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I know this question was not directed at me, but I would like to share my own view on it. When it comes to preparation and how much time someone needs before getting started, I think it really boils down to two major things.
First is the person’s financial status or financial strength.I feel this is very important. Not everyone today is financially stable or has their finances in order. A lot of people are still struggling, trying to survive, and barely earning enough to cover basic needs, let alone have steady discretionary income.
So even if that person is genuinely interested in Bitcoin and really wants to go all in, realistically, their financial situation may not allow that yet. They would obviously need some time to first improve their income stream or fix their finances to a reasonable level (not necessarily perfect) before Bitcoin can even become a serious point of focus for them.
I also remember clearly when you spoke about your own journey, how you already had your finances under control before getting into Bitcoin. You mentioned investing in different assets for over 20 years before Bitcoin even came into the picture. I believe that financial stability gave you a huge edge and reduced the amount of preparation you needed when you finally started.
The second factor is the person financial or investment intellect.This also is important and can slow someone down. We can all agree that it is not wise to jump into any investment you have no knowledge of.
For example, let’s say if Mr. A wants to invest in Bitcoin with him having a long term plan of like 10–20 years, it would be smart for him to take some time to understand what he is getting into. There is a saying that “the 10% effort you put into understanding something will save you 90% of the effort later.” Someone with no knowledge at all definitely needs time to prepare and learn.
And I am sure you yourself already had good knowledge about investing in particular and Bitcoin, before you started Bitcoin investment. I feel without that foundation, it would have been difficult to achieve the level of success you did in your investments with Bitcoin..
Now, the main question:
Is it a few hours? A few days? A few weeks? A few months? A year? Or something else entirely?
My answer is this: it completely depends on the individual’s ability and seriousness, considering those two factors I mentioned. But if someone already has their finances fairly sorted and has a fair level of investment (Bitcoin) knowledge, then they do not really need a long preparation period, they can start immediately..
You are not wrong with any of your analysis gracreavix, yet you still seem to be putting quite a bit of emphasis in comfort level prior to getting started, yet it seems to me as long as a person is able to figure out that he has discretionary funds and
he can assess that he has common sense, then why can't he get started right away? He can adjust his starting size to a small enough amount as he works out his finances and his comfort. In other words, I don't see any reason to delay based on feelings of lack of comfort, since a person with common sense should be able to figure out what he knows and what he does not know and maybe within an hour or two, if he can do a ballpark assessment of his finances and his discretionary income situation, maybe he comes to a tentative conclusion that he has enough income to start investing $100 per week right away... yet based on his lack of familiarity with the matter, then he could purposefully reduce his starting amount down to $30 per week while he looks into various matters, including figuring out his understanding of where he is at in regards to his
9 personal factors.
By the way, a beginner investor into bitcoin does not need to know his 9 personal factors before getting started investing in bitcoin even though once he gets started investing in bitcoin, he may well need to study into various matters including but not limited to his 9 individual factors in order to increase his level of comfort, and perhaps if he started investing at $30 per week, then maybe after a couple of months, he might be able to move his amount up to $60 per week or maybe even higher.. depending on the extent to which he continues to have various reservations in regards to his 9 factors.
How much emergency funds (or back up funds) do you think is needed before getting started?
If someone already has a source of income ,I don’t really see a reason why they must first finish building emergency funds before starting, once they can properly separate their discretionary income from their essential expenses, there is no real need to delay just to build emergency funds first.
it is better and advisable for someone in that position to build emergency funds and invest at the same time, both of them could also grow well with same energy.
That is a great strategy but for people who have job security, like people who do Government Jobs. This strategy fits them and other people whose income is passive and stable but people who work in a private sector or do not have job security then they should first eliminate the risk by saving an emergency first for incase something goes wrong and they need money all of a sudden, we can also incorporate "your" strategy after saving a small amount of emergency fund first. Then start investing meanwhile also saving up an emergency fund.
