5. Emergency Fund First. Always. I know we’ve been hearing this a lot here on this forum, in fact it was when I joined this forum I started taking my emergency fund more serious.. Bcus it’s one of the most powerful steps. Maybe built at least 1–3 months of your basic expenses in cash or stable value.
When you are building up the amount that you invested in bitcoin to be at least 3 months of your expenses, then during those times, you may well be in position in which it is preferable to build up the emergency fund and the bitcoin holdings at around the same pace, yet once your bitcoin reaches more than 3 months or more that you have put in of your expenses (it might have had grown through bitcoin appreciation too), then you are likely going to be putting your bitcoin at risk if you are letting your emergency fund have less than 3 months - including 1 month of your expenses seems really risky, even though surely guys are free to judge their own situation and to figure out their risk levels. So many poor people get themselves into trouble because they fail/refuse to build anything close to a sufficient back up funds system, and then their bitcoin end up serving as their back up funds, which ends up leading to their having to sell some or all of their bitcoin at a time that was not of their own choosing, even when they could have had engaged in reasonable levels of back up funds that would have had saved them from such situation, so they end up having fun staying poor... and perhaps never being able to get back to the bitcoin position that they could have had or should have had with the establishment, keeping and maintaining of a bit more preventative precautionary measures in place, and adequate back up funds is one of them and not overdoing and/or shitcoining and/or trading (gambling) with their bitcoin is another those good practice measures that are likely even more important for poor people.
Yup, when one is building up their Bitcoin portfolio to be at least 3 months of expenses, it makes more sense to also build up their emergency funds and their Bitcoin portfolio at around the same pace. When the Bitcoin stash happens to exceed 3 months of expenses, (probably due to appreciation too), the Bitcoin is automatically at risk if the emergency fund is less than e months of expenses. I don't know but IMO, having less than 1 month of expenses in emergency funds kinda sounds pretty much of a big risk. This is why it's important for guys to always assess and evaluate their own personal/unique situation and figure out their risk levels.
It's important for guys to build up a solid and sufficient backup fund, and the reason why poor people often get into lots of trouble with their investment is because they mostly fail to acknowledge this fact, and then they end up dipping into their investment whenever a real financial emergency arises. And this mostly leads to them selling off their Bitcoins at times that wasn't initially of their choosing, and this can potentially keep them stuck in poverty, defeating their original plans of attaining financial freedom through Bitcoin. Having sufficient backup funds and also avoiding getting involved with certain risky practices, like overdoing it, indulging in shitcoin investment, or trading/gambling with Bitcoin is a great way to approach Bitcoin investment, especially for those who are poor investors. In order to avoid getting into financial troubles with their investments, it's very crucial to observe these precautionary measures.
Poor people might have ONLY a very narrow path of opportunities to get out of poverty, and if they spend several years building up something like a bitcoin portfolio, and then they end up screwing up their investment because of their own slopiness they might not be able to recover again... so there could be some poor persons who had spent one or two cycles building up his bitcoin holdings and he does not have much if any of an emergency fund, but then an emergency comes and his whole bitcoin is wiped out because his bitcoin was serving as his emergency fund. .and maybe if the BTC price is down at the same time as the emergency, he might never be able to recover from what he ended up losing. Sometimes also just a bit of cash can get someone over the rough periods and to prevent a bad situation from becoming even worse because the onhand cash was able to cover the expenses until the person got back on course and started earning an income and/or maybe resolved some expenses.
Bitcoin is a savings that is kept for the future. If a person creates Bitcoin as an emergency fund, then he is making a big mistake. Because investments are made for a long term period such as 5 to 10 years. And we create an emergency fund to protect our portfolio. But there are some people who use Bitcoin as an emergency fund. If you are a person who does this, then he can find himself in many bad situations. For example
*If the price of Bitcoin decreases and then that person needs money, then he will have to sell it at a loss
*If he sells at a loss, then he will be behind in terms of money and then that person will have to take a loan.
*He will break down mentally a lot.
*He may blame Bitcoin, such as Bitcoin is fake etc.
Bitcoin is very risky, but not for everyone. Because I think Bitcoin is very low risk for people who can have proper knowledge about Bitcoin and hold their holdings for the long term. Bitcoin is very risky for people who invest in the short term or use Bitcoin as an emergency fund.
I don’t understand how someone will
Use Bitcoin as an emergency funds, how is that possible well if that should be a possibility then it’s totally a bad idea, For someone to even be trading Bitcoin to make quick profits like they think they are doing, when in reality they’re loosing money from that means, Bitcoin investment is something that should be taken seriously and be invested for the future and long term purposes to hodl, Bitcoin is never a Ponzi scheme and shouldn’t be treated like one, if a fellow choose this part of treating Bitcoin as a emergency fund something you can use when you find yourself in an unpredictable situation and you trade your Bitcoin well I must say you’re not an investor, but a gambler who is looking for a quick profit.
Bitcoin is best invested for a long term purposes to hodl.