How to avoid forced selling Bitcoin holding in financial problem

[Saltysugar99]

To me, the biggest risk for a long-term Bitcoin investor is not just a price drop. Sometimes, a bigger risk is a financial situation where you don't want to sell, but are forced to sell Bitcoin due to income loss, or some other emergency. Then, where the price of Bitcoin is no longer in your control. You might sell when the market is very low, and it can be very difficult to buy back the same amount of Bitcoin later.

If you keep these things in mind while investing, even in bad economic conditions, Bitcoin holdings will not be directly affected.

1. You should buy Bitcoin only with discretionary income.
2. You should pay more attention to creating a backup fund.
3. The DCA amount should be kept flexible. This means that the DCA amount can be changed as income increases or
4. You should try to make cash flow strong over time so that the possibility of a worsening financial situation decreases.
5. You should never use emergency fund for dip buying.
6. You should have the intention to hold for 4 to 10 years or more.

Let us tell you about your situation and give you an idea for those who have already started investing. If Bitcoin will down 50% tomorrow and at the same time your income stopped for a few months, do you have enough cash to run a basic life without selling Bitcoin?

[coinlary]

To me, the biggest risk for a long-term Bitcoin investor is not just a price drop. Sometimes, a bigger risk is a financial situation where you don't want to sell, but are forced to sell Bitcoin due to income loss, or some other emergency. Then, where the price of Bitcoin is no longer in your control. You might sell when the market is very low, and it can be very difficult to buy back the same amount of Bitcoin later.

You mean losing your source of income instead of " due to income loss". Also , no one has  full  control over the price of Bitcoin. Meaning,  everything needs to be put in place if you trully want to sustain your bitcoin holding to sustain your long term goals.

Losing your source of income will eventually put your buy to a stop as well and eventually if you don't get secure another source of income soon, you will run out of your backups (be it emergency or savings ) and you will end up selling your sats as well . Your source(s) of income is very important indeed .

Here's what I can suggest  to anyone:
Sum up all your incomes and make a plan in percentage how much percentage  required for paying  , bills (includin feeding ) ,  investments(including bitcoin) , emergency , needs and wants , and so on.
These way you will make a better decision (provided you follow your plan appropriately)

[Sim_card]

Nobody prays to lose their source of income because it must affect your way of living. Since, you have emergency funds on ground, you can use it to survive for the main time before you get another means of income. However, having multiple sources of income is good like setting up a business couple with your job to make life easier because you cannot lose both sources of income at the same time.

[Rockson1]

I don't think price drop is actually a problem for long-term investors since it creates a buying opportuniy, op is there much to discuss here, you have already provided solutions to the subject of discussion, what I have to say is that, every investor especially long-term investor should have it in the back of their mind that Emergency is certain, and it must come, if it does not occur immediately, it will come along the line or when you are about to hit your target, so preparations should be made to cover for it which is by creating emergency funds, it is important for investors to have their emergency funds in other not to make their Bitcoin hodlings an option to cover up emergencies when it occurs.

When an investor loses his source of income, it might cause him to take a break, if there's no other source available, and that is why it is good to have different sources if possible, so that if one fails, you can fall back to another.

[Kelward]

Bro, your Bitcoin na your personal property and if you get a very good reason to sell am prematurely before di long term wey you carry for mind to solve immediate financial problems wey you no know where you go raise di money dat na wise decision to take. Where e no go make sense be say if wetin you spend your Bitcoin investment on na something wey no worth your selling your Bitcoin for like to raise money to buy "ashoebi" for occasion or to buy di latest iphone, dat one mean say na misplaced priority you get.

Bitcoin investment matter no be life and death, if you no get discretionary funds to buy make you no kill yourself or de overthink am, wetin you go do na to either cut cost make you for fit to afford discretionary funds. If e no possible to cut your basic expenses cost make you try to hustle more to increase your income so dat you go fit to afford discretionary funds to de buy. Also we supposed to de flexible with our discretionary funds, you go priotize your wants according to how dem take de important to you, anywhere wey Bitcoin fall into your hierarchy of wants na for dat range you go de accumulate Bitcoin. Lastly overtaking is allowed in your discretetionary funds, you go de use your discretion to know weda you supposed to add money for your Bitcoin accumulation or not from di fund.

