If peradventure the investor has already accumulated a large stash of Bitcoin and is much closer to his accumulation target, such an investor can choose to only buy dips and continue holding while he keeps edging closer to his accumulation target.
I dont see any reason why one should to sieze to accumulate bitcoin because they are close to their time of accumulation. Is it that getting close to ones accumulation means quit or goodbye to accumulation of Bitcoin? I think if you one have plans of taking out their bitcoin because enough have been accumulated, DCA strategy of investing can still continue. For the fact that one has been able to accumulate bitcoin successfully is a reason to still continue even if they are close to the time of their accumulation. Investing bitcoin is a continuous process ecen if you have been able to reach your goal of accumulation.
You might need to provide more specifics @Sobz if you are of belief that guys cannot graduate out of their bitcoin accumulation stage.
Each of us is limited in time, and we have differing life situations that likely help us to construct goals that are tailored to our personal circumstances.
Give some kind of an example.
Maybe you, personally, are so far away from being able to reach enough or more than enough bitcoin that you cannot imagine that anyone else could accomplish such.
How much bitcoin are you imagining a person to be able to accumulate in terms of their income? You should be able to concede that there are differences in results in regards to a person on the higher end of a 5% to 25% range as compared with a person at the lower end of that range.
What kind of age and health does the person have? Do they want o continue with a similar life standard or do they have goals within that or do they have unlimited goals (which seems a bit self-imposed conditions of never going to get there).
You could start with an example of a person who is in their mid-30s, with an annual income of $30k, expenses of $1,500 per month who had already been investing at around 17% of his income per year for the past 10-ish years and maybe he is just coming to bitcoin or you could even describe him as already having had been in bitcoin for some time. Your own timeline registered on the forum is slightly more than 3 years.
First, it is necessary to consider whether that discretionary income can really be invested or if there are future expenses, urgent needs, or family responsibilities. Of course, there are some people who, when they see a price drop, think that if they cannot buy more now, the opportunity will be gone.
Am really disappointed in you because you have been in the forum since 2021 but you are not learning. You are not even aware that investment in Bitcoin is best made with our discretionary income, which is the funds that is left, after all our basic expenses have been made, so you shouldn't be talking about other responsibilities, if you have truly sorted them out.
Emergency needs are taken care of with your emergency funds that is kept aside from your discretionary income, with the aim of protecting your investment against any real life emergencies, so try to learn fast so that you wouldn't misled newbies .
The thing is not everyone understands what discretionary income is all about. Many people think that your discretionary income is money left after your basic expenses. They fail to realise that discretionary income is the money after budgeting for every expenses including unforseen expenses that cover emergency funds too.
Your framing is confusing @Comeacross. Emergency funds is not part of basic expenses, but instead emergency funds are built up from discretionary funds, and with the passage of time, the emergency funds can be built up, yet they might not be built up every pay period. It is in the discretion of the person choosing how much of their discretionary funds they are going use each pay period to put into their investment, savings (emergency funds) and/or to discretionarily consume.
If you only budget for basic needs and assume the remaining money is your discretionary income, then you're only gambling
You are wrong. Emergency funds do not have a higher priority than other ways of using discretionary funds. Emergency funds are not the same as basic expenses.
I will grant you that a person likely has to have a bare basic quantity of back up funds left over in order yto even know if they have enough money to be able to pay for all of their basic expenses before the time that they are next paid.
Think about it. Basic expenses are those that need to be taken care of on a regular basis, such as daily for things like food, or weekly or monthly for things like housing and utilities. There are some ways that basic expenses might be paced out, and a person who has been paying for his basic expenses on a regular basis and even earning a regular income may already have some practice in place to make sure that they have enough money to cover all of their basic expenses, and they might already have a practice of keeping some extra cash on hand in order to attempt to account for variability in their income and/or variability in their expenses, so that they always have enough money to cover their basic expenses.. and so having the extra money to cover variation in basic expenses still does not rise to the same level of basic expenses, since the money that is held is extra and it can build up over time as long as the income is greater than the basic expenses.. and so maybe you are making the whole matter more confusing than it needs to be in terms of differentiating between kinds of expenses that a person might have and also once it can be assessed that basic expenses are taken care of then the extra money is discretionary money.
because the discretionary income might become a money needed for other responsibilities.
