I really find all this your advice very helpful and I have learnt alot from what you just said here, because there was a point I was buying bitcoin aggressively going beyond my financial capacity because of a DIP that occur and my friends where buying bitcoin aggressively so I decided to follow which almost made me to invest all I had in bitcoin, but thanks for your advice that everyone should stick to their fanancial capacity and not to over do.
So, as you know, I am not against the idea of investing as aggressively as you can, even though you have to also account for your own boundaries, and if you are not sure if the money is available or is going to be needed in the future for expenses, it is likely better to error on the side of keeping your money available until your expenses are confirmed rather than investing it and then realizing that you made a mistake.. and sure we all make mistakes, which is another reason to build and maintain various kinds of back up funds.
Even the best investment opportunities mean nothing without proper financial safety nets, i can confirm that cuz I did the same thing last year, I bought a significant amount when Bitcoin was around $55K but due to bad money management, I had an emergency and was forced to sell and yet, I had the chance to buy at such a low price that in 10 years, I could’ve had a huge amount of capital. You are absolutely right money management is one of the most crucial things. You have to know how to save and be prepared for anything
Hopefully, you have a plan to get back on the bitcoin bandwagon, especially since it takes a long time to build up a bitcoin investment, and if you currently have no bitcoin, then for your own good, you better figure out ways to start accumulating bitcoin, and to get the rest of your cashflow management systems in order, even if you are ONLY able to buy $10 per week.
If you don't have an emergency fund and other back up funds, I would suggest building those kinds of back up systems at the same time that you are building up your bitcoin investment, so they might grow at a similar rate. Don't be gambling with bitcoin or fucking around with overdoing matters. It is better to stay in your bitcoin investment rather than to get forced out at time that is not your own choosing due to your bad cashflow management, and it is better to stay conservative and stay in the game for 10 years or more rather than getting in and out and not planning for the long term.
Sure, it could be that you already have some backup funds, such as 2-6 weeks of your expenses in cash, and
for example, if you were to have and income around $30k per year, which is around $2,500 per month, and let's say that you have around $1,800 to $2k worth of expenses each month. So maybe your savings could already be around $2k, and if you were to have around $100 per week of discretionary income that you were willing to put into bitcoin, you could put $75 in bitcoin each week and $25 into your emergency fund.. and in 30 weeks, you would end up having had put around $2,250 into bitcoin and around $2,750 in your emergency fund.
Sure, you have discretion regarding how to grow each of your funds, and likely bitcoin prices are going to continue to change during this time, and it could take you more than a year to build up your bitcoin holdings and your emergency funds to be equal to 3 months of your expenses, and sure bitcoin prices might have changed up or down during that time too... and even if you have 3 months of expenses in emergency funds, you may well want to have other back up funds so that you don't have to touch your emergency funds absent an actual emergency, so you might still be building up back up funds and even using them from time to time.
Once you have built up your various back up funds and you have strong cashflow management systems in place, then you could focus more exclusively on investing into bitcoin, and sure if you make mistakes from time to time, you have back up funds to fall back on and if some larger emergency comes, then you have emergency funds... yet I personally believe that we should try to engage in behaviors and to make preparations so that we never have to dip into our emergency funds except rare and temporary occasions and if our cashflow dries up we have figure out ways to get additional cashflow before having to dip into our emergency funds, when possible.
And if we have modest finances, it could take us couple of cycles before we might modify our system of accumulating bitcoin in such a way that we are not necessarily accumulating bitcoin every week, persistently, consistently, regularly, ongoingly and perhaps even aggressively. There might be some point where our bitcoin stash size is starting to inform us that we might be able to let off our bitcoin accumulation or perhaps to just buy on dips or some other modifications that are based on our stash size. I tend to consider that it is likely that we need to go through BTC accumulation first, which could take a cycle or more, an then we might have a period of maintenance that might be less focused on BTC accumulation, and then finally we get to a state of being able to withdraw from our BTC... which is a product of time and a product of stash size.. and we have to figure out how much of a stash size that we need for our ability to sustainably withdraw from it and even perhaps completely live off our bitcoin stash or to have our BTC stash supplement other forms of income that we have.