JJG’s Outline of Bitcoin Investment Ideas

[JayJuanGee]

It is not a good idea for an investor to neglect or forget to build an emergency funds or discretionary spending because of having low discretionary income. The idea of dividing discretionary income into 3 parts is a great one , however it is not that all investors that must follow this same pattern. Everyone should do what will work best for them as per there financial situation. An investor can decide to follow the percentage you have given and another investor may choose to use a different percentage. The most important thing is using the percentage that goes well with their financial situation.

No magic percentage There is no definitive percentage for all, since every individual's financial income, outflow, liabilities and commitments will be different. Splitting one's discretionary cash into three may be a thumb rule but not one you have to blindly stick to. Ideally, I'd feel it is important to build up an emergency fund first, before taking major investment bets.

It will give an investor breathing space should any sudden requirement force the individual to liquify an investment at a loss; which might compound the financial anxiety.

However, I am conscious this methodology may not be suitable for the low earning individual, whose entire discretionary funds are required for meeting his day-to-day needs and the odd emergency. Ultimately, it's all about maintaining a healthy balance of saving, spending and investment and stick to a method that's practical.

First. Of course, guys can give some priorities in regards to making sure that they have back up funds, especially when they invest and they are expecting to lock up those invested funds for 4-10 years or longer and perhaps with a possibility of completely losing those invested funds.

Many guys here know that I am a pretty strong advocate for getting started, yet at the same time, guys likely need to have at least some bare minimum level of back up funds, such as a week or two of their expenses so that they have some cash cushion just in the mere fluctuations of income/expenses between and within pay periods.  Otherwise, how much priority to give to back up funds versus bitcoin would be matters of personal priority and maybe financial circumstances (such as how steady is the expected income/expenses), and surely since we are in a bitcoin investing thread, I personally am suggesting that there is value in giving priority to bitcoin investing and building our bitcoin holdings, even if we might be needing to build our back up funds at the same time as we are building our bitcoin holdings.  We might spend some time to get our bitcoin and our back up funds to similar levels and then maybe we might chose to build our bitcoin holdings at a faster rate than our back up funds, and it could take us several months, and maybe even a year or longer to get our back up funds and our bitcoin holdings to a mere 3 months of our expenses.

And as bitcoin newbie investors we also may well be needing to give some time and attention in figuring out ways to try to strengthen our cashflows and even our getting our discretionary income to higher levels by trying to increase our income and/or decrease our expenses.

Second.  You proclaim that guys may well be meeting their day to day needs with their discretionary funds, which seems a wee bit of a ridiculous statement, since discretionary funds tend to be funds that are available after basic expenses have been accounted for. So if guys do not have enough discretionary funds left over after accounting for basic expenses, then he may well not have enough discretionary funds.. so guys cannot invest if they do not have enough discretionary funds.  

If guys are trying to buy bitcoin with funds that they are not sure about whether they need them for basic expenses or not, then they are engaging in a kind of trade and/or gamble to hope and pray that they will have enough money to cover all of their basic expenses,  but they are using money that may or may not be needed to cover those basic expenses.  I surely recommend against guys trying to trade or gamble with bitcoin, and I think that they should be investing with funds that they can afford to lose and also that they are considering that their investment timeline is 4-10 years or longer.

Yeah, beginners to bitcoin might not have had accepted a 4-10 year or longer timeline, yet they can still get started buying bitcoin, and I would think that the more that they learn about bitcoin as they are buying it, they will come to realize that bitcoin is better as an investment (which means 4-10 years or longer) rather than a trade or trying to play bitcoin in shorter than 4 year time horizons.

[ZeroVinsonN]

Anyone who is able to figure out their discretionary income should be able to know the amount that will be reasonable and convenient for them unless they decide to be overly aggressive about it which may affect them later if they continue to be over aggressive. This 1/3 method you are talking about can not work for everyone and it is not written anywhere that it is very convenient because everyone discretionary income are not the same, the most important thing is using what is convenient.

So they should ignore their backup funds or their discretionary spendings because they don't have enough discretionary income? This 1/3 method is good for everyone and one thing that people should know is that they can split their discretionary income however that works for them, it's not a must that the 3 way split must be equal, you can go 40% for your bitcoin investment, 40% for your emergency funds and 20% for your discretionary spendings, you can even go 50% for investing in bitcoin, 35% for your emergency fund and 15% for your discretionary spendings, it all depends on which split works the best for you.