Sure. You can describe the differences between needs and wants, and if discretionary money is completely depleted, then there could be questions about if enough money is available in order to be able to make it until the next time pay is supposed to be received.
Even if guys can do all kinds of dumb shit with their money, it seems that in this thread we are trying to figure out ways to manage our money and even to describe the managing of our money (including putting it into categories) in order to attempt to show limitations and in order to figure out how aggressive that we might be able to be in the ways that we are using our discretionary funds, and likely if we are not organized then we might not be able to distinguish between our pushing limits or our going over limits without realizing that we are going over limits.
We do not need to emphasize or draw attention to dumb shit that guys do, especially if we might have goals to participate in threads like this one in order to try to improve our abilities to buy bitcoin on a regular basis and at the same time figuring out ways to strengthen our cashflow management systems/practices and at the same time figuring out ways to talk about these ideas so that we might get better at what we are doing and/or planning to do.
The reality is, not everyone actually has discretionary income yet, what they have is assumption of discretionary income and that's why many people struggle to hold for a longer term because what they are investing with is not actually a discretionary income.
Of course, you seem to recognize that if you don't have discretionary income, then you cannot invest in bitcoin (and you cannot buy it either since it is not good to trade or gamble with bitcoin).
If you want to invest in bitcoin and you are not sure if you have discretionary funds, you need to figure out how to increase your discretionary income by increasing your income and/or cutting your expenses... and surely there are guys who get so excited or even desperate in their wanting to improve their financial circumstances, yet if they are buying bitcoin with money that they need for their basic expenses or they are using money that they need to hold for potential future basic expenses into the foreseeable future, then they likely do not have enough money to be buying bitcoin.. and many of us, including yours truly, do not recommend trading and/or gambling with bitcoin since it may well end up making the person's situation worse to be managing their cash in those kinds of ways when their discretionary funds are not large enough to be able to buy bitcoin and even to be able to hold that value in bitcoin for 4-10 years or longer... which is the investment timeline for bitcoin.
Yeah he’s got it all wrong and mixed up, the discretionary income is used for investing but that doesn’t mean you should invest all of it unless you have already have a substantial backup funds then you can afford to be 100% aggressive into bitcoin.
To make one slight correction on your part @Big Dirams; Discretionary income isn’t just free money or extra money without any responsibility because it has it’s own responsibilities. As you use your main income to satisfy your needs your discretionary income satisfies your wants. It is used to invest, save and/or discretionary spend.
I do not see anything wrong if someone decides to go all in with their discretionary income if they have or sees an opportunity to do that, since the job of the discretionary is to invest so there is nothing wrong because you will still grow another one from your source of income. discretionary income is an extra cash, a leftover cash, remaining cash after all needs must have been taken care of but yea, this does not mean it is not useful of course it is very useful yet it is someone that will make it to be this useful because there are people who make their discretionary income look useless by using it wrongly.
It is problematic if guys think that they can put all of their discretionary income into buying bitcoin. They should be thinking about savings and discretionary consumption too.. so if they are ongoingly allocating zero to savings and/or discretionary consumption and putting all of their discretionary funds into buying bitcoin, they seem to be gambling and engaging in too much risk, even if it is their choice in terms of how to use their discretionary funds.
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You literally mixing things up here, the definition of discretionary income with that of a budgeting strategy. By the definition in finance, discretionary income is the money that is left after all your basic necessities, living costs, and short term obligations ( including emergency savings) are taken care of.
Read more : https://www.investopedia.com/terms/d/discretionaryincome.aspIn the aspect we’re you are taking money out of your discretionary income to build up your emergency fund than that money was never a discretionary in the first place. It was essential financial obligation.
For your 3 part split strategy, it fine to allocate leftover cash. But calling money discretionary before your emergency cushion is built that really dangerous. Once a real life emergency happens and you haven’t built up your cash fund yet, you are going to be forced to dump your Bitcoin at a loss to pay for it. A safety net first then a true discretionary stacking.
It is confusing what you are saying @Sammysmart001.
Emergency funds are built from discretionary funds, they are not part of basic expenses.
if you want to go fuck off and get caught up in discussions of what investopedia says, then you are likely going to get lost in the ways that we are talking about bitcoin investing and how to go about it.