[Doan9269]

If you are a bitcoin investor and you don't want to get caught in an unexpected situation with your investment, then try to have an alternative plan for the additional coins you are going to hold in a separate wallet for emergencies. We don't pray for such things to happen, but there are times when things could come up unexpectedly. You will need to exchange your coins to meet some basic needs as a matter of urgency, and that is where you consider your additional fund meant for any form of emergency in cryptocurrency.

[Hyphen(-)]

Nobody prays to lose their source of income because it must affect your way of living. Since, you have emergency funds on ground, you can use it to survive for the main time before you get another means of income. However, having multiple sources of income is good like setting up a business couple with your job to make life easier because you cannot lose both sources of income at the same time.

That is the advantage of having emergency funds in case of any emergency, and losing your job is also an emergency, that is why the OP is explained that the amount to used on DCA should increase or decrease with the nature of your income so that you will not stress yourself to maintain the same amount you used to buy Bitcoin even when your sources of income has reduced, no body will want to sell his/her holdings anytime, that is why we have emergency funds, but if you have no option, taken part of our holding is also good because we invest to be saved in the future, and this can be the future.

Moreover, if you lose your job, you can use your Bitcoin reserve to create something for yourself that will help you generate more money, so that you can continue to buy Bitcoin and keep holding.

[EL MOHA]

Nobody prays to lose their source of income because it must affect your way of living. Since, you have emergency funds on ground, you can use it to survive for the main time before you get another means of income. However, having multiple sources of income is good like setting up a business couple with your job to make life easier because you cannot lose both sources of income at the same time.

Sometimes it’s actually easy to say one should seek multiple income but do we have that opportunity to do that, most even struggled before getting the main income and when they lose it that’s all. Personally what I usually say to people that unfortunately lose their source of income and do not have any other one and also tehor emergency funds doesn’t seems to measure up or help take them out of problems is to liquidate their bitcoin even though it’s actually small percentage because you cannot keep holding on to an asset and be living in problems.

But to avoid situations like this, people need to take action like diversifying their source of income before they get faced with any problem, one shouldn’t be comfortable with their primary source of income, even if you don’t get an extra job, take some funds out and build a business. Yes business is hard but not trying any is more difficult. I think business is the easiest secondary income you can add to a primary one

[Mhizlove]

Nobody prays to lose their source of income because it must affect your way of living. Since, you have emergency funds on ground, you can use it to survive for the main time before you get another means of income. However, having multiple sources of income is good like setting up a business couple with your job to make life easier because you cannot lose both sources of income at the same time.

Honestly, depending only on one source of income will definitely affect your livelihood. That is why it's advised to heve multiple sources of income even though the second one isn't bringing much income. When it comes to emergency funds on the other it's ought to serve as a backup plan because you won't know when you might lose your job and is not certain that you will be in the business or job forever, so having another side hustle will really help alot. Most of these investors you see don't only focus on investments, they do have something they can fall back if the market is not stable.

The most important thing here is not depending completely on one source of income, the other business (backup plan) might be little at first but with time it can turn out to be something good that will help you bounce back.

[ZeroVinsonN]

Let us tell you about your situation and give you an idea for those who have already started investing. If Bitcoin will down 50% tomorrow and at the same time your income stopped for a few months, do you have enough cash to run a basic life without selling Bitcoin?

Who's us?
You know, we can try to maintain a strong cash flow but this is Nigeria and it's definitely not easy for one person to try on multiple jobs or even create multiple businesses for themselves, a vast majority of people can only manage their one job or business and don't have any second option to run to. It's good to advise people to take these measures but how they are going to do it is a different matter all together.
I don't disagree with your list though, we should never be willing to invest with our emergency fund and just like how our discretionary income will most likely be flexible out investment with the DCA/NCA should be too.