It is not a good idea for an investor to neglect or forget to build an emergency funds or discretionary spending because of having low discretionary income. The idea of dividing discretionary income into 3 parts is a great one , however it is not that all investors that must follow this same pattern. Everyone should do what will work best for them as per there financial situation. An investor can decide to follow the percentage you have given and another investor may choose to use a different percentage. The most important thing is using the percentage that goes well with their financial situation.

That's exactly why I said 'it all depends on which split works best for you' you absolutely don't have to follow the percentages I mentioned, I just gave those as an example to show that the split doesn't have to be equal for everything, if you want them to be equal then that's your choice and that's what will work for you, if sn equal split won't work for you then you split it however way will work for you, that's just what the 3 way split is about, you cannot decide that because you want to invest in bitcoin you don't have any need for an emergency fund and decide to neglect it and your discretionary spendings too because you want to buy bitcoin as aggressively as possible, you won't be able to sustain it because at the end of the day your discretionary spendings will have to be satisfied and the importance of the emergency fund can not be ignored.

[Cossyblack]

Your points are confusing here, @Cgrexp.  Mere disorganization should not stop any bitcoin newbie from being able to start buying bitcoin if they have discretionary funds.  And, yeah, there are abilities to learn from practice, which is a good justification to get started buying bitcoin as soon as a person realizes that he has discretionary funds, and surely newbies may well have to moderate their beginning position size based on their lack of organization, lack of knowledge, lack of skills, but they can use their best judgement to get started slowly and have bitcoin as an excuse to improve themselves in the various areas that they might already realize that they are lacking.

That's the point, because what we only need to invest in bitcoin is just our discretionary fund. Once you are able to figure out that you have discretionary fund available then you are good to go. A newbies doesn't need to know much about bitcoin before he can get started as it could delay him from starting his bitcoin investment. Some newbies make this mistake that they need to save a lot money or know everything about bitcoin before they can get started. Bitcoin investment isn't expensive and it's not difficult to start because even as low as $10 of discretionary fund you can be able to invest in bitcoin. The most important thing is to get started first, whatever that you didn't know before can be learn while you are investing.

[oll]

I think you are confused if you  treat  discretionary income as money that must all be invested. Because it doesn't work that way.

For example if someone has $100 left after paying their essentials, that $100 is discretionary money, but they can decide how to use it they could put $20 into Bitcoin, keep $50 for savings or an emergency fund, and use the rest for other need as backup fund in case of unexpected emergencies

Though putting the entire $100 into Bitcoin may be unwise if there is no cash cushion. But that doesn't mean the $100 wasn't discretionary income. Discretionary income is money left after essential  how you divide that money between Bitcoin, savings, emergency funds and other purposes is a matter of money management.

It seems to me that, aside from investing discretionary income in Bitcoin and building up a reserve fund, there shouldn't be any money left over for anything else. After all, if an investor allocates only 20% of their discretionary income to Bitcoin, their accumulation progress might be too slow. I’m not advocating for financial recklessness, but what is the point of holding onto cash after investing in Bitcoin via DCA and topping up the reserve fund (assuming one is even needed)? Sometimes I think we need to be more decisive in our investing—life moves faster than we realize—and if someone with a good income invests very little, they really ought to re-evaluate their needs.

[Princess Leah]

Your points are confusing here, @Cgrexp.  Mere disorganization should not stop any bitcoin newbie from being able to start buying bitcoin if they have discretionary funds.  And, yeah, there are abilities to learn from practice, which is a good justification to get started buying bitcoin as soon as a person realizes that he has discretionary funds, and surely newbies may well have to moderate their beginning position size based on their lack of organization, lack of knowledge, lack of skills, but they can use their best judgement to get started slowly and have bitcoin as an excuse to improve themselves in the various areas that they might already realize that they are lacking.

That's the point, because what we only need to invest in bitcoin is just our discretionary fund. Once you are able to figure out that you have discretionary fund available then you are good to go. A newbies doesn't need to know much about bitcoin before he can get started as it could delay him from starting his bitcoin investment. Some newbies make this mistake that they need to save a lot money or know everything about bitcoin before they can get started. Bitcoin investment isn't expensive and it's not difficult to start because even as low as $10 of discretionary fund you can be able to invest in bitcoin. The most important thing is to get started first, whatever that you didn't know before can be learn while you are investing.

The only thing that can stop someone from buying is being unable to generate a discretionary income which is almost rare cause even if someone doesn't have a job, a discretionary income can be gotten through money gift or won lottery and so, maybe sustaining it could be the issue that's why am confused at the excuse that disorganization would stop someone from buying Bitcoin.

