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Why are you calling it emergency funds when you know you still going to invest in money in other things? Either gold or other investment, don’t invest your emergency funds in them, because if their is an emergency case, you are going to regret why you decided to invest the money which is suppose to be used in taking care of any emergency when the need arises. If you decide to invest your emergency funds in bitcoin or other coins, when you need the money, then you might be selling at lose because you won’t really have choice at that moment than to sell even if you are in big loss. My emergency funds are always in my local currency, and it’s always in my bank account.
I made a comment regarding diversification few days ago which I have quoted below.
Well I am not sure for others but for me I think investors especially new investors should focus on Bitcoin investment first and keep accumulating as much as they can because managing multiple investment requires a certain level of experience and financial stability. So before diversifying you should ensure that your investment goals are clear and won't be compromised. If it will be affected then it's better to prioritize accumulating more Bitcoin until you have achieved what you are set out to do or at least reach a certain level that won't be affect your goals.
No need to rush into diversifying, there is no deadline. You can always diversify when it's safer.
Some people fail to understand that emergency funds are meant for emergency situations and if they must diversify they can't rely on their emergency funds else they will compromise all their investments. Managing two investment even with emergency funds is not so easy then think of managing them without any emergency funds.
Putting your emergency funds into Gold is not ideal and can't be regarded as emergency fund anymore rather another form of investment on it own. Doing so will definitely affect your investment when emergency situations come it make managing it very difficult and you will ending touching part of your investment which will lead to your investment plan being compromised and your investment goals not achieved.
Many of us likely know that best practices is to keep emergency funds in your local currency, yet there are folks who will keep emergency funds in dollars rather than their local currency or they might keep emergency funds in some other form that they consider to be liquid, and sure gold might be o.k. for part of the emergency funds.. if maybe you might spend from your gold before spending from your bitcoin and sure gold could be somewhat liquid depending on where it is held.. yet at the same time, there could end up being downward volatility with gold when you need the funds, yet I don't consider it completely outrageous to keep some emergency funds in gold.. and ultimately guys have to decide these kinds of things, including that there are some guys who fail to create and maintain any emergency fund, so then by default their emergency funds end up being their bitcoin, which surely could end up causing them to get partially or completely wrecked.. so they are taking decently high chances when they keep their emergency funds in any currency other than their local currency.. yet even with some local currencies, guys do not want to keep more than a week or two in their local currency if they currency does not tend to hold its value very well..
On a second thought I think you're right, keeping emergency funds in our local currencies is the best practice but keeping your emergency funds in gold is not totally wrong if the volatility is reasonable and can actually hold it's value but it's still a decision that needs to be thought out carefully considering the fact that it is also volatile. It's wrong to not have any emergency funds at all to back up your investment, if your Bitcoin is your emergency fund then your investment plan will definitely be affected along the way and you end up being stressed financially.
We often do a lot of work without preplanning, we do it without thinking about what will happen 2/3/4 weeks, months, years after doing the work? We work without thinking about what can happen which later makes us face difficult problems.
Most of the time we invest our emergency fund in the wrong place due to which we have to pay later.
We do not understand which type of collection should be invested in which sector.
I think everyone should do a lot of study on this before investing.
Emergency funds are really meant to be a safety net for unexpected expenses or financial emergencies. They're not supposed to be invested or used for generating returns. We should keep them separate from our investments that way we can ensure that we have a backup plan in place, without having to dip into our investments and disrupt our long-term plans. That way we can have peace of mind knowing that we're prepared for whatever life throws our way.
No much studying is needed for Bitcoin investment, once we understand how to manage and set up our wallet and safe guard it then we are good to invest when we have discretionary income and emergency funds all sorted.