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This is a commendable fund management plan. Having several funds in place with different liquidity levels is a great idea. The emergency funds should be more ready, available and accessible than every other backup funds, while the reserve funds can be a little more less liquid ( but still accessible) than the emergency funds.snipIt is also very essential to understand the liquidity of each of these backup funds, as this helps one to be able to effectively navigate certain challenges and also make good progress towards achieving your financial goals without feeling overwhelmed. Some of the backup funds could kept for very special purposes, just like major purchases or even for long term investments. When you know and realize the potential withdrawal obstacles of these funds, it helps you plan effectively and also to avoid falling under certain financial stress.
A balanced approach when it comes to funds management involves effectively allocating resources. This could be achieved by maintaining an emergency fund that’s easily accessible, having a very clear plans for your reserve fund and also allocating to longer term investments.
Each of us likely have different kinds of ways of storing our money and some of the money can be moved around for one purpose or another, and still we can make sure that we do not go below certain amounts of money that is in reserved without an actual emergency, so even if some kinds of funds are more liquid and other funds are less liquid, they might in combination serve as the various kinds of back up funds that cover both reserve funds and emergency funds, yet the emergency funds should never go below 3 months of reserves absent an actual emergency or maybe you made some kind of a mistake that is also able to be fixed within a short period of time if the emergency funds ends up being tapped into inadvertently, .. and then at the same time, hopefully learning from any mistakes that we might have made in managing the funds and/or how rapidly we might be able to replace the emergency funds if they were ONLY partially tapped into.snipIt can really be challenging for some people to avoid the temptation of dipping into their backup funds for nonessential reasons or purposes that may not really turn out to be actual emergencies, and this is often one of the biggest challenges some people face when it comes to funds management.
as i have discovered, the most common scenario that affect most bitcoin investors to dip dive into their bitcoin hodling, emergency fund, backup or reserve fund is addiction. addiction comes in many ways, which includes gambling on sport bet, drug addict, womanizing, clubbing and etc. most times we often neglect this things seeing them as a common thing, perhaps its one of the pioneer of most dip diving into our hodling. a real bitcoin investor should be dedicated and be serious
and totally avoid these things to be on a safer side to meet up his target. i am not completely saying that having fund
aside investmentwhile investing is bad, but there
should be jurisdictions to an extent to achieve success. success doesn't comes without determination. some urge will have to die to achieve our goal. there is more to investing in bitcoin than how people sees it. using discretion fund for fun is understandable, but going far as touching emergency fund or selling bitcoin for frivolities is something else.
another thing that makes people to dip into their hodling is because the lack the interest of setting aside emergency fund. a person who dont takes accumulating emergency fund seriously will have no choice than to touch his investment due to some mere incident