 The person who said that is ignorant else he would aware that the discretionary fund is what's needed to buy and not too much and knowledge of the investment. Many people have delayed starting because of excuses like these, especially being a low income earner with many responsibilities but it still doesn't stop people like that from investing.

[Razmirraz]

Snip.

That's the point, because what we only need to invest in bitcoin is just our discretionary fund. Once you are able to figure out that you have discretionary fund available then you are good to go. A newbies doesn't need to know much about bitcoin before he can get started as it could delay him from starting his bitcoin investment. Some newbies make this mistake that they need to save a lot money or know everything about bitcoin before they can get started. Bitcoin investment isn't expensive and it's not difficult to start because even as low as $10 of discretionary fund you can be able to invest in bitcoin. The most important thing is to get started first, whatever that you didn't know before can be learn while you are investing.

Yes, all you need to invest in Bitcoin is "cold money", once you have that money set aside, you can start investing in Bitcoin. Beginners don't need to wait until they understand everything before starting, waiting only delays investment, and in the end, they might never actually begin.
Many beginners think they need $1,000 and must understand everything about Bitcoin first. That’s a misconception.
A capital of just $10 is enough to get started. The method is actually very simple, they just need to use discretionary funds to practice DCA regularly and then hold the investment for the long term. They can gradually learn the ins and outs along the way.

[Abbatty]

Your points are confusing here, @Cgrexp.  Mere disorganization should not stop any bitcoin newbie from being able to start buying bitcoin if they have discretionary funds.  And, yeah, there are abilities to learn from practice, which is a good justification to get started buying bitcoin as soon as a person realizes that he has discretionary funds, and surely newbies may well have to moderate their beginning position size based on their lack of organization, lack of knowledge, lack of skills, but they can use their best judgement to get started slowly and have bitcoin as an excuse to improve themselves in the various areas that they might already realize that they are lacking.

That's the point, because what we only need to invest in bitcoin is just our discretionary fund. Once you are able to figure out that you have discretionary fund available then you are good to go. A newbies doesn't need to know much about bitcoin before he can get started as it could delay him from starting his bitcoin investment. Some newbies make this mistake that they need to save a lot money or know everything about bitcoin before they can get started. Bitcoin investment isn't expensive and it's not difficult to start because even as low as $10 of discretionary fund you can be able to invest in bitcoin. The most important thing is to get started first, whatever that you didn't know before can be learn while you are investing.

The only thing that can stop someone from buying is being unable to generate a discretionary income which is almost rare cause even if someone doesn't have a job, a discretionary income can be gotten through money gift or won lottery and so, maybe sustaining it could be the issue that's why am confused at the excuse that disorganization would stop someone from buying Bitcoin.

 The person who said that is ignorant else he would aware that the discretionary fund is what's needed to buy and not too much and knowledge of the investment. Many people have delayed starting because of excuses like these, especially being a low income earner with many responsibilities but it still doesn't stop people like that from investing.

Well a person without a job is a person without income, and a person without income is a person with a lot of financial problems. So even if at the end he receives cash gifts, it would be hard for the person to generates discretionary income, because he has piles of financial problems. So advisable, if you want to get involve in Bitcoin investment, getting a job is very necessary, with that you will have discretionary income and you will remain consistent with your investment.

Starting a bitcoin journey is one thing and being consistent is another. With a job a person will never be consistent with his accumulation. A person can never depends on monetary gifts, lottery to keep running it portfolio. 

[Cossyblack]

Yes, all you need to invest in Bitcoin is "cold money", once you have that money set aside, you can start investing in Bitcoin. Beginners don't need to wait until they understand everything before starting, waiting only delays investment, and in the end, they might never actually begin.
Many beginners think they need $1,000 and must understand everything about Bitcoin first. That’s a misconception.
A capital of just $10 is enough to get started. The method is actually very simple, they just need to use discretionary funds to practice DCA regularly and then hold the investment for the long term. They can gradually learn the ins and outs along the way.

Mate, you re sound a little bit confused and your points are complicating.  Firstly,you wrote in your first paragraph that all we need to invest in bitcoin is 'Cold money ' which is wrong. And then you wrote that investor just need to use discretionary income to invest in bitcoin. doesn't these sound complicating to you? And it is very misleading too.
Furthermore,I will explain what cold money is. Cold money is that money that is readily at hand or available which could be your income. And it's wrong to invest using your main income in bitcoin. Therefore using cold money to invest in bitcoin is a misconception because what Investors need to invest in bitcoin is just their discretionary income. I think you should go through your post again and make the necessary corrections because it could mislead newbies to start using their main income to invest in bitcoin.

