You cannot really know how the numbers are going to play out, so you should be merely attempting to do your best with what you got and what you know, and the thing that you know most is your own current budget (especially how much money you currently have on hand), and then you should have a pretty good idea of the amount of pay that you have coming in, but it cannot necessarily be completely known until you actually get paid. And, with your expenses, you probably know most of them, but you have some that come about from time to time or they change from time to time.
I think it can be good to at least think about all three categories of the way to invest (well 4 categories, if you think about making sure that your emergency fund is decently in place or being ongoingly built), and so sometimes you might be in circumstances in which you might not be able to employ all three circumstances, such as being able to employ the lump sum because you feel that you do not have enough of a lump sum to work with, and ultimately that is going to be up to you to figure out what would be the most comfortable of the balances of the 3/4 categories.
Thank you sir. From this I believe that having all three strategies at hand would even be more favourable to me, just incase the price soares then if I had lump sum a specific amount I would be at more advantage, and if it the price has reduced I shoul also have a reserve for buying dips if necessary. From what your implying, all strategies are good when you have a proper plan behind your accumulation and dca is just safe cause I won't have to worry about the market conditions or Current price, since I'm just investing specific amounts on intervals.
And I think I would catch up pretty fast cause I do have multiple sources of income, I won't like to share my total income for a month cause its mostly irregular cause I do have some mini investments going on with a forex group, but from your first paragraph it think your also telling me to make sure I remove some money for my upkeep, I'm still with my parents for now tho, so I think that is covered, the emergency fund, should i also remove a part of my income to cover up emergency, what kind of emergency are we talking about here?. For a start I think I can use two strategies, lump sum and dca since I can manage that for now, is it also possible I lump sum on dips, since its buying with a huge percentage of your capital each month, can I use lump sum in a way that i set it to buy at any dip that occurs in the market while I use dca to be on a safe side since the market is unpredictable? .
You may well feel screwed if the BTC price goes down after you had already invested all $200 and then you don't have anything left, and then you may well feel screwed if BTC prices go up and you still are sitting on some cash. In the beginning it is almost a no win situation and you just try to balance it out as best as you can, and maybe after a few years investing you start to feel that you have everything in place. You have figured out your budget and you have some reserves for buying on dips and you have built and established an emergency fund.. and maybe you have figured out some ways in increase your cash flows and to decrease your expenses... but you still are likely going to always have some tensions in terms of trying to figure out how many BTC you need and how long it is going to take to accumulate as many BTC as you believe that you need.. especially if your goals might be to reach some variation of fuck you status...
and if you think about it, there are a lot of people who work 30-40 years or more and they do not reach fuck you status, so if you are able to actually reach it or maybe even reach it in 15-20 years, then you end up both reaching it and cutting the time in half.. and none of that is guaranteed.. You just need to do your best under your own particular circumstances.
I believe in other to avoid that tension I would set a big goal, then start with smaller targets or milestone, this emotion strategy would be good for me to avoid the tension around the time frame for accumulation and how many I would accumulation within that time frame. Cause I believe it all boils down to the amount I'm putting in or investing in bitcoin. My strategies would even work better with a higher income, which I should try to fix. I now have an idea 💡, I could start up a business in my school and deposit all my profit as a daily dca in bitcoin, then use my monthly income for lump sums, this way I'll have a chill and start saving up some emergency funds, even if I'm not clear on its purpose. Let say I set aside another 200$, and Start up a snack business at my school, with the high traffic I'll could make daily profit of about 20$-50$ on average to very good days cause I'm targeting the hostel areas, then I'll dca about 80% or 70% of my profit daily into bitcoin and at the end of the month if I was invested a total of 20$ daily I would have total of 560$ already in bitcoin, not including my monthly lump sum. The reason I would like to have this business first is because I think I would accumulate faster and reach my goals if I had a steadier source of income that I can plan with. Then reach my own fuck you status wouldn't be a problem. If I'm going with about 5 years and sure my investment amount would be increasing, I might be able to achieve at least 2 bitcoin if not more in this time frame. I'll start by setting my first milestone which should be getting a more steady source of income. Or I could even invest 15$ from my daily profit and save 5$ so at a weekly or 2 weeks interval I'll lump sum a bit, just in cases where the price might have little fluctuations which could be up or down
Im definitely cool with dca cause from your examples I think dca is the best strategy for a newbie like me then I can learn more about buying dips and all that, and judging from my capital, how much would I be keeping out for dips, I just think its not enough, so I'll dca first, then I can add other plans later. Although I had already invested 10$ into bitcoin last week, I going now i can move a bit slowly, while getting more capital to fund other strategies.
Of course, past performance does not guarantee future results, so you just do your best.. and sometimes it can be o.k. to build up a separate fund that you would be able to use for buying on dips, even if you might ONLY be setting aside a few dollars every week for such potential purposes, and frequently I think that $10 per week is very small, yet I know that some members in some parts of the world feel that they can ONLY do $10 per month, and so doing $10 per week, you are investing 4 times more than they are.. and sometimes there could be some ways to both invest into bitcoin regularly and to build up a side fund that you would use for buying on dips.. and really my example 8 is stemming from the hypothetical income and expenses that I described to exist in example 1 .
Example 1: This person has not accumulated any bitcoin, and has an income that is between $300 and $2k per month and most months his income is around $1,200, and monthly expenses of between $600 and $1,000 per month and most months $800. This person has a debt of $1,400 that he services at $50 per month with a 6% interest rate that he services at $50 month with an expected payoff in 30 months (2.5 years), and he has an emergency fund of about one month's expenses $1k.
So in my hypothetical there is already some income and expenses presumptions that even seem to give quite a bit of a cushion for possible investing into BTC, and there is debt described and a pretty much inadequate emergency fund, so sometimes there can be enough income to be able to accomplish several things at once, but at the same time, there can be struggles in which a person might not have much if any cash left over to be able to invest into bitcoin, and so there would likely need to be some setting of priorities and if they actually have emergency expenses that end up occurring in any particular month, they can end up putting themselves into a pickle if they don't have enough in their emergency funds to cover their expenses during that period, and they feel that they have to dip into their BTC at a time that is not of their own complete and voluntary choosing.
A lot of poor people (or not so rich people who have tight cashflows) will fail in their investments (including their BTC investment) because they have not structured their investment properly and they are ONLY preparing for UP and/or they are not creating, building and maintaining an adequate/sufficiently sized emergency fund.. which should be 3-6 months of their expenses in cash (or the currency in which they are paying their expenses).
And that the reason I think setting up a business that could support my investment would be good, cause if I'm investing just 10$ weekly, how long do would it take to accumulate up to 1 bitcoin for me, and the market would either favor me in this case by decrease which I can't bet on, or increasing which would most likely happen. So i think to avoid a poor accumulation result I must have a plan that should help accelerate the process by giving more capital to strategies and invest properly. Even with a monthly earning that could go up to 300$ just assuming, alone would not give me a good time frame for accumulation since I might have some short comings that would make me dip my hand back in my investment and even my expense must be managed properly to for me to hive a higher chance to save up some emergency funds. For now I think I would start with dca with my little allowance and then use my monthly income to set up a system that can generate a substantial amount for investment. Cause if poor income and management could be a deficiency in accumulation where I might have to dip my hand back in my portfolio then I guess my first real move here should be to fix that and get my finance in order. What do you think about this.