You are correct that a person who has more unstable income and/or expense, then that person likely needs greater amounts of back up funds in order to make sure that they do not run out of money.
Yet at the same time, when a person first hears about bitcoin, they already have a practice of keeping back up funds. perhaps they already keep anywhere between 2 weeks and 6 weeks of cash in case they have issues with loss of income and/or increased expenses.
There likely is no reason to drastically change their past practice and to delay their getting started investing in bitcoin merely because they are getting started investing in bitcoin... So even a person with 3-4 weeks of expenses already saved up, he does not need to increase his quantity of back up funds, merely because he is starting to invest in bitcoin. He could just get started right away and invest into his back up funds and bitcoin at the same rate.
Now if a person already has absolutely no back up funds, then it would be a bit retarded for them to put all of their extra money into bitcoin without having any back up funds.. .
Let's say for example a person has an income that varies between $600 and $1.5k per month and he has expenses of around $800 per month. So then the question might be how much extra money does he have. If he has absolutely no back up funds, and he is ONLY paid once a month, and then if his pay comes in and he receives $1.2k, then he can set aside the $800 for his expenses and he has $400 that is remaining. Perhaps he can invest $133, save $133 and consume $133? perhaps he can do some other amount, yet I doubt that there is any reason to delay getting started investing in bitcoin if he can figure out that he has discretionary funds available.
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These two strategies make many people really think twice about determining job security. I agree that what you said is quite true. For some people who have jobs, such as those under government auspices, their income is always stable and passive, so they seem to no longer need an emergency fund because of the stability of their achievements. With this kind of income, it's certainly very easy for them to start investing with the goal of saving long-term only to generate profits in the future.
Different things should be done for those who work without any guarantee so that they really need a strategy with the reason to avoid what is called risk because the main reason someone accepts risk is of course because the income is very lacking, especially the funds saved as a tool when something like this happens are not sufficient according to needs. This is because the passive income they have makes someone have to lose many small things which are used as the main factor in the form of mistakes.
Everyone needs back up funds, even if they work for the government and/or they have strong confidence in their being paid.
Government income from work is not passive. Government benefits might be passive, yet even government benefits are not necessarily guaranteed to arrive.. and income is ONLY 1 side of the formula for figuring out discretionary funds (there are expenses that have to be considered, too).
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To answer the question of how much emergency funds that is needed before starting Bitcoin accumulation, is to say that there's no need for Bitcoin investment at all because emergency is an unexpected happening that you can't detect how much will be required.
For there to be emergency funds, probably discretionary funds would have also been piling up. Or what sense does it make that emergency funds is piling and there's no discretionary funds? Of course it makes no sense. So no waiting to keep emergency funds first before getting started in Bitcoin investment.
You make little sense Obulis.
Back up funds (including emergency funds) are built up from discretionary funds. Surely a person who is brand new to investing can build up their back up funds and their bitcoin investment at the same time, yet no one should be investing into bitcoin without some amount of back up funds in order to assure that they have enough money to cover any expenses until the next time that they are paid.
I would think that it is good to at minimum build up back up funds at a similar level that the bitcoin investment is being built up until the back up funds and the amount invested into bitcoin are around 3 months of expenses.... yet there is flexibility in regards to how much back up funds to have and how much balance exists in regards to both the back up funds and the amount put into bitcoin (bitcoin prices fluctuate, too).
Guys can do whatever they like, yet if they make mistakes of not having enough back up funds or even choosing to under invest in bitcoin and put such money in their back up funds, then they have to live with the results of the balancing choices that they had chosen to put into practice, whether they end up having little to no bitcoin or whether they end up having to tap into their bitcoin at a time that was not of their choosing (or to their benefit), they might end up contributing to their own screw ups in relation to bitcoin, so they would have to live with the consequences of their implementation of the practices that they chose to do.