[Ruttoshi]

Starting a bitcoin journey is one thing and being consistent is another. With a job a person will never be consistent with his accumulation. A person can never depends on monetary gifts, lottery to keep running it portfolio. 

I disagree with you that someone who won the lottery cannot be consistent with his bitcoin accumulation journey. Do you know how much it is when you win the jackpot. The money is far bigger than some persons monthly income that's consistent if you put all of them together for a year.

For me, I believe that someone who hit the jackpot can be consistent in his bitcoin accumulation for a given period of time if he chooses to invest 1/3 of that money into bitcoin by spreading it in several weeks till it's exhausted. He can also set up a business that will generate daily income for him and use his discretionary income from there to continue DCAing overtime.

You should also know that it's not everyone who has a job that has a discretionary income because some of them hardly meet up to their basic needs and monthly expenses. You can start your bitcoin investment and look for other means to increase your income in order to generate consistent discretionary income if your current job discretionary income isn't consistent.

[The Founding Titan]

At the end of the day any investor who doesn't know how much of his discretionary income to invest in bitcoin with should use the 3 way split, with this they can invest in bitcoin with 1/3 of their discretionary income, use another 1/3 for their emergency fund and the remaining 1/3 for their discretionary consumptions, this will help make it easier for them to allocate parts of their discretionary income to things they want to do with it.

You know, when it comes to discretionary income, I don’t think deciding how to allocate it really helps. So long as a person can set aside what he will invest, and also make provision for both emergency and reserve funds, he can chooses to do what he feels like. There are people who after investing, they have other activities to do, such as Casino gambling, gifting friends, or even donating. All these will be done by discretionary income. So an investor just need to make sure he his doing well by his investment and making sure they are protected, after that he can do what he pleases.

A lot of us have life outside bitcoin investment, and we also have activities that will be done with discretionary income. So keep consistent with your investment, protect your investment with both emergency and reserve funds and live your best life out there mate.

The things you pointed out all falls under your discretionary income but there are not your investment or your emergency fund so that means there is only other one category for them and to be sincere they are all part of your discretionary consumptions so a 3 way split won't hinder you from spending your discretionary income on these things but actually allows you to allocate whatever percentage you want to them from your discretionary income.

But the real question here is, does the person understand what is discretionary money? Suppose someone has $100 in their hand after paying for necessary expenses, but that is their entire cash balance and there is nothing else to use in case of an unexpected expense in the next two weeks. Then you can't just put the entire $100 in Bitcoin and say that it was discretionary income. Part of common sense is to have some cash cushion and not buy Bitcoin in a way that will cause problems if the slightest expense increase. If you have discretionary income, there is no need for much preparation, but you should not invest in a financial reckless way. And I agree with you. If $10 is your reasonable starting amount, then there is no problem in starting with $10. Later, when income, discretionary funds and cashflow are strong, the amount can be increased.

Don’t get yourself confused, if after spending on all necessary needs and want and a folk have $100, that his/her discretionary income, and the person can decide if to invest all on bitcoin or if he can invest just a little and from there he can decide to build both emergency and reserve funds, but it a matter of how he wants to do it.

So it not a matter of common sense but preference. All investment have a certain target so some might give themselves a certain timeframe to reach such target, so investing little by little might not be the way for some people.

I think the real distinction is between discretionary income and money you can afford to risk. Having $100 left after expenses doesn’t automatically mean the full $100 should go into Bitcoin. A solid approach is to protect your cash buffer first, then invest what you genuinely won’t need soon.
Small, consistent buys can build discipline, while larger buys may make sense when cash flow and reserves are strong. The goal shouldn’t just be reaching a target—it’s reaching it without putting yourself under financial pressure. That balance is where the real strategy lies.

At the end of the day any investor who doesn't know how much of his discretionary income to invest in bitcoin with should use the 3 way split, with this they can invest in bitcoin with 1/3 of their discretionary income, use another 1/3 for their emergency fund and the remaining 1/3 for their discretionary consumptions, this will help make it easier for them to allocate parts of their discretionary income to things they want to do with it.

Anyone who is able to figure out their discretionary income should be able to know the amount that will be reasonable and convenient for them unless they decide to be overly aggressive about it which may affect them later if they continue to be over aggressive. This 1/3 method you are talking about can not work for everyone and it is not written anywhere that it is very convenient because everyone discretionary income are not the same, the most important thing is using what is convenient.

