual factors and which presumes desires to strengthen cashflow management systems/practices.

[edited out]

A long-term investor can buy at any time. There is no mistake in buying. A long-term investor can buy at any time and if he holds it for a long time, then the possibility of his loss is very less. For example, if we look from the past to the present, the person who has been able to hold it at the lowest level of the long-term for 4 years has not faced any loss so far, if he had bought at the highest price at that time, then even at the current price he has not faced any loss.

A person who does trading or short-term investment often faces loss as a result of buying. The problem that often arises as a result of buying is that we invest outside our discretionary income and as a result we are forced to sell the investment before the end of the period. Due to this wrong decision, long-term investors often face loss.

Sure, if you are presuming 4-10 years  or longer, and you are presuming 4 years to be the lowest end of long term, then what are the circumstances of such thinking?  You sound like you are trying to get in and out of bitcoin based on your being in profits rather than really thinking about bitcoin as a long term investment rather than a trade, which might be why you spent so much of your post agonizing over the likelihood that bitcoin holdings are in profits after a guy had merely been in bitcoin for 4 years.

By the way, if a person had lump sum bought bitcoin 4 years ago and then had been just sitting on his lump sum buy, then what is the purpose in that?  On the other hand, maybe he lump sum bought 4 years ago, while at the same time he continued to buy bitcoin for the next 4 years, so then he has some of his holdings that are 4 years old, but then he has a bunch of scattered out buys in the last 4 years and some of them are 3 years old, some are 2 years old some are 1 year old and some are less than 1 year old. 

Are you trying to suggest that the 4 year guy can just think about his whole bitcoin stash as being 4 years old merely because he started buying bitcoin 4 years ago?  I have doubts about whether you have really given very much insightful thinking about the practicalities of accumulating bitcoin for 4 years for any guys who might be coming into their 4 year timeline of having had been involved in bitcoin.

[SmartCharpa]

Consistency is very important in anything we want to do in life because it help us get better and grow but been consistency does not mean one will use a particular amount for their investment all the time because capacity can not be the same all the time or remain unchanged because whatsoever that is giving someone an income will either reduce or increase as time goes by, so whenever someone income is been affected whether negatively or positively their capacity changes and so will their investment. anyone who invest beyond their capacity will always be liken to a trader or gambler.

To be successful in everything you do, you have to be consistent. Our investment strategy is not going to be the same, so you don’t need to compete with someone who has a higher income earning than you. I believe from the beginning of your investment, you already know what you can afford to invest, whether weekly or monthly. Many people hardly invest weekly due to their jobs, they usually get paid at the end of the month.

I don’t think a guy who has a job with a stable income is going to have any problem being consistent with their investment plan. There’s no way you are earning like $200 monthly, while investing like $50 a month, and I don’t think there will be a month where your salary will be reduced from what you normally earn. Sometimes we might be cut short by our expenses, you can stop buying, and continue whenever you are financially comfortable to continue buying.

[Princess Leah]

Consistency is very important in anything we want to do in life because it help us get better and grow but been consistency does not mean one will use a particular amount for their investment all the time because capacity can not be the same all the time or remain unchanged because whatsoever that is giving someone an income will either reduce or increase as time goes by, so whenever someone income is been affected whether negatively or positively their capacity changes and so will their investment. anyone who invest beyond their capacity will always be liken to a trader or gambler.

To be successful in everything you do, you have to be consistent. Our investment strategy is not going to be the same, so you don’t need to compete with someone who has a higher income earning than you. I believe from the beginning of your investment, you already know what you can afford to invest, whether weekly or monthly. Many people hardly invest weekly due to their jobs, they usually get paid at the end of the month.

I don’t think a guy who has a job with a stable income is going to have any problem being consistent with their investment plan. There’s no way you are earning like $200 monthly, while investing like $50 a month, and I don’t think there will be a month where your salary will be reduced from what you normally earn. Sometimes we might be cut short by our expenses, you can stop buying, and continue whenever you are financially comfortable to continue buying.

That's true @SmartCharpa, consistency especially in a volatile asset like Bitcoin is very important so investors need to take that seriously especially low income earners who barely have enough discretionary funds to buy more, however they're not left out cause consistency plays a role in helping them accumulate something meaningful overtime and the more they keep holding and adding to the portfolio the better their chances of better returns if Bitcoin goes higher.

 Anyone that takes Bitcoin investment as a competition might likely end up getting their portfolio complicated cause the person might end up investing with money for essentials just to meet up with someone they know is investing higher.

