Hey, have you heard the news? Bitcoin is going south.
As of today, Bitcoin is going back to the price we were all used to. It was too good to be true and last too long. Also, everyone knows already cryptocurrencies can drastically fluctuate in price, making it an investment option not for the faint-hearted.
It only took Elon to complain the price is too high to make it level down and put it in its right place. In the end, let’s not overhype around it!
Our different financial contexts determine our resilience in times of uncertainty.
I am profane when it comes to cryptocurrency and investment, in general. However, I was always sensible with my money. Hence, I naturally followed my husbands’ advice when he replied to my news that I started investing in stocks and crypto. He sensibly told me only to invest the money I’m willing to lose.
Now, I’ve been lucky enough to be able to have some extra money that was sitting (and most of it still does today) in a regular savings account. If I am scared of something regarding my savings, it’s inflation. Consequently, I started reflecting on investing my money so I don’t have to sit and wait for a lame 1.5% on a 4-month deposit. But since I was, and still am, financially illiterate on investment, I didn’t go big.
My first go was to invest a little amount in stocks. Like the profane that I am, I am using my Revolut account for investment because it is handy and I was lazy to search for other alternatives. I invested in regular, like Tesla (automotive), Google (Tech), Pfizer (Pharmaceutical — which does unexpectedly bad), and SM Energy (for a diverse portfolio). And I only invested, let’s say, my coffee money for half a year. Still, it was a nice feeling starting to see how the market moves and making a little profit.
Then I started, back in December, to buy crypto as well. I went for the regulars — Bitcoin & Litecoin. The amount I invested was basically what I earned here on Medium. Not a large amount of money but around $1000, which started making some profit, especially when Bitcoin reached the all-time high just last week.
As I kept my husband updated with small bits of insight into how my investment account was doing, plus since he isn’t living under a rock and hearing that the Bitcoin is increasing in price, he wanted in as well. And he also wanted to “catch-up” on the profit.
He said to me one of the other days last week that he would like to give me a lump of money to buy some bitcoin for him. LOL. I obviously refused, also knowing our history in which even if I am not at wrong, I will still be blamed for something that I haven’t done. So, the quick answer was, “You can forget it, I’m not gonna do it. Buy it yourself”.
My poor husband decided to invest more than $2000 worth of bitcoin just last night. The moment he bought it, the price of bitcoin started going down. He couldn’t believe it. But then, he decided to wait. By today he already lost around $400 when he sold everything and got over with.
He is seriously pissed — so in hindsight, I am so glad I didn’t buy it for him.
As regards me, I’m just sitting and watching the Bitcoin show. Why? Because I’m not emotionally involved in this. It’s still money that I’m going to lose if the Bitcoin will crash and burn, but at the end of the day, this represents money that I said I’m willing to lose. It's not my salary. It’s not my house. It’s not my son’s education.
I have invested disposable money, which if make a profit, I’ll be happy, while if they all disappear tomorrow, I’ll be fine. However, owning Bitcoin helps me partake in this interesting revolution in an investment where everything is digital, happens online, and at speed light. You can experience the highs and lows of the win in a split of a second.
What can we learn from my husband's short-lived experience with Bitcoin investment?
Because this is fresh from the oven, I’ll make a quick list for people like me and like my husband, who are financially illiterate and want to invest in Bitcoin.
- Don’t invest more money than you’re willing to lose.
- If you skip no. 1, then the emotional pressure will throw you off the game, the moment the price will go down.
- Keep your cool — watch and learn. Really use your investment as a learning opportunity. You can’t do that if you skip no. 1
- Credit to Tim Denning — don’t fall for hype or influencers.
- Credit to Tim Denning (who I hope will detail on today’s news) — do the research; bitcoin is an asset you hold long term unless you’re a day trader (I really loved this one)
- Buy low, even if the dip is over.
- If you yearn for cash stability, then forget about Bitcoin.
There could be more, but these are the first takeaways that come to mind if I were to give someone advice should they be in my husband’s shoes last night. Mind you, I also reminded him about point no. 1 that he made when I started. He obviously disregarded it and went in it big. He took the worst moment ever, which cost him $400. And it isn’t at all that much as compared to the level of pain on his ego.
$400 later and a hurt ego — this was my husband’s short-lived experience with Bitcoin investment. Do you have any personal experiences with Bitcoin investment that you’d like to share?
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This story does not constitute investment advice or advice on tax or legal matters. Please contact your financial advisor or any other independent professional advisor.