Even more reason why you should use the 3 way split so that you don't unintentionally spend more or your discretionary income on one thing and ignore the other so even though you seem to be trying to disagree with the 3 way split you are actually giving it even more credibility, you find out which split is convenient for you and you use that one, this way you don't end up spending more of your discretionary income on one thing and ignoring the others.

[PERtua]

Your points are confusing here, @Cgrexp.  Mere disorganization should not stop any bitcoin newbie from being able to start buying bitcoin if they have discretionary funds.  And, yeah, there are abilities to learn from practice, which is a good justification to get started buying bitcoin as soon as a person realizes that he has discretionary funds, and surely newbies may well have to moderate their beginning position size based on their lack of organization, lack of knowledge, lack of skills, but they can use their best judgement to get started slowly and have bitcoin as an excuse to improve themselves in the various areas that they might already realize that they are lacking.

That's the point, because what we only need to invest in bitcoin is just our discretionary fund. Once you are able to figure out that you have discretionary fund available then you are good to go. A newbies doesn't need to know much about bitcoin before he can get started as it could delay him from starting his bitcoin investment. Some newbies make this mistake that they need to save a lot money or know everything about bitcoin before they can get started. Bitcoin investment isn't expensive and it's not difficult to start because even as low as $10 of discretionary fund you can be able to invest in bitcoin. The most important thing is to get started first, whatever that you didn't know before can be learn while you are investing.

I agree to what is being said here. If you are new to Bitcoin, you shouldn't know everything about the cryptocurrencies before investing. If they do have some money that they can spend, it's okay to dip your toes in the water with a small bit to get a feel for it before committing to a large purchase. The secret is not to rush or invest funds which they actually need. It would be easier to get started and build up, and keep going, than to feel 100% ready to go.

[Abbatty]

Starting a bitcoin journey is one thing and being consistent is another. With a job a person will never be consistent with his accumulation. A person can never depends on monetary gifts, lottery to keep running it portfolio. 

I disagree with you that someone who won the lottery cannot be consistent with his bitcoin accumulation journey. Do you know how much it is when you win the jackpot. The money is far bigger than some persons monthly income that's consistent if you put all of them together for a year.

For me, I believe that someone who hit the jackpot can be consistent in his bitcoin accumulation for a given period of time if he chooses to invest 1/3 of that money into bitcoin by spreading it in several weeks till it's exhausted. He can also set up a business that will generate daily income for him and use his discretionary income from there to continue DCAing overtime.

You should also know that it's not everyone who has a job that has a discretionary income because some of them hardly meet up to their basic needs and monthly expenses. You can start your bitcoin investment and look for other means to increase your income in order to generate consistent discretionary income if your current job discretionary income isn't consistent.

When it comes to a case of lottery winning or hitting a jackpot it is consider to be under lum sum. You need a consistent income to be able to be consistent in your investment. This is thread that is encouraging everyone to invest in bitcoin, so will all these people be waiting to hit a lottery to begin their bitcoin journey. You can’t bank on lottery winning or jackpot to kickstart your journey.

In a case where someone have a job and it not enough to get a discretionary income, such person is advice to get a more playing job so he can have a discretionary income, with that he can start his bitcoin journey, but until so such person cannot start investing.

[Zackz5000]

Splitting one's discretionary cash into three may be a thumb rule but not one you have to blindly stick to. Ideally, I'd feel it is important to build up an emergency fund first, before taking major investment bets.

It is not composary to follow that rule exactly, but it is essential to have a clear financial plan, an emergency fund is very essential when investing in Bitcoin, but I don't think it is necessary to build up an emergency fund first before starting your bitcoin accumulation journey.

You can start your bitcoin accumulation journey, without having an emergency fund, what need to do is to build your emergency fund along side your bitcoin investment, waiting to build up an emergency fund first before you start investing in Bitcoin may delay your investment journey and you might also miss some buying opportunities in the process.

Yes instead of waiting to raise an emergency funds there by delaying your investment it will be better to get started immediately if you have your discretionary income first, emergency funds is important but it doesn't mean if you have it yet that you can't start accumulating Bitcoin, you can start investing and gradually think of how you can raise your emergency funds too through your discretionary income so you don't miss out more buying opportunity while waiting to ha have your emergency funds at first. What i see that is compulsory to get started with our Bitcoin investment is our discretionary income while other funds can come later as you are consistently and persistently accumulating Bitcoin.