[Charcol]

It is largely a matter of flexibility we do not need to buy Bitcoin in specific large or small amounts, but consistency is key ensuring that our purchasing process is regular, precise, and steady.
Time is not the primary constraint the main thing is to keep striving to buy Bitcoin whenever we have discretionary income, regardless of the amount we can afford. Even if the individual purchase amounts are small, consistently accumulating Bitcoin places us among those who maintain a disciplined approach to buying aligning with the principles often discussed in this context.

Many people have multiple sources of income, yet they often lack consistency in safeguarding their previous investments after making a purchase. This contrasts with those who wait until their basic needs are met and then accumulate Bitcoin using only the remaining discretionary funds. Ultimately, it depends on how we manage the process; we want to avoid investment errors—and certainly avoid losses—that could arise from accumulating Bitcoin incorrectly.

A long-term investor can buy at any time. There is no mistake in buying. A long-term investor can buy at any time and if he holds it for a long time, then the possibility of his loss is very less. For example, if we look from the past to the present, the person who has been able to hold it at the lowest level of the long-term for 4 years has not faced any loss so far, if he had bought at the highest price at that time, then even at the current price he has not faced any loss.

It is not that simple to say that there will be no loss if you keep it for a long time. You may have reached this conclusion by looking at the good performance of the past, but it cannot be said for sure that you will definitely make a profit after 4 years in any future entry. Again, long-term investment does not mean that you kept it for only four years and it made a profit. There are two investors, one of them buys a lump sum once in January 2026 and does nothing for four years, then his investment journey will be the same. And if the second one starts at the same time and accumulates with regular discretionary income for four years, then his investment journey will not be the same. Perhaps the second one can be in a stronger position than the first one.

Again, 4 years is not a magical limit that his accumulation target will be met in 4 years. It may take 8, 10 or even more years to meet someone's accumulation target. The matter depends on the income of the person, discretionary funds, starting age, target and portfolio size.

[Grease5000]

It is not that simple to say that there will be no loss if you keep it for a long time. You may have reached this conclusion by looking at the good performance of the past, but it cannot be said for sure that you will definitely make a profit after 4 years in any future entry. Again, long-term investment does not mean that you kept it for only four years and it made a profit. There are two investors, one of them buys a lump sum once in January 2026 and does nothing for four years, then his investment journey will be the same. And if the second one starts at the same time and accumulates with regular discretionary income for four years, then his investment journey will not be the same. Perhaps the second one can be in a stronger position than the first one.

Again, 4 years is not a magical limit that his accumulation target will be met in 4 years. It may take 8, 10 or even more years to meet someone's accumulation target. The matter depends on the income of the person, discretionary funds, starting age, target and portfolio size.

I agree with you. Four years should not be treated as a fixed rule or guarantee of profit. Because bitcoin can take much longer to reach someone's investment goal.

Like most people always talking about profit at the end of a circle, aside making  profit, most people buy bitcoin and hold for the long term as a way  of saving for  the future without taking into consideration extra profit they will make from it  rather they see it as an asset with a long term store value.