A good default position is just to grow both of them at the same rate until they each reach 3 months of your expenses, and the one you reach 3 months of your expenses in each, then you likely have more flexibility and even more investment security at that point. Of course, you have the free will and discretion to adapt your amounts to your own comfort levels, and there surely have been (and likely will continue to be) a lot of guys who fuck up their own bitcoin investments by their failure/refusal to strike balances that are sufficiently reasonable based on their own financial/psychological circumstances.. .and surely if the mistake is not very big, then they can learn from it, yet other times the mistake results in great losses and inabilities to recover.. .. so frequently each of us needs to practice with our own implementation of our bitcoin investment and cashflow management systems/practices in order to find a reasonable level of comfort that is also practical and fitting to our own particular circumstances.
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We will never truly be ready until we actually start so the more time we waste telling ourselves that we are getting prepared for something the more time we actually lose that we could have used to start, Harrison Ford is an amazing actor today with so many achievements but before all that he was a carpenter, he was literally working on people's furniture from books on how to do carpentry work, he did not let his lack of knowledge delay him, instead he learnt as he worked, this was achievable in carpentry so why do some many people think it's unrealistic to attempt the same with bitcoin? Why do they always assume that we need to learn so much first before we can start investing? When we can actually learn while investing at the same time,
bitcoin investment isn't rocket science and we don't really need all that much planning going into it before we can satisfactorily say the we are ready to start investing.
I would not proclaim bitcoin investing is easy.
Yet at the same time, as long as we have common sense and discretionary funds we can get started and to both learn all of the basic skills and putting the basic skills into practice, we can become very good at bitcoin and bitcoin investments as long as we are pacing ourselves and ongoingly trying to learn as we go without becoming too arrogant about our approach to bitcoin, since whatever we do is not guaranteed to result in success, yet at the same time, if we start out small and continue to work on improving ourselves and learning, then we likely are going to put ourselves in a better position for our having had gotten involved in bitcoin and started buying bitcoin as compared if we had not gotten involved in bitcoin.
Let's say for example, we hear about bitcoin, and we go to calculate our discretionary income, yet we are not really sure and we don't have a lot of confidence in our math skills. If we have common sense, then we will realize that we may welll need to learn and/or improve our math skills. Maybe we can figure out that it is possible to invest $100 per week, yet we are not sure. Maybe we decide to start out at $30 per week, and in the next several weeks we work on our math skills to make sure that we are calculating everything correctly. Maybe if we had not already learned math well enough, then we might have to figure out some ways to brush up on our math skills.
Bitcoin does not require high level math skills, yet it is understandable that some people might not have learned math very well, and they might need to brush up on their math skills and even go through some processes of trying to count how much money that they have coming in and then how much money they are spending in order to really have confidence that they are not buying bitcoin beyond their discretionary funds. Some people might have to practice for quite a bit of time, yet in the meantime, they still may well have a lot of confidence that they are not going to be harmed by $30 per week invested into bitcoin, yet if they want to be more aggressive, they figure that they have to learn a bit more math and basic accounting.. and they are doing this in order to be practical, since no one wants to lose money based on their own failures/refusals to hone up on the improvememnt of their basic skills.
At the same time, Bitcoin touches on a lot of areas, and in some ways bitcoin is complicated because it touches upon challenging our basic understandings in regards to what is money, and so bitcoin can become even potentially stressful in regards to its price movements and even some things that likely need to be learned in order to protect ourselves and even to self-custody the majority of the bitcoin holdings that we accumulate over the years.
At the same time, we do not need to get into specifics learning about bitcoin to get started, even though we might make sure that we do not overly invest from the start, and we start out slow as we are getting comfortable with our own cashflow management so that we can be comfortable investing in bitcoin and potentially increasing our weekly investment amounts.
We do not have to have high skill levels to start investing in bitcoin, yet if we want to be organized and protect ourselves, we likely will be continuing to learn about bitcoin to make sure that we are safeguarding the time, energy and value that we end up putting into bitcoin as compared with other places that we could have had invested our time, energy and value.
