Oddbean

I struggle with this because I want to keep 6 months emergency savings in cash in case my wife or I lose income/job. I don’t want to keep it in bitcoin because of short term volatility. So it’s in cash. Any suggestions?

My suggestion is keep it in #Bitcoin and have a long term perspective. The short term volatility will matter less and less as time goes on, and it will matter more and more the longer you hold cash. Savings is specifically a long term security strategy, don't shoot yourself in the foot by sacrificing its long term usefulness over short term concerns. In other words, if bitcoin is volatile in a downward direction and something bad *isn't* happening, then use that opportunity to save harder and it will pay off even more when it returns to the mean.

For an answer that less general and more practical: You can use a service like River, they pay like 3% ish on cash balances, and keep 80% of your savings in Bitcoin at all times. That way you are limiting your losses, and making up for it partially with an interest payment. While also not fully exposing yourself to Bitcoin down swings, and leaving room to buy the dip if your situation feels stable.

Thanks, and I hear you. But the purpose of emergency savings is if, say my wife loses her job we’ll be fine for a while. If she loses her job during a down cycle, and our savings go from 6 months to 2 months, that would be very bad. Yes, river USD savings account, but I don’t think we can feel good without being in USD, with or without high yield. I’d love to have a different answer, but I haven’t seen one I’m willing to stomach.

Ok wasn’t sure. It seemed at odds with what you said. But regardless if you come up with a good strategy that’s aligned with your needs I’d be interested to hear the breakdown if you think it’s valuable. The optimum split versus the savings versus the monthly obligations might be an interesting topic for exploring.

Not sure if this is exactly what you were referring to with your last point in optimum split, but I’m about as close to a full blown maxi nowadays but the only thing I get hung up on is “getting paid in bitcoin” then proceeding to sell some to cover monthly obligations. I realize I could sell same day or not transition some % of every paycheck into bitcoin, but services like Fold seem to get more valuable the more you convert to bitcoin every month. Easier to