[reagansimms]

~~~

To be successful in everything you do, you have to be consistent. Our investment strategy is not going to be the same, so you don’t need to compete with someone who has a higher income earning than you. I believe from the beginning of your investment, you already know what you can afford to invest, whether weekly or monthly. Many people hardly invest weekly due to their jobs, they usually get paid at the end of the month.

Consistency is the key, not the size of the investment amount or competing with others. Compare yourself this month to last month, and if possible, increase your purchase amount. You don't need a large salary to get started. And never compare your portfolio with others. What matters is starting with an amount you can afford to invest. Everyone has a different cash flow, some get paid weekly, while others are paid monthly. In reality, this isn't a major issue. What matters is maintaining discipline and ensuring that investments continue uninterrupted. After all, Bitcoin rewards patient investors, not those who constantly wait or try to guess the absolute lowest price.

I don’t think a guy who has a job with a stable income is going to have any problem being consistent with their investment plan. There’s no way you are earning like $200 monthly, while investing like $50 a month, and I don’t think there will be a month where your salary will be reduced from what you normally earn. Sometimes we might be cut short by our expenses, you can stop buying, and continue whenever you are financially comfortable to continue buying.

It is true that having a stable income makes it easier to stay consistent. However, the reality is that setting aside $50 for investment out of a $200 salary feels like a significant amount to some people, as it represents 25% of their earnings. In my opinion, a more realistic approach is to start with 5% or 10%, as that already constitutes DCA. Consistency isn't about large amounts, it's about keeping at it, even if it's just $10 or $20 a month. It is understandable to stop buying temporarily due to an emergency. However, what is risky is stopping purchases in anticipation of a price drop.

[Zackz5000]

It is not that simple to say that there will be no loss if you keep it for a long time. You may have reached this conclusion by looking at the good performance of the past, but it cannot be said for sure that you will definitely make a profit after 4 years in any future entry. Again, long-term investment does not mean that you kept it for only four years and it made a profit. There are two investors, one of them buys a lump sum once in January 2026 and does nothing for four years, then his investment journey will be the same. And if the second one starts at the same time and accumulates with regular discretionary income for four years, then his investment journey will not be the same. Perhaps the second one can be in a stronger position than the first one.

Again, 4 years is not a magical limit that his accumulation target will be met in 4 years. It may take 8, 10 or even more years to meet someone's accumulation target. The matter depends on the income of the person, discretionary funds, starting age, target and portfolio size.

I agree with you. Four years should not be treated as a fixed rule or guarantee of profit. Because bitcoin can take much longer to reach someone's investment goal.

Like most people always talking about profit at the end of a circle, aside making  profit, most people buy bitcoin and hold for the long term as a way  of saving for  the future without taking into consideration extra profit they will make from it  rather they see it as an asset with a long term store value.

It is not still guarantee that if anyone accumulate and hodl Bitcoin for 4-10 year that they will be in profit it's never true as nothing is for sure guarantee in this journey. People should there by consider investing in Bitcoin with their discretionary income and still have in there mind that they can't still be in profit even after holding for years.

Though from the history of Bitcoin those who were able to accumulate and hodl there Bitcoin for long has never lost but we can't use the past to determine what will actually happen in the future or in years to come, despite this Bitcoin still remain as strong asset a store of value that every household need to have as a future asset.

[Futurexxx]

I don’t think a guy who has a job with a stable income is going to have any problem being consistent with their investment plan. There’s no way you are earning like $200 monthly, while investing like $50 a month, and I don’t think there will be a month where your salary will be reduced from what you normally earn. Sometimes we might be cut short by our expenses, you can stop buying, and continue whenever you are financially comfortable to continue buying.

It is true that having a stable income makes it easier to stay consistent. However, the reality is that setting aside $50 for investment out of a $200 salary feels like a significant amount to some people, as it represents 25% of their earnings. In my opinion, a more realistic approach is to start with 5% or 10%, as that already constitutes DCA. Consistency isn't about large amounts, it's about keeping at it, even if it's just $10 or $20 a month. It is understandable to stop buying temporarily due to an emergency. However, what is risky is stopping purchases in anticipation of a price drop.

If you are earning $200 a month and you choose to invest $50 or even $10 or $20 as you are proclaiming, it's still a wrong approach because miscalculation might put you in serious trouble, so in whatever you are doing, it's very important to figure out your discretionary income first, by first taking care of your basic needs, then whatsoever that is left is what you should be investing with, which might be $10-50 or even possible $70, but for clarity and the avoidance of making any mistakes, it's important that you figure out your discretionary income first before investing what so ever that is left, not by investing a portion of your net income without first taking care of your basic needs. That would be problematic in the longer run.

[Alonso_]

I don’t think a guy who has a job with a stable income is going to have any problem being consistent with their investment plan. There’s no way you are earning like $200 monthly, while investing like $50 a month, and I don’t think there will be a month where your salary will be reduced from what you normally earn. Sometimes we might be cut short by our expenses, you can stop buying, and continue whenever you are financially comfortable to continue buying.

