Each of us has to figure out how much to balance out these kinds of matters, and surely there are degrees of being reckt, too.. and it seems that if some of us are able to set up emergency funds and back up funds in order that we never have to sell any of our BTC, except completely at times of our own choosing, then we are likely to be way better off than if we fail/refuse to set up such systems.

So the more sloppy we are, the worse  that we end up having to sell bitcoin, and yeah, if we had been accumulating bitcoin for 2.5 years and we managed to accumulate 2 bitcoin or so with an average of about $30k per bitcoin, we might feel that we are on a pretty decent path forward, but if we end up having to sell more than 1/2 of that bitcoin because we failed to properly plan, and we could have had avoided selling the BTC if we had taken some better precautions, then we might be kicking ourselves because we realize whatever we ended up selling, we might not be able to get back, and sure it is not as bad if we are forced into an emergency right now, but lets say that our emergency came during the 2022 price dip and so then we end up selling most if not all of our BTC at the price bottom, and at a loss, then we are even in a worse situation, so there surely can be cases in which we have been able to sell on a price rise rather than selling on a dip, and we end up being less damaged based on circumstances.. but still perhaps we would have had been in a much better place if we had managed our cashflow in a better way, and perhaps the fact that we got lucky in our gambling might not end up working out for us in the future.. so we need to account for those kinds of risks and determine how much back up funds and emergency funds that we would prefer to maintain in order that we would not be forced into a gambling kind of a situation that might not play out in favorable terms...and could fairly easily be avoided and/or mitigated.


Reserve funds tend to be a category that is above and beyond emergency funds.. so yeah, how much is kept and what they are used for can have more flexibility with reserve funds as compared with emergency funds,  yet at the same time, each of us chooses how to classify our funds, and so if we choose to buy on dip and to deplete our reserve funds and even dip into our emergency funds, then we run the risk of putting ourself in even a worse situation, and surely there are folks who end up contributing to causing their own emergencies, and many of us have probably met those kinds of people in our lives who are continuously (once or twice a month) experiencing one emergency or another... and so some folks like to live on the edge, and it can end up costing us more if we are dealing with volatile assets like bitcoin, and it can become even worse if we might be using leverage too... which truly I don't recommend using leverage, especially for people who are early in their learning about bitcoin and it takes more experience to figure out responsible ways to use leverage, yet there are people who just love to gamble, and so many of us are going to be way better off if we can either eliminate our gambling tendencies or at least to figure out to limit our exposure in cases in which we are not able to resist our temptations to gamble, then maybe if we are just gambling with a relatively small portion of our bitcoin holdings, then we can still satisfy some of our urges to gamble without going overboard.. yet many of us likely know with gamblers they almost never know when to stop so their risk taking tends to become greater and greater with the passage of time, especially if they have not figured out ways to control their urges and to limit their exposure to risky situations by identifying the risk and figuring out their position size in a reasonable and/or prudent way.


There is something that is off about your statement, @Proty.  

Surely if a person has emergency funds, then those emergency funds would not be touched until no other funds are left, so if an actual emergency came in which either income was reduced greatly or expenses went up considerably, if you have both emergency funds and reserve funds, you would spend from your reserve funds first.

Regarding using reserve funds for buying bitcoin, sure no problem, you can reserve funds that are set aside for a variety of reasons, and you can even change your mind regarding the purpose of whatever reserve funds that you might have at any particular time.    

Sometimes people who are in their very early stages of BTC accumulation, they may well have zero or close to zero reserve funds that are designated for buying BTC because perhaps they might already be setting their DCA for as aggressively that they feel  that they are capable of being in regards to BTC accumulation, whether those buys are weekly or some other periodic basis, yet surely if there were reserve funds being held for various other reasons such as saving for a vacation or a computer or a motorcycle or a bicycle for the kid, if the BTC price dips, there could be a decision to reprioritize those funds and to decide to buy on the dip, when previously there had been thought that those funds were being saved for some other purpose, yet there are abilities for people to redesignate reserve funds for any reason or no reason or to just be spontaneous about it.

In regards to emergency funds, it seems prudent that a person should force himself to be more strict about any kind of redesignation of emergency funds to be used for any purpose other than an emergency, yet even with emergency funds, a person can decide to be short-term more risky, and sure those kinds of decisions could end up having higher costs than expected if some kind of an emergency were to come up after some of the funds were used, yet people are able to weigh these kinds of risks and sometimes might be willing to push limits beyond what others might be willing to do, yet if they believe that they have weighed their risks in relatively accurate ways, then people have discretion to do whatever they like, even seemingly dumb stuff... yet in any event, it seems that the threshold for spending emergency funds should be higher and more strict for anyone trying to exercise strong cashflow management skills that are based on reason rather than emotion and spontaneity that might not work out well for them if they are not able to put limits on themselves.