[Princess Leah]

Nobody prays to lose their source of income because it must affect your way of living. Since, you have emergency funds on ground, you can use it to survive for the main time before you get another means of income. However, having multiple sources of income is good like setting up a business couple with your job to make life easier because you cannot lose both sources of income at the same time.

Yes, situations like that do occur but when someone created a backup fund like the OP advised, they won't really have too much problem in surving or withdrawing from the investment when it's not due, to survive. The future is unpredictable unfortunate situations can occur but if an investor prepares ahead for it, then the investment won't be affected.

 Therefore investors need to take their emergency/back up funds very seriously so in times of unfortunate situation that would require them to be of them, the investor won't be stranded and fall back to withdrawing from their investment at lost, to settle the problem.

[Makus]

For a lot of people that have challenges along the line in bitcoin investment this is the obstacle that they face, Even after using DCA and investing within their capacity they end up selling their coins at some point and just like what you made mention of in the 5th point, having an emergency fund is important but the most vital thing for anyone investing in bitcoin to have is a constant source of income. investing in bitcoin when you have nothing that brings in an amount of money either weekly or monthly would definitely get you in this situation where you start contemplating on selling your coins, this is why an investor must not only build an emergency fund but also a source of income as well, this is the backup or support that you need, without this you shouldn't be investing in bitcoin.

[fredericktaylor]

It is very important for investor to have an emergency fund to manage investments consistently and for a long time in emergency situations. None of us know where danger awaits us and accidents can happen at any time, so it is very important to have an emergency fund so that in times of danger we do not have to completely close our investments or sell all our investments.

As time goes by, the needs of every person increase, which in turn increases the amount of expenditure. Inflation also increases the expenditure, so it is not possible to manage everything properly with a small income, so it is very important for the investor to diversify his income. When an investor has a diversified income and has an emergency fund to protect him from unknown dangers, an investor will be able to manage investments consistently in bad times and hold Bitcoin for a long time.

[Ashawowo(OS)]

Let us tell you about your situation and give you an idea for those who have already started investing. If Bitcoin will down 50% tomorrow and at the same time your income stopped for a few months, do you have enough cash to run a basic life without selling Bitcoin?

It is easier to hold your bitcoin when you take your savings seriously, although for me, I give my savings equal priority with my portfolio so that I don't pile up cash which still depreciates. It is good you have good savings backup and a side hustle besides your main job, some of us into bitcoin has signature campaigns as another side hustle, Side hustles is very important, it is part of your backup, your savings would finish in a twinkle of an eye and you turn to your portfolio for survival if you don't have anything that still brings in money, no matter how small.

If you have established a business that brings you passive income, you're still better off.

[Derekfunds]

Who's us?
You know, we can try to maintain a strong cash flow but this is Nigeria and it's definitely not easy for one person to try on multiple jobs or even create multiple businesses for themselves, a vast majority of people can only manage their one job or business and don't have any second option to run to. It's good to advise people to take these measures but how they are going to do it is a different matter all together.
I don't disagree with your list though, we should never be willing to invest with our emergency fund and just like how our discretionary income will most likely be flexible out investment with the DCA/NCA should be too.

I disagree with you dude, how do you mean when you said it is not easy for one person to creat a multiple business? That is not true because a person can open or create as many business as possible provided they have the capacity to do that but the one I will agree is that it is not really possible or easy for a person to work multiple places unless those jobs are part time and not fulltime and this multiple jobs can be really exhausting but in the case of multiple business it is very easy as a matter of fact Dangote has multiple business/companies.

[Gost ms]

To me, the biggest risk for a long-term Bitcoin investor is not just a price drop. Sometimes, a bigger risk is a financial situation where you don't want to sell, but are forced to sell Bitcoin due to income loss, or some other emergency. Then, where the price of Bitcoin is no longer in your control. You might sell when the market is very low, and it can be very difficult to buy back the same amount of Bitcoin later.

If you keep these things in mind while investing, even in bad economic conditions, Bitcoin holdings will not be directly affected.