It is true that having a stable income makes it easier to stay consistent. However, the reality is that setting aside $50 for investment out of a $200 salary feels like a significant amount to some people, as it represents 25% of their earnings. In my opinion, a more realistic approach is to start with 5% or 10%, as that already constitutes DCA. Consistency isn't about large amounts, it's about keeping at it, even if it's just $10 or $20 a month. It is understandable to stop buying temporarily due to an emergency. However, what is risky is stopping purchases in anticipation of a price drop.

If you are earning $200 a month and you choose to invest $50 or even $10 or $20 as you are proclaiming, it's still a wrong approach because miscalculation might put you in serious trouble, so in whatever you are doing, it's very important to figure out your discretionary income first, by first taking care of your basic needs, then whatsoever that is left is what you should be investing with, which might be $10-50 or even possible $70, but for clarity and the avoidance of making any mistakes, it's important that you figure out your discretionary income first before investing what so ever that is left, not by investing a portion of your net income without first taking care of your basic needs. That would be problematic in the longer run.

You’re correct, I think the best thing you have to do as an investor is taking care of your basic needs first of all, an investor who have a good mindset would know the right thing to do when investing in Bitcoin, having a discretionary income is very vital, some investors usually struggle with figuring out their discretionary income, because they probably have a low cashflow, when they’ve a $10 left over discretionary income they would possibly want to buy bitcoin from there, not everyone have money to really buy and accumulate regularly but when they have a chance of discretionary income they will try buying bitcoin.

[sotelorene]

You’re correct, I think the best thing you have to do as an investor is taking care of your basic needs first of all, an investor who have a good mindset would know the right thing to do when investing in Bitcoin, having a discretionary income is very vital, some investors usually struggle with figuring out their discretionary income, because they probably have a low cashflow, when they’ve a $10 left over discretionary income they would possibly want to buy bitcoin from there, not everyone have money to really buy and accumulate regularly but when they have a chance of discretionary income they will try buying bitcoin.

Anyone who used his expenses funds to purchase Bitcoin will use his tongue to count his teeth because they will learn the hard way and this is what most traders do, lack of financial management and sometimes they do this because of greed to make X of the  fund they use and the funny part is that after they have used expenses money to trade they will beg the market to move on their direction so they can make profit but that is not going to work so in Bitcoin don't do the wrong thing and be praying and hoping to be lucky. That is why it is cool to use what we can afford and investment is not a must if you don't have discretionary income then forget about it.

[Decimetre]

So, where is the loss if someone decides not to sell or simply doesn't plan to sell their Bitcoin?Even someone just starting out in investing whose foundation isn't yet solid would certainly consider what you are saying, whether for emergency funds or daily living expenses; nor will they be rash or overly aggressive in their investments they certainly exercise good judgment and give these matters careful thought.
Is it possible that the word "aggressive" applies to someone who already has a strong foundation and doesn't dwell on such things? Surely not, right?

For someone who has accumulated at the highest price they bought and accumulated correctly then they sell it. Of course it is very clear that, They do not yet possess a solid internal foundation regarding investment itself. They do not yet fully understand Bitcoin itself.

A person's foundation matters and determines his decisions and inactions. A person who has the right knowledge about bitcoin will not want to sell at loss because he believes in the future of bitcoin. The word 'Aggressive" may not be limited to only having a strong foundation about bitcoin because a person can only go aggressively when he has the right means to do it rightly and not because of fear of missing out on opportunities. But having a strong foundation in the industry gives greater conviction than what you are doing is right and not based on a hearsay and keeps you from losses.

True, everyone has their own way of analyzing the market, but selling at a loss I think it's a silly move? Naturally, beginners who have suffered a loss are unlikely to trade again and repeat the same mistake. But would this happen to someone who already understands the industry and is deeply involved in it? Surely not; they certainly wouldn't sell at a loss, would they?

For sure, selling at a loss is a silly move and I discourage such practice. I was only trying to explain what  @Johnsaributua could have meant by using such term as 'losses due to incorrect bitcoin accumulation' but that does not imply that I support selling bitcoin at loss for any reason.

Beginners have to be careful with their approach to bitcoin accumulation and emergency funds accumulation simultaneously because just like you said, when a beginner suffers losses due to his wrong decisions he gets scared away from continuing his investment. A person who understands the industry would not get tempted to sell or would he spend more time analysing the market? When a person is in for a long-term investment, he reduces the time spent on analyses because that is where the fear begins.

[avp2306]

You ought to be looking at backup funds more from the angle of financial stability rather than only just protecting your bitcoin.

The main reasons why investors create backup funds is to be able to use it to deal with unexpected expenses without having to disrupt their investment. Protecting their bitcoin investment is simply just one of the benefits of having that cushion.

