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Quote from: JayJuanGee on April 03, 2024, 10:49:12 PM

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There is nothing really wrong with those kinds of conclusions - except for a realization that emergency funds tend to be denominated in the fiat in which bills are paid because assets can suffer liquidity events at the same time, then you are fucked because everything might be going down in value at the same time, and you are forced to sell some things because you did not have enough cash. Think about what happened March 2020 as an extreme example, but it is still an example of something that could happen and you would not want to be caught on the wrong side in which you had to sell either your assets and/or your bitcoin at a time that they had just taken around a 50% or more draw down in a day and with no clarity in sight when they were going to stop going down.....

so sometimes if you are going to end up wanting to be cute in regards to making sure that your various kinds of emergency funds, reserves and/or float is working for you while in storage for a long time, is that you would still have the first 3 months or so in cash or cash equivalents that are easy to draw upon, maybe in a combination of physical, in banks, in other kinds of accounts that may or may not be interest bearing.

When shit hits the fan, you have to largely be prepared already in advance to be able to weather through the situation... maybe the bad situation only lasts a month or two, or maybe it ends up lasting several months, even 6 months or more, and so there might be some point in which you are also looking at your bitcoin as one of your forms of liquidity that you need something and you are running out of resources, and surely there could be cases in which you are in that situation, and maybe there could have had been ways that you could have better protected yourself.

Maybe I can give my own example?

Through 2017 and early 2018, I had been planning for some construction that I knew was going to cost a certain amount that was probably equal to 3-5% of the value of my then BTC stash, and so I had set aside about half of the expenses that I had calculated were boint to come due in January, February, March and April 2019.

As we likely realize throughout 2018, BTC spot prices went down from around $19,666 and down to a low of around

Thanks for the clarification, emergency funds are far much better to have in cash than I assets, you know I was only thinking that it was smart to save our emergency funds in asset but considering the potential risk that it could bring to our investment.

IMO saving our emergency funds in other asset rather than cash would actually be a misuse of our emergency funds, cause our emergency fund should be readily available to use at any time we have an emergency and your experience just proves it better.

Quote from: JayJuanGee on Today at 02:23:12 AM

But I already mentioned the idea that the cash in your emergency fund.. perhaps up to 3 months expenses is likely going to suffer from not earning any interest or growing but instead ongoingly shrinking in value, which means that more and more funds will likely have to be added to the emergency funds and if you are lucky (and you don't have any emergency), then you may well end up ongoingly maintaining an emergency fund for 20-30 years or longer that continues to get larger and larger in terms of its nominal dollar value, but none of that money (up to around 3 months of your expenses) is earning any income nor interest, just continuing to debase in its value.. but it is a cost of staying safe and hoping that you actually never have to use it.. but it is also likely keeping your rich too. .because you would also never have to touch your BTC investment (or any of your other investments) at a time that is not completely of your own choosing.

Let's say that you spend 20 years investing into something like BTC at 15% per year, so after 6.67 years, you have invested a year's of your income, and so after 20 years you have invested around 3x of your yearly income, but at the same time you have continued to maintain at least 3 months of an emergency fund and sometimes you would have an extra 6-18 months of reserves and float, and so much of that cash was not really working through the last 20 years, but hopefully your bitcoin was working during that time and sufficiently made up for the fact that your various forms of cash were not working.. and you can do these kinds of calculations to figure out whether it was worth it to maintain these various systems including calculating if it would have had been better to use your BTC and/or your other investments as your emergency fund, which surely is a kind of sloppy behavior that we see people do and we see normies get reckt as fuck too and they end up having fun staying poor because they never get ahead and they are always gambling with their money.. so by the time they maybe could have had been to fuck you status, instead they are having to work until they die and they also might not even be able to increase their standard of living because they failed/refused to properly invest and/or to properly protect their investments.

Having cash around isn't such a bad idea as long as it would keep us rich and protect our bitcoin investment, we dont want a situation where by a health challenge uncalled gor happens and the only option around is to sell off some of our asset, the thigj about emergency is that we don't know where it would happen and we don't know how much expenses it would cost us to solve such a problem, so keeping huge amount of emergency funds or allowing your emergency funds to grow over time is not such a bad idea in general and it worth it even if we have to pay the price of knowing that we woudl be earning no interest from hoarding fait or keeping such huge cash around us.

But at in a case where we feel we have too much of cash around in our emergency and reserves, would it be wise to put some into bitcoin when, let's say I'm having over a year of emergency funds and I feel I have too much of cash kept lieung around could I put at least 10% of that into bitcoin or keep or working for, like diversifying intonsome other asset ?

I don't think you need to have cash to keep yourself rich. If you have a heavy enough portfolio of bitcoins you have solvency enough. Because since you have invested in Bitcoin and are with it, it is the foundation of your own and family's economy.Your cash flow will determine what you should do even though I think most of these funds don't last more than 2 or 3 months.Your health insurances are by your side, and if you want to do something big on a budget like buying a house or buying a car...I'm saying these are essential but that's not what emergency funds are for.

If you have enough cash, instead of keeping 10%, keep more like 20% to increase the digits in BTC portfolio. Keeping the emergency fund a year seems pointless. If you want to diversify, Bitcoin DCAing strategy is easy for you.

You guys fail to read through people's post, he is rather trying to explain how keeping cash and emergency funds around would help your bitcoin portfolio excel since its a guarantee that you won't be touching it or selling sooner than it reaches its maturity, you know we plan on holding bitcoin for up to 4-10 years for minimum( although this should differ based on individual preference and situation, like age and how long they want to keep on accumulating) and up to 20 years if you are even younger, so what would be the guarantee that within this period you won't sell of your holdings, you can't rely on discipline or mere passion to do that, although this are necessary the only way to actually have an insurance that you won't sell of your holdings is by having emergency funds around that would help you in cases that would have lead to you selling of your bitcoin, let's say a health challenge or an accident or my be property damage that you need some money to solve and if you don't have any emergency fund around, you woudl have no other option than to dip into your bitcoin and if you are still early you might end up selling everything off. Although it's left for everyone to figure our balance for ourselves based on our situation its good to have at least 3 months of emergency funds around as a financial cushioin to be safe.