Frequently we talk about building up bitcoin and back up funds at the same time, and if you are staring out with zero back up funds, then you likely need a bare minimum of back up funds to get started to buy bitcoin, since the main thing in getting started with bitcoin investing is to make sure that you are investing from your discretionary funds, and if you have absolutely no back up funds, then you cannot be sure that you would be using discretionary funds to buy bitcoin.
In this thread, we are not talking about building an emergency fund first, so you can go fuck off with that nonsense, but we are talking about making sure that you get started and making sure that you are investing with discretionary funds.
it can take a long ass time to build up back up funds and also build up bitcoin holdings, depending on what kind of discretionary fund levels a bitcoin newbie has...so let's get it straight. Back up funds are built up from discretionary funds. Back up funds are not part of basic expenses, unless a person has such small levels of back up funds that he cannot be certain if he has enough funds to cover all of his expenses, then most guys are going to have to have a certain level of back up funds, perhaps one or two weeks of their expenses, and surely if a guy has a regular and reliable income, then he might end up operating without hardly any back up funds, yet if he is wanting to get into bitcoin investing (which happens to be the topic of this thread) then he his likely going to need to be more purposeful in terms of the building of his back up funds so that he can both protect his bitcoin and also to make sure that he always has enough funds to cover all of his expenses so that he does not have to tap into his bitcoin at a time that is not of his choosing.. .which we consider bitcoin investments to have 4-10 year or more timelines, and less than 4 years is trading and gambling rather than investing. In this thread, we do not recommend trading/gambling with bitcoin.
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I understand your concern but the definition of discretionary income and how much of it should actually be invested depend on the financial situation of the person investing in Bitcoin. What is left after the emergency fund alocation is not called discretionary income. Rather, the money left over after current basic and essential expenses and the necessary float from income is discretionary funds. Then those discretionary funds are allocated for Bitcoin investment, emergency and reserve funds, and some additional expenses. And so the problem you are describing is really we can related . But its solution is not to change the definition of discretionary income. The problem is that many people think that having $200 discretionary means that the entire $200 is investable . but it is not right planning .
Suppose someone has income $1000 which come regularly. That person essential expenses of $600, and a fiat savings or other regular bills $200 to cover. Then his discretionary fund is $200.
Holy fucking shit, @Saltysugar99. You seemed to have had said everything correct, but then when you gave your example, you fucked it up. Maybe we should require all guys to give examples in this thread so that they can show the extent that they understand what they are talking about.
In your above example. Your $600 for personal essential expenses seems to be various basic expenses.. perhaps food and things like that?.. so o.k. That seems good. in your second example you describe either fiat savings or other regular bills as $200 and yeah, maybe regular bills are housing and utilities.. but fiat savings is not basic expenses. fiat savings is part of emergency funds, reserve funds.. so you are wrong if you are taking that out and including it as basic expenses.
From your example, I cannot exactly tell what you mean by basic expenses, and so I will concede that each guy can end up fucking up what he considers to be basic expenses versus discretionary expenses - the difference between needs and wants.
For sure there is some overlap in the categories of needs versus wants, and certain bills have to be paid and they cannot be deferred and so they would be part of basic expenses.
Money that is used to build up cash savings are not part of basic expenses unless they are just like floating funds that are kept to make sure that enough money is available for all basic expenses, so let's say for example, each month there are a couple of bills related to utilities that are not known in advance, and they tend to be somewhere between $40 and $120 each month, and so at the beginning of the month, the guy might hang onto the whole $120 in cash, just to make sure that he has enough cash to cover the bill when it comes in, yet if the bill ends up coming in at $65, then he will have $55 that he is able to put into his discretionary funds, once the biill amount is resolved to have had been $65.
But that doesn't mean that $200 should be invested in Bitcoin. He might buy Bitcoin with $100 and build a $50 backup fund if he has already back up then no need to allocate for back up. and keep $50 for extra expenses. But you're right which is that many people don't identify their expenses properly, and this is where fake discretionary income is created.
I think that a better example is that some guys might have some expenses (such as luxury food or even treats or even cigarrettes) that they count as basic expenses that are really discretionary expenses.
Although this may happen to very few people. Because a conscious and with common sense person has the ability to understand that. he can give a little time to calculated then he can identify which fund should be allocated to which expense.
As you seem to be suggesting, I think that practice makes guys better in regards to how they are treating their various expenses and any extra funds that they might save up to cover future expenses..