If a person’s monthly essential expenses is $1000, and they have already built a backup fund worth about $6000, then that means that they already have about 6months worth of backup funds and so if it happens that their income increases in that period, it’s not really necessary for them to keep increasing the backup fund to $10,000 or $15,000. They should first of all consider whether their expenses and financial responsibilities have also increased.

Once you have been able to build a reasonable safety net, you can go ahead and focus on putting any extra money you got into other financial goals like buying more bitcoin instead of constantly trying to increase backup fund all the time.

Your example is quite bad, especially since you did not describe the context, and you might even be implying that some newbie bitcoin investor might be in such a situation, which is not a good one and it seems to be way overweighted in cash.  Why is he keeping so much cash?  Does he have any bitcoin?
 
I cannot see very many situations in which guys should be keeping 6 months in cash unless they maybe have 1-2 years or more of their expenses invested in bitcoin, and even then 6 months worth of back up funds is likely way too much.

Brand new investors who might come to bitcoin and they might already have back up funds somewhere in the 4-weeks territory (so let's say that they have something like $1k in back up funds with $1k in monthly income and maybe a $20k per year income (which is $1,667 per month of income), then maybe they would build their bitcoin and their back up funds at the same time, and maybe it would take them a couple more years to get up to $3k expenses in cash.. if we assume that they are investing $222, saving (back up funds) $222 and discretionarily consuming $222.   In my example it is going to take them 9 months to get up to $3k of back up funds.

Don't get me wrong, a person surely could build up more than 3 months of back up funds, since frequently we consider the first three months of the back up funds to be emergency funds, and then they could have other reasons that they are saving up extra money.  Maybe they want to buy a new cell phone or a car or a motorcycle or they want to fix the roof on their house or maybe they want to save some money for buying the dip. 

There can surely be quite a few reasons to build up back up funds to more than 3 months, and even when we are first building up our back up funds, there might be times in which we have to tap into them since there might be pay periods that we are low on income and/or high on expenses, so we might have some periods that we tap into some of our back up funds and then we have to build it back up to where we believe it should be, so we could even have some lopsided growing in our bitcoin versus our back up funds, and after we have 4-ish weeks of back up funds, maybe we will skew our investment towards bitcoin and maybe with my earlier example, there will be a preference to put $350 per month into bitcoin and only $158.5 per month into back up funds and $158.5 per month into discretionary consumption.  These are judgement calls, and of course, the more uncertain and precarious the income and/or expenses situation, then the more back up funds will be needed to account for the uncertainties in the income/expenses.

Its kinda overkill right? especially for newbies to hide 6 moths worth of back up funds unless their income is unstable or maybe they have those so special reason to hold lots of money.

I agree that 3 months back up funds is enough, since this is already enough for people to cover up those real time disruptions. Then the rest of their funds can be use between on Bitcoin investment and saving for certain goals they plans.

Those allocation will naturally change as they grow. Then once they already build their cash and also their investment made on Bitcoin, also when they already have 4 - 6 weeks or reserve cash. They can start to decide to put much bigger funds or surplus cash on Bitcoin. Then also the amount of extra cash they keep will always depends on their income and also on the goals they are preparing.

[Different patterns]

nor will they be rash or overly aggressive in their investments they certainly exercise good judgment and give these matters careful thought.
Is it possible that the word "aggressive" applies to someone who already has a strong foundation and doesn't dwell on such things? Surely not, right?

I like to think about aggressiveness as a choice within the discretionary income that we have available, yet you are also correct, that if a person has stronger cashflow management practices, such as keeping higher levels of back up funds, then he has more room to be more aggressive with his discretionary funds because he has a cushion of extra funds available in case he might overdo it any particular pay period.

So, aggressiveness tends to both have a harder boundary that relates to how much bitcoin we are capable of buying in any particular pay period from either the amount of the discretionary funds that we have and perhaps from any reserve funds that we might want to use for buying bitcoin in that pay period... So then if we measure the scope of how much of our funds that we can spend on bitcoin, then we also can consider how much we choose to spend on bitcoin, and of course, the mere fact that we can spend $300 during this pay period on bitcoin because we have $300 at our disposal does not necessarily mean that it is a good idea to spend the whole $300 on buying bitcoin, so then our choice within that $300  whether to spend $10 on bitcoin or the whole $300 or some amount in the middle is on a spectrum of whimpy on the low end and aggressive on the high end (perhaps even overly aggressive on the high end if we are using up all of our available money on bitcoin).

Being aggressive depends how strong our financial situation is, not how much we have available all the time, Two people can have $300 after taking care of basic needs, but that same $300 can mean different things is just depends on each of their backup funds. But I most say the important thing is to do possible best that being aggressive with bitcoin does not put us in difficult position later, because for instance now I invest $250 today and suddenly something comes up as a result of urgent emergency the following week or month, that may force me to sell my bitcoin, because I was too aggressive, even if I had the funds that time. Just because we have it available, not necessarily mean we most invest everything, sometimes invest little amount and keep some available is the best decision.

[Hardyrobust]

