Smart Bitcoin Strategy for Beginners on a Budget

Someone asked, "What are the best ways to accumulate Bitcoin if you're still early in your career and you cannot dedicate your entire paycheck to it, etc." So, here's a bunch of thoughts. Uh, first off, let's go step by step. Starting with the basics. You need Bitcoin. In order to get Bitcoin, you are going to have to exchange something for it. Likely that means exchanging your work for US dollars that you convert to Bitcoin since most employers pay in US dollars. Okay? Okay, so you need US dollars. So option one is get a job if you don't have a job or get another job if you already have a job or work extra extra shifts or things like that or upgrade your skill set, get a raise, etc. So let's assume you've already thought about that and already done what you can. The next step is find a way to live below your means. And the best person with the best resources about this is Dave Ramsey. Now, Dave Ramsey would tell you, you know, put your money in mutual funds, which in my opinion would take forever to build wealth. Uh, and that's just because he doesn't understand Bitcoin. Like, he said on his show back in 2013, "What if some computer nerd just goes and turns off the computer that runs Bitcoin?" Like, he doesn't even understand it. And that's totally normal. People that have built their entire career on an old system are often the last to adopt the new system because the old system is what they understand. that it's just hard to teach an old dog new tricks. Even if it's somebody like Dave Ramsey, who I really like a lot. Dave Ramsey has fantastic resources and approach for cutting spending, living within your means, and having financial resources available to build wealth. Huge fan of that. So, assuming you have a job and you've creating as much income as you can and you've update upgraded your skills as much as you can to earn more, the next step is to live beneath your means. And again, I recommend Dave Ramsey and his approach, Financial Peace University or whatever he calls it these days. I would recommend you do whatever Dave Ramsey tells you to do to live with below your means and have money left over. Okay? If you have money left over, that means you can buy Bitcoin. So, let's talk about the ways to do that. The easiest way is to just buy uh Bitcoin on River, R I Ver, with it linked to a bank account. So, if you get paid every two weeks, every two weeks you can go in there and whatever amount of money you think you're not going to need, you can use it to buy River uh sorry, buy Bitcoin on River. You can also set up direct deposit. Direct deposit is not all or nothing. So, typically on apps like um you know, Robin Hood or I don't think let's see, River does not accept direct deposit yet. They're they're rolling that out in the next few months, but they don't have it yet. Uh but anyway, when they have it, apps that support direct deposit ask you what percent of your paycheck you want going in one thing versus another. So if an an app like Robin Hood, Robin Hood supports this, um if you set up direct deposit, you could say, "Hey, I want you know $100 to be deposited uh you know to Robin Hood or whoever supports direct deposit." At some point is going to accept direct deposit again. strike. St I ke strike already strike deposit. But you can choose how much of your paycheck you want deposited and subsequently turned into Bitcoin and it could be 20% 25% 5% it can be whatever. So you can do it that way but you can also just every time you have money buy Bitcoin on River. Uh another thing you can do is um you can use the new Coinbase credit card. So, Coinbase just came out with a credit card where you automatically get 2% uh back in the form of Bitcoin on every purchase. And of course, if you set that credit card to pay off from a traditional bank account or however you currently pay off, you know, credit cards, if you're using credit cards, first of all, I do not recommend credit cards. But if you are using a credit card for everything anyway and you're earning like airline miles or something like that, you can switch that over and start using the Coinbase credit card and earn Bitcoin instead. And 2% back in Bitcoin on every purchase can add up over time. So, that is one way of doing it. Um, let's see. Other ways that would result in material amounts of Bitcoin acquisition. Um, let's see. Yeah, I mean it all comes down to how much do you make and how much do you spend and therefore how much do you have left over that you can convert into Bitcoin. And then once you're going to convert it into Bitcoin, you can either do that on River uh or you can buy stuff with the Coinbase credit card and get 2% back in Bitcoin. But obviously that's going to take forever to build significant amounts of Bitcoin wealth. So, you know, any strategy almost inevitably is going to involve a combination. Um, in my case, I do all of the above. So, yeah, historically, I've spent uh with the Coinbase debit card, which only which only gives you.5% back in Bitcoin, but I switched over a week or two back to the Coinbase credit card, so I get more than 2% back. I think it's like 2.5 because my balance is just above $10,000 because I have to have enough in there to pay the credit card balance every month that comes due. And I'm paying with Bitcoin because I have enough well because I don't have US dollars to pay because I converted them all to Bitcoin. So once you're late in the process of acquisition of Bitcoin, you've already converted as much of your US dollars into Bitcoin as you canned and then you're living on Bitcoin. And once you're living on Bitcoin, if you're using the Coinbase credit card, you just switch it over to pay from your Bitcoin balance rather than to pay from a US dollar balance. And you just keep on going and it's, you know, 2%. Uh, in my case, it's 2 and a half because uh the balance is just above $10,000. That way every time the credit card bill pays automatically with autodraft from my Bitcoin balance every month, I want to make sure the balance is high enough that it doesn't uh you know start acrewing the annual percentage yield. I don't ever want to pay a penny of interest on any credit card ever. I never have. I never will. So everything I've ever time I've ever used a credit card, it's set to auto autopay. It used to be from a bank account, but for the Coinbased uh credit card, I have it set to autopay from my Bitcoin balance. So, that is for me two and a half% back on every purchase on uh using the Coinbase credit card. And then that pays down um from uh my Bitcoin balance. And then obviously I can replenish that balance using Bitkey anytime I need to replenish that balance uh to keep it where it will not uh create a problem when the credit card bill autopays every month. So that's another way you can do it. Um yeah, I don't I don't know. There's there's not magic. I think my my approach that I feel like I can be most helpful to people on is not how do you live below your means because I feel like Dave Ramsey already does that way better than I'll ever be able to do that. I think my comparative advantage is uh how do you get Bitcoin? How do you secure Bitcoin? You know, what do you do once you have wealth? So, I feel like I can be the most help by saying, "Hey, if you have retirement funds, put them in a Fidelity crypto IRA and buy Bitcoin that way. If you have dollars in a bank account, use River to turn those into Bitcoin. If you need to buy stuff anyway on a credit card no matter what, use the Coinbase credit card and get 2% or two and a half percent back on every purchase. Um, you know, I so I feel like I can be more helpful once somebody has financial resources. And part of that is my age. At 45 years old, most of the people in my age bracket have built some amount of wealth, even if it's small. um as opposed to I'm, you know, not as helpful to somebody who is just starting out. They have zero wealth and it's all about getting wealth in the first place. I would say, well, Bitcoin is clearly your key to do that. But if you are living above your means and there's not a penny left over every two weeks, well then, you know, you're going to have to use the Dave Ramsey approach to solve that problem because I'm not going to be the best person to help you live below your means. I'm just perhaps the best person to tell you what to do with the money that you did not spend whether it's in a retirement account or a savings account or a rainy day fund or you know cash balances in bank accounts that could be in Bitcoin instead etc. Hope all that helps. My goal is always to create as much value as I can. So I wanted to take my best sha shot at this question even though again I'm I don't feel like I have a comparative advantage specifically with most of this question which more has to do with how do you build the wealth in the first place so that it can be preserved with bitcoin uh because you know you got to have bit you got to have wealth to start with to convert to bitcoin or you have to get paid in bitcoin or you have to do something that results in getting something that gets you bitcoin to start with. And again, most of my focus is what do you do after you've built some wealth over the course of years or decades? And how can you preserve and grow that wealth the most effectively, which is where I feel like I have a lot more to add. Hope all that helps. Thank you everyone.