[edited out]
Emergency fund it is very important to our daily life activities and when it is also related to Bitcoin investments, emergency fund play an important role in Bitcoin investments that serva as a backup incase of unforeseen circumstances, so every investors needs to plan when and how to back up his/her investments, my attention goes to the highlight capital sentence above that investors should create his/her emergency fund alongside your investments, such a statement is not wrong but for the purpose of being capable of
identifying or sperating the one that is your investments and emergency fund, i will advise that you should give a month difference or more after you have invested for proper clearfication of the investment and emergency fund.A lot of guys get sloppy, and they don't have any emergency fund, so then their bitcoin (their investment) ends up serving as their emergency fund. So then that bad practice likely becomes a matter of being too greedy, when frequently it is better to hold back a certain amount of cash and to keep that cash on hand to cover various situation that might come up and certain situations that might last quite a long time, so many times there is a recommendation to have at least three months of emergency funds, but if a guy is in his early stages of building up his bitcoin investment, he might build his emergency fund at the same time as building his bitcoin investment, and yeah sure during that period of time that both are being built simultaneously, it is true that the guy might suffer some emergency in which his emergency fund is not enough, so there remains a balancing of determinations to build up his emergency fund and bitcoin investment simultaneously (which I think is the better way forward) or to build up his emergency fund prior to investing into bitcoin (which I believe is an inferior approach and even maybe showing that the guy does not understand the importance of getting started investing into bitcoin).
There are guys who might have less than 10% of their income that they are able to split into investing into bitcoin and also building their emergency fund, and if you think about it if they are investing only 5% into bitcoin and 5% into their emergency fund, it could well take around 5 years for them to build their emergency fund and their bitcoin to point that they have invested 3 months of their income (which is 25% of their annual income) into each... so those lower levels of investment take a long time to build up investment portfolios, and even in that particular example once the emergency fund is 3 months of expenses, then at that point then more emphasis could be given to just investing into bitcoin, even though some folks want to build reserve funds too.. so reserve funds have more flexibility to be used for other things and I imagine if a guy is taking 5 years to build up 3 months of expenses of an emergency fund, he may also be tapping into that emergency fund from time to time, which will cause him to have to replenish any amounts that he had tapped into and depleted the emergency funds.
Very interesting and I like the fact that you pointed out some bad strategy which when employed by investors will be very detrimental to their investment and will put them in a bad position where they tend to their bitcoin (their investment) for emergency funds. Especially in the part where you say most guys gets sloppy and they don’t have any emergency funds. Being sloppy here I can attest to that because I’ve been a victim of such in the past whereby there was this period I became too greedy and careless with my investments neglecting the higher percentage of my income for emergency funds and due to my greediness I invested almost all my income generated that month into my bitcoin investments because I thought I was going to hit it big but little did I know that I was getting it wrong and not sooner than later I started feeling the heat from uncertainties arising from my other financial obligations whereby I was forced to sell part of my holdings to settle my financial obligations and it really affected my investment and ever since then I learnt my lessons and I’ve always tried to be more careful and whenever I do get my income I don’t try to be greedy to invest majority of the percentage, as a matter of fact after settling my other financial obligations and paid all my bills, the remaining money which is supposed to be my discretionary income, I still have to take out a major percentage off it and save for my emergency funds and whatever is left I then used to invest just so I don’t get to sell any part of my holdings no matter what the emergency situation may be.
Perhaps some of those folks who falls to this category can be able to fix things up with this strategy and stop being greedy in their investment decisions, and gradually build up their portfolio no matter how little, what matters most is being consistent with their accumulation and HODL for the long term goal.