It is not that simple to say that there will be no loss if you keep it for a long time. You may have reached this conclusion by looking at the good performance of the past, but it cannot be said for sure that you will definitely make a profit after 4 years in any future entry. Again, long-term investment does not mean that you kept it for only four years and it made a profit. There are two investors, one of them buys a lump sum once in January 2026 and does nothing for four years, then his investment journey will be the same. And if the second one starts at the same time and accumulates with regular discretionary income for four years, then his investment journey will not be the same. Perhaps the second one can be in a stronger position than the first one.

Again, 4 years is not a magical limit that his accumulation target will be met in 4 years. It may take 8, 10 or even more years to meet someone's accumulation target. The matter depends on the income of the person, discretionary funds, starting age, target and portfolio size.

I agree with you. Four years should not be treated as a fixed rule or guarantee of profit. Because bitcoin can take much longer to reach someone's investment goal.

Like most people always talking about profit at the end of a circle, aside making  profit, most people buy bitcoin and hold for the long term as a way  of saving for  the future without taking into consideration extra profit they will make from it  rather they see it as an asset with a long term store value.

It is not still guarantee that if anyone accumulate and hodl Bitcoin for 4-10 year that they will be in profit it's never true as nothing is for sure guarantee in this journey. People should there by consider investing in Bitcoin with their discretionary income and still have in there mind that they can't still be in profit even after holding for years.

Though from the history of Bitcoin those who were able to accumulate and hodl there Bitcoin for long has never lost but we can't use the past to determine what will actually happen in the future or in years to come, despite this Bitcoin still remain as strong asset a store of value that every household need to have as a future asset.

Holding bitcoin for a long doesn't mean profit is guarantee at the end ,that is true. However those that have invested in bitcoin for a long term like 5-10years can't  any way be compared to short term holders in terms of profit. The fact that profit isn't guarantee while holding for a long doesn't make short term holding an option. Holding bitcoin for a short term is far more risky than holding for a long term. Moreover, not everyone that is holding bitcoin is doing so because of profits, there are different reasons why people holding bitcoin for a long term.

[@nn@_pen9]

So, where is the loss if someone decides not to sell or simply doesn't plan to sell their Bitcoin?Even someone just starting out in investing whose foundation isn't yet solid would certainly consider what you are saying, whether for emergency funds or daily living expenses; nor will they be rash or overly aggressive in their investments they certainly exercise good judgment and give these matters careful thought.
Is it possible that the word "aggressive" applies to someone who already has a strong foundation and doesn't dwell on such things? Surely not, right?

For someone who has accumulated at the highest price they bought and accumulated correctly then they sell it. Of course it is very clear that, They do not yet possess a solid internal foundation regarding investment itself. They do not yet fully understand Bitcoin itself.

A person's foundation matters and determines his decisions and inactions. A person who has the right knowledge about bitcoin will not want to sell at loss because he believes in the future of bitcoin. The word 'Aggressive" may not be limited to only having a strong foundation about bitcoin because a person can only go aggressively when he has the right means to do it rightly and not because of fear of missing out on opportunities. But having a strong foundation in the industry gives greater conviction than what you are doing is right and not based on a hearsay and keeps you from losses.

True, everyone has their own way of analyzing the market, but selling at a loss I think it's a silly move? Naturally, beginners who have suffered a loss are unlikely to trade again and repeat the same mistake. But would this happen to someone who already understands the industry and is deeply involved in it? Surely not; they certainly wouldn't sell at a loss, would they?

For sure, selling at a loss is a silly move and I discourage such practice. I was only trying to explain what  @Johnsaributua could have meant by using such term as 'losses due to incorrect bitcoin accumulation' but that does not imply that I support selling bitcoin at loss for any reason.

Beginners have to be careful with their approach to bitcoin accumulation and emergency funds accumulation simultaneously because just like you said, when a beginner suffers losses due to his wrong decisions he gets scared away from continuing his investment. A person who understands the industry would not get tempted to sell or would he spend more time analysing the market? When a person is in for a long-term investment, he reduces the time spent on analyses because that is where the fear begins.

Yes, I might be able to accept your argument at this point. Indeed, it is only fitting for anyone whether intending to invest or do anything else,  Building that foundation serves as a fundamental prerequisite before taking action or making an investment; this is for the individual's own benefit to avoid losses.

However, regarding what @Johnsaributua wrote about "losses due to flawed Bitcoin accumulation" if you persist in that same mindset, then from my perspective, it clearly makes absolutely no sense. As I understand it, the loss occurs when the total amount we invested say, $100 And when we actually incur a loss, it is certainly the result of a transaction we carried out the amount we receive isn't the full $100 let's say we get half, or $50 so, in my view, that clearly constitutes a loss.

In my view, the language of accumulation itself implies that the individual wishes to increase their investment assets. As for investment itself, there is one aspect that cannot be avoided: the fluctuations that occur . However, the loss itself cannot be factored into that accumulation; those accumulating Bitcoin are certainly aware that their investment is experiencing a decline in fiat value, rather than constituting a realized loss.