1. You should buy Bitcoin only with discretionary income.
2. You should pay more attention to creating a backup fund.
3. The DCA amount should be kept flexible. This means that the DCA amount can be changed as income increases or
4. You should try to make cash flow strong over time so that the possibility of a worsening financial situation decreases.
5. You should never use emergency fund for dip buying.
6. You should have the intention to hold for 4 to 10 years or more.

Let us tell you about your situation and give you an idea for those who have already started investing. If Bitcoin will down 50% tomorrow and at the same time your income stopped for a few months, do you have enough cash to run a basic life without selling Bitcoin?

It is never a good idea for an investor to focus on the price of Bitcoin. If a person's source of income stops, then of course that person will have to stop investing and face that difficult situation with his emergency fund. The more our funds are, the less likely we are to sell our holdings during this financial crisis. For this reason, it is best to divide our funds into three layers. Such as emergency fund, reserve fund and other funds. Keep the emergency fund as the first layer of your security layer and keep the other funds as the second and third layers.

It is always said that it is better for a person to keep the amount of emergency fund 3 times the amount of his source of income. I think 3 months is enough time for a person to find his source of income completely.

The best solution for us is to create a separate income. It is because it is not possible for a person to have two sources of income go away at the same time. If a person works, then he must create a business along with it, and if someone does business, then he must create another business. If someone takes this decision, then the chances of that person facing such a situation will definitely decrease by 80%.

[PremiumcryptoHub]

The main way to avoid being forced to sell Bitcoin holdings in financial distress is to create a separate cash emergency fund and control your spending. Every Nigerian investor who wants to avoid selling Bitcoin holdings in financial distress needs to adopt smart risk management and only invest with discretionary income. OP as you said if the price of Bitcoin drops by 50% tomorrow and an investor cannot make money for a few months, they can take advantage of crypto-backed loans, but I think there is a risk of liquidation if the price of Bitcoin drops.

So if an investor can create an emergency fund, control their budget and spending, and find additional sources of income, i.e. part-time or freelancing, then those investors will be able to continue investing regularly.

[Sammye3]

Nobody prays to lose their source of income because it must affect your way of living. Since, you have emergency funds on ground, you can use it to survive for the main time before you get another means of income. However, having multiple sources of income is good like setting up a business couple with your job to make life easier because you cannot lose both sources of income at the same time.

This should be the most critical condition to a holder, because it does not only affect their investment but also their livelihood. Bitcoin investment is not as easy as many people say it, you would not want to put your hard earned money into an investment to lose it completely to circumstances that you wouldn't see coming.

 As much it is the most trusted and secured digital asset, people do not talk about the risk factors enough for people to take precautions before investing. Long term investment should always be the goal for every bitcoin investment and that would only work when your finances are in order, so taking multiple jobs should solve that problem.

[Wiwo]

Buy the amount of Bitcoin you can hold without looking at it for emergency expenses, even though life itself is unpredictable, and situation can come along your way that even your Bitcoin holding can't sort out the Bills entirely.

To have a backup emergency funds is very important, and at the same time building multiple streams of income if you have the capability to run them is also a good way to have financial freedom.

DCA and emergency funds management is the highest leverage a Bitcoin investor should set as targets, meaning that, both your DCA funding and emergency funding should be flexible enough to suite your immediate timing conditions not being forced to do anything not even emergency since you have the fund set out for that.

[BItcoin Guy@]

Let us tell you about your situation and give you an idea for those who have already started investing. If Bitcoin will down 50% tomorrow and at the same time your income stopped for a few months, do you have enough cash to run a basic life without selling Bitcoin?

when someone has started investing in Bitcoin and he has lost his source of income, the only thing that can make his investing continue is when he has another means of income. Because without getting any other way to generate income, your investment will most definitely be affected. But when you have more sources of income, everything will be going smoothly. That is the reason why, anytime you’re trying to invest in anything, you should try to do some research and have a good investment plan. So that any challenges that come up, you can probably handle them easily.