Many people say “hold Bitcoin long term”, but forget about emergency funds

[Makus]

Just as the word emergency implies it is unexpected meaning that it can happen at anytime, which means that this is something that you should be prepared for if you want to start investing in Bitcoin but it is important to set out an emergency funds in order to avoid selling your coins when you haven't made profits yet but the main struggle with some people is that they don't have a source of income so that is the reason why they struggle to keep up with their investments. It is important not to start an investment without an emergency fund.

[Issa56]

Many people say “just hold Bitcoin for long term”, but I think one thing is often ignored: emergency money.

A reasonable person won’t be holding bitcoin without having emergency funds. Before you start investing, make sure you set aside emergency funds Incase if anything happens, you not going to sell your bitcoin, you going to take from the emergency funds sey aside. If you decide to invest everything into bitcoin, whenever there is emergency, you won’t have choice than to sell your bitcoin and make use of the money to take care of the emergency which came up. In whatsoever you are investing in, always make sure you have emergency funds, it’s not applicable to only bitcoin investment.

[LastKiss]

Many people say “just hold Bitcoin for long term”, but I think one thing is often ignored: emergency money.

Holding Bitcoin sounds easy when everything is fine. But when real life problems come, like rent, medical bills, family issue, job loss or urgent expenses, many people are forced to sell even if they never planned to sell. In that case the problem is not Bitcoin, but bad planning before buying.
~snip~

They tend to ignore it because emergencies don't happen very often, they think they can deal with an emergency when it eventually comes. The thing is, emergencies are unpredictable we never know when they'll happen and how much money we need to solve it so when people talk about holding Bitcoin or other assets like gold or stocks for the long term, they should also prioritize an emergency fund before investing.

Not many people are disciplined enough to do that because developing that kind of financial discipline doesn't happen overnight. It takes time and consistency, personally this thread reminded me about my emergency fund, which I haven't touched it for a long time because nothing unexpected has happened to me recently. I think whenever we talk or hang out with friends and discuss investing it's a good idea to remind each other about the important of having an emergency fund, just in case we've forgotten to prepare it.

[Leahized]

Just as the word emergency implies it is unexpected meaning that it can happen at anytime, which means that this is something that you should be prepared for if you want to start investing in Bitcoin but it is important to set out an emergency funds in order to avoid selling your coins when you haven't made profits yet but the main struggle with some people is that they don't have a source of income so that is the reason why they struggle to keep up with their investments. It is important not to start an investment without an emergency fund.

If you don't take immediate precautions in investing in Bitcoin, you may face good problems later on. I have faced this problem many times. It even had to raise money by selling bitcoins at a loss at times. But there is a very simple way to get rid of this problem. Firstly, the monthly income should be divided into three parts. Household and all expenses shall be borne by the first part. The second part is to be saved and used for investment. A third part should be saved for the emergency fund. I benefited a lot from this pattern and created no problems for investment. yes that's right, It's important to have a certain source of income before investing.

[Rockstarguy]

I will agree with you that many people think of investing in Bitcoin but they never think of an emergency fund. An emergency fund plays important roles in helping sustain the investment until the end of one's investment.

One of the reasons why people don't really consider an emergency fund when investing in Bitcoin is that they think the amount of Bitcoin they invest is not enough, leading them to believe that using all the discretionary funds they have is the best way to invest. However, I think people need to plan very well to make an emergency fund a priority while investing because every investor needs it, and one cannot completely do without it as you can never tell what will happen in the future.

[el kaka22]

You’re right about this but there some people can easily swayed of hype to commit a move like this. Some even gamble everything when they are influenced already by their desires of gaining profit.

It’s a common knowledge to invest only what you can afford to lose yet there’s always someone ignoring and choose to still risk because they are hoping that they will get profit just in time before they will use the fund.

That’s the time when an investment on Bitcoin always gone wrong.

I would say that emergency funds in other things aren't always lovely neither. People are acting as if investing into other things make it better and easier and more lovely, but how do you know others are good? Didn't gold fall from that peak? Didn't stocks crash in history? Didn't fiat lost value to inflation?

How are you so sure that if you do not invest into bitcoin with your emergency funds, whatever you put them into, won't be doing the same? Yes bitcoin is volatile, but how about others? Are they great and stable and make you rich? If there is an asset out there, who is not as volatile as bitcoin, and guarantees you to make money and not lose value, then let me know because nobody in the world knows about such a thing.