[ZeroVinsonN]

What do you mean by safeguarding their previous investment, you mentioned it but didn't point out how you intend of doing so,  the best way to do so is to make sure your backup funds are in place, this can't happen right away so as an investor you have to do it gradually over time along side your investment, because the simple truth is that even though you make sure to pay your bills before you buy bitcoin you still can't call that safeguarding, not until you involve your emergency fund as having your emergency fund in place is one of the best ways to safeguard your investment.

I would like to note that even if you pay your bills from month to month, buy food and know approximately how much free money you have left for investing, then this is not the way to absolute confidence in studying your expenses, and as a result, the share of income that can be invested. I recommend taking a period of about a year to understand how much money will be spent each month, because every month has its own expenses, for example, like New Year's gifts. And only a general overview of spending during the year will give an understanding of how much free funds may remain, and based on this discretionary income, it will be possible to decide exactly What percentage of funds can be allocated for investment.

I should spend a year trying to figure out how much discretionary income I'm actually generating? I don't see how that will even make sense to you, I don't need all that time just do get a hold on how my expenses work so I can know how much of my money will go to my discretionary income, as long as my bills have been paid for then what's left is my discretionary income, of course from month to month my discretionary income will vary, I can't say I expect my expenses to be the same every month so it stands to reason that my discretionary income will fluctuate as well, all I have to do is to make sure that even with all that fluctuation my investment stays within my discretionary income, as long as I don't invest outside of it.

[Agbam]

The investment amount should be such that it is possible to maintain it for a long time without stress. The main thing in investment is consistency, no matter how much you invest, the main thing is whether you are able to maintain it consistently, now if you decide to invest beyond your capacity, then you will definitely not be able to maintain one for the long term. Therefore, the main thing is to invest only the amount of your capacity. Investing a large amount in one month, and another month is zero, this should not be like that, but investing in regular and realistic amounts is much more effective, which can ensure long-term stability. Because after all, Bitcoin is volatile in the short term, and creates possibilities in the long term, and therefore long-term stability is the most important thing here.

Yes, we can all agree that in bitcoin investment consistency is essential. However, I wouldn’t want to put myself under pressure to maintain a fixed amount that’s why I prefer using a flexible form of DCA in which I invest weekly based on my available discretionary income.

Some investors can be disciplined and financially capable enough to maintain a fixed amount of DCA weekly or monthly which is good but it doesn’t work for everybody. So instead of fixing an amount to be invested that may likely become difficult to maintain I prefer to invest an amount I can comfortably afford weekly.

For me, the goal isn’t to just invest same amount every week, but to be able to maintain consistency without putting myself under any kind of pressure. That is the goal for the long term.

[Creeper0]

I would like to note that even if you pay your bills from month to month, buy food and know approximately how much free money you have left for investing, then this is not the way to absolute confidence in studying your expenses, and as a result, the share of income that can be invested. I recommend taking a period of about a year to understand how much money will be spent each month, because every month has its own expenses, for example, like New Year's gifts. And only a general overview of spending during the year will give an understanding of how much free funds may remain, and based on this discretionary income, it will be possible to decide exactly What percentage of funds can be allocated for investment.

I should spend a year trying to figure out how much discretionary income I'm actually generating? I don't see how that will even make sense to you, I don't need all that time just do get a hold on how my expenses work so I can know how much of my money will go to my discretionary income, as long as my bills have been paid for then what's left is my discretionary income, of course from month to month my discretionary income will vary, I can't say I expect my expenses to be the same every month so it stands to reason that my discretionary income will fluctuate as well, all I have to do is to make sure that even with all that fluctuation my investment stays within my discretionary income, as long as I don't invest outside of it.

No need for such complicated calculations, keep bearing your necessary expenses every month and after getting the next month's salary, see how much money is left in your fund, whatever is there is your discretionary money. When you allocate discretionary money at the beginning of the month after getting the salary. Then you may have to go through complicated calculations and investments may be made outside the discretionary money, because expenses are not stable and not expected. If you allocate discretionary money at the beginning of the month, then you need to keep your backup funds strong. If you plan to invest by allocating the remaining money as discretionary money after all expenses, then you do not have to go through any complicated calculations and do not have to spend extra energy on other funds except emergency funds in the backup fund.

Both methods are good and both methods are used. It is your choice which method you allocate discretionary money. And spending 1 year to acquire the knowledge of discretionary money allocation is redundant. Even a 12-13 year old child can learn to allocate discretionary money in less than 1 month.

[ChocolateBitcoinK]

It is not that simple to say that there will be no loss if you keep it for a long time. You may have reached this conclusion by looking at the good performance of the past, but it cannot be said for sure that you will definitely make a profit after 4 years in any future entry. Again, long-term investment does not mean that you kept it for only four years and it made a profit. There are two investors, one of them buys a lump sum once in January 2026 and does nothing for four years, then his investment journey will be the same. And if the second one starts at the same time and accumulates with regular discretionary income for four years, then his investment journey will not be the same. Perhaps the second one can be in a stronger position than the first one.

Again, 4 years is not a magical limit that his accumulation target will be met in 4 years. It may take 8, 10 or even more years to meet someone's accumulation target. The matter depends on the income of the person, discretionary funds, starting age, target and portfolio size.

I agree with you. Four years should not be treated as a fixed rule or guarantee of profit. Because bitcoin can take much longer to reach someone's investment goal.

Like most people always talking about profit at the end of a circle, aside making  profit, most people buy bitcoin and hold for the long term as a way  of saving for  the future without taking into consideration extra profit they will make from it  rather they see it as an asset with a long term store value.

It is not still guarantee that if anyone accumulate and hodl Bitcoin for 4-10 year that they will be in profit it's never true as nothing is for sure guarantee in this journey. People should there by consider investing in Bitcoin with their discretionary income and still have in there mind that they can't still be in profit even after holding for years.

Though from the history of Bitcoin those who were able to accumulate and hodl there Bitcoin for long has never lost but we can't use the past to determine what will actually happen in the future or in years to come, despite this Bitcoin still remain as strong asset a store of value that every household need to have as a future asset.

Holding bitcoin for a long doesn't mean profit is guarantee at the end ,that is true. However those that have invested in bitcoin for a long term like 5-10years can't  any way be compared to short term holders in terms of profit. The fact that profit isn't guarantee while holding for a long doesn't make short term holding an option. Holding bitcoin for a short term is far more risky than holding for a long term. Moreover, not everyone that is holding bitcoin is doing so because of profits, there are different reasons why people holding bitcoin for a long term.

There is no guarantee of making a profit in Bitcoin investment, no matter how well you manage everything, there is no guarantee at the end of the day. But yes, we have always found that if you hold Bitcoin for the long term, you will definitely be much ahead of other short-term traders in the long term. The market moves in a way that is almost impossible to determine, and therefore you will never achieve anything good by buying and selling in the short term. Instead, hold for the long term, keep buying continuously, this will bring you success in the long term. If you hold consistently than what other people will gain by calculating their profits and losses through buying and selling, then the success will be richer.

[ZeroVinsonN]

I would like to note that even if you pay your bills from month to month, buy food and know approximately how much free money you have left for investing, then this is not the way to absolute confidence in studying your expenses, and as a result, the share of income that can be invested. I recommend taking a period of about a year to understand how much money will be spent each month, because every month has its own expenses, for example, like New Year's gifts. And only a general overview of spending during the year will give an understanding of how much free funds may remain, and based on this discretionary income, it will be possible to decide exactly What percentage of funds can be allocated for investment.

I should spend a year trying to figure out how much discretionary income I'm actually generating? I don't see how that will even make sense to you, I don't need all that time just do get a hold on how my expenses work so I can know how much of my money will go to my discretionary income, as long as my bills have been paid for then what's left is my discretionary income, of course from month to month my discretionary income will vary, I can't say I expect my expenses to be the same every month so it stands to reason that my discretionary income will fluctuate as well, all I have to do is to make sure that even with all that fluctuation my investment stays within my discretionary income, as long as I don't invest outside of it.

No need for such complicated calculations, keep bearing your necessary expenses every month and after getting the next month's salary, see how much money is left in your fund, whatever is there is your discretionary money. When you allocate discretionary money at the beginning of the month after getting the salary. Then you may have to go through complicated calculations and investments may be made outside the discretionary money, because expenses are not stable and not expected. If you allocate discretionary money at the beginning of the month, then you need to keep your backup funds strong. If you plan to invest by allocating the remaining money as discretionary money after all expenses, then you do not have to go through any complicated calculations and do not have to spend extra energy on other funds except emergency funds in the backup fund.

Both methods are good and both methods are used. It is your choice which method you allocate discretionary money. And spending 1 year to acquire the knowledge of discretionary money allocation is redundant. Even a 12-13 year old child can learn to allocate discretionary money in less than 1 month.

If you decide on your discretionary income this way then how sure will you be that the money you are using is actually your discretionary income? What if you haven't paid all of your bills for the previous month and then you get paid for the new month, if you tag whatever is left of your last month's earning as discretionary when there are bills from that month that probably due to delays were not paid then wouldn't you just be increasing the number of things you have to pay for with the new month earnings, our discretionary income is what's left after we've paid for our essentials and not what we are yet to spend till a new month comes around.
Or maybe I just don't understand what you mean here.