[Findingnemo]

Since when has rent become an emergency situation?

Medical bill can be compensated with a good health insurance so even ebfore start investing in bitcoin and saving for an emergency, just get a good health insurance so your life savings don't get wiped on a surgery.

[Asuspawer09]

I learned this the hard way when I was just getting started in crypto. I dont have a financial foundation because all of my funds are just invested straight into Bitcoin, without realizing the importance of these emergency funds or just having a financial foundation. Most of the time, when I need money, I would just easily sell my Bitcoin, forcing me to take a loss every time because I just don't have a choice, since all of my funds are invested.

It is really important to don't just straight up invest, investment is a great thing but what you need to do is to make sure that you are investing and saving in the right order, make sure to build your finances first before even investing, for me it is important to have savings, emergency funds etc. before even starting to investment because that is the main foundation of your finances, with that you are no longer going to be force to sell because you know that you always have the money and liquidity if you needed it.

[Cookdata]

This is why I think emergency fund and discretionary income are very connected. Before DCA or lump sum, people should first know what money is really free. Not money for food, rent, debt, family needs or short term bills.

So maybe the best Bitcoin strategy for normal people is not only buy and hold, but:

1. cover basic needs
2. keep some emergency backup if possible
3. use only real discretionary money for Bitcoin
4. hold without emotional pressure

Bitcoin rewards patience, but patience becomes very hard when you invested money that you may need next month.

And always remember, patience with a proper analysis usually pays off in the end.

I do hear about this discretionary funds alot within investors but if I'm to say what I have seen within my investment surrounding, people just invest the money they want, the people that has discretionary funds to Bitcoin are people that have steady passive income and regular flow of pay check which are mostly retail investors, the consumable investors don't think about discretionary funds, they buy Bitcoin with what they have and go all in.

Now the problem isn't even going in and using all you have to buy Bitcoin and left with nothing, if you made profit holding within that frame time, it's their luck but buying Bitcoin at high price and then later sold it for small amounts of money is diabolical. You have no business with buying and holding Bitcoin if you are going to spend it later or when you run into minor problems. I know about a guy that sold Bitcoin because he wanted to smoke, people are weird. 

[Crypto_Timothy]

Your emergency fund cannot just be seen as a safety net because it protects your investment strategy from being disrupted by life's unexpected events and thats something to take seriously. When you invest money you might need for essential expenses, you are more likely to sell during downturns not because Bitcoin has failed but because they have no other option, that is why the sequence matters: secure your essentials, maintain a financial buffer and then invest only what you can genuinely afford to leave untouched for years, and doing just so removes much of the emotional pressure that leads to panic selling and allows patience and sound analysis to work together over the long term otherwise you will find yourself struggling emotionally alot.

[jossiel]

Your emergency fund cannot just be seen as a safety net because it protects your investment strategy from being disrupted by life's unexpected events and thats something to take seriously.

It means protection so it's a safety net that has a different purpose from the usual financial matter that we have.

As it serves its purpose differently, there are times that whoever has it are also spending it to something that's unusual which shouldn't be for it.

An investor will protect their investments like bitcoin in the best way that they can and one of it is by not using the holding they have.

[junder]

I will agree with you that many people think of investing in Bitcoin but they never think of an emergency fund. An emergency fund plays important roles in helping sustain the investment until the end of one's investment.

One of the reasons why people don't really consider an emergency fund when investing in Bitcoin is that they think the amount of Bitcoin they invest is not enough, leading them to believe that using all the discretionary funds they have is the best way to invest. However, I think people need to plan very well to make an emergency fund a priority while investing because every investor needs it, and one cannot completely do without it as you can never tell what will happen in the future.

The role of emergency funds is not only to help investments stay afloat but basically we should be able to pay attention to this even if we don't invest, to be able to have emergency funds and other important points are money management because with that I think we can manage everything well but without money management then everything will fall apart even to meet the needs may be difficult.

[Fredomago]

Your emergency fund cannot just be seen as a safety net because it protects your investment strategy from being disrupted by life's unexpected events and thats something to take seriously.

It means protection so it's a safety net that has a different purpose from the usual financial matter that we have.

As it serves its purpose differently, there are times that whoever has it are also spending it to something that's unusual which shouldn't be for it.

An investor will protect their investments like bitcoin in the best way that they can and one of it is by not using the holding they have.

Yes, that's right there should be another saving for emergency funds that separated from your investment, like what OP mentioned Bitcoin investment can be rewarding but if you have limited amount of money and you use it for investment then suddenly emergency case happen it can be a loss since you need to pullout your investment to finance your needs, so the better appraoch is to make sure that the money you invested is well dedicated to this sole purpose and nothing else, to make sure that you are not going to touch it while you haven't reached your set targets.

[Swordsoffreedom]

Since when has rent become an emergency situation?

Medical bill can be compensated with a good health insurance so even ebfore start investing in bitcoin and saving for an emergency, just get a good health insurance so your life savings don't get wiped on a surgery.

Rent is not an emergency expense. It is more important than that. Rent is one of the basic necessities and should be a top priority in everyone's financial plan.

An emergency fund is not just for dealing with unexpected situations like medical expenses, illness, or accidents. It also helps us deal with other emergencies, such as job loss or unexpected financial difficulties affecting our family, not just ourselves...That is why an emergency fund is essential and everyone should have one.

[Zackz5000]

It can be easy to say but it will be difficult to hodl your Bitcoin for a long time without having an emergency funds, emergency funds is very important if you plan holding Bitcoin for a long time infact i see any body accumulating Bitcoin without having an emergency funds or plan of having any emergency funds as a gambler because a time will come when you will want to sell your Bitcoin just to solve an emergency funds situation when they hit you, an emergency can come anytime it will come unexpected, so when planning to start accumulating Bitcoin also plan on setting up an emergency funds.

[imthegreat]

Many people say “just hold Bitcoin for long term”, but I think one thing is often ignored: emergency money.

And always remember, patience with a proper analysis usually pays off in the end.

You've hit the nail on the head. Many are so eager to be investors here and now that they're ready to quickly gather all the money they feel they need and invest it in Bitcoin. So what's the catch?
The price of Bitcoin could fall even lower, and the second problem is that such an investor might suddenly need money—for repairs or health care. Then they'll withdraw those Bitcoins at a reduced price and spend it. But they did everything right—they calculated their entry point. The only problem is, they didn't keep some in cash or on a card in case of unforeseen circumstances.

[Dr.Bitcoin_Strange]

I do say this thing, the right knowledge of investing on Bitcoin will make the person to have a successful investment on Bitcoin, if someone already knows that Bitcoin is not a stable coin and that being profitable is based on holding for the long term, then the person would definitely know the best approach to use while investing, he or she would not invest all their earnings in Bitcoin but they will rather keep some fiat too knowing that emergencies could arise and they can not sell their Bitcoin at that point. So, to hold Bitcoin on the long term, you have to invest on the amount that you can be able to hold for that time period.

[Floxynice]

This knowledge is not only limited to Bitcoin investment alone. Everyone whether they are investors, business people or salary earners should have a reserve fund that they can fall back to in times of emergencies. Although in the case of bitcoin, bitcoin is very volatile which any form of careless withdrawal will result in losses.

It is not just about buying or investing in bitcoin, or starting any form of merchandise, if one must do so, he should plan himself. Nothing kills a business faster than this emergency drawings (withdrawals for personal use).

[Findingnemo]

Since when has rent become an emergency situation?

Medical bill can be compensated with a good health insurance so even ebfore start investing in bitcoin and saving for an emergency, just get a good health insurance so your life savings don't get wiped on a surgery.

Rent is not an emergency expense. It is more important than that. Rent is one of the basic necessities and should be a top priority in everyone's financial plan.

An emergency fund is not just for dealing with unexpected situations like medical expenses, illness, or accidents. It also helps us deal with other emergencies, such as job loss or unexpected financial difficulties affecting our family, not just ourselves...That is why an emergency fund is essential and everyone should have one.

We can think of endless situations that we will need money unexpectedly but some of them can be avoided with necessary precautions such as medical insurance so any hospitalization will be covered and we can even include the whole family so everyone will get the treatment if in case. Then jobloss that is hard, and it should be an anticipated situation as well with these AI and many other things that is causing jobless all around the globe.

[coin-investor]

Many people say “just hold Bitcoin for long term”, but I think one thing is often ignored: emergency money.

This is so true for many investors, because of FOMO, they invest their emergency funds or ignore setting money aside for emergencies, which is very risky, and I experienced it, I invest everything in some coins because of fear of missing out, and when I have an urgent need of money I have two options to take a loan from a loan shark or sell at a loss, I choose to sell at a loss because taking a loan from a loan shark is too risky.
This is a big lesson for me to set aside money for emergencies, because you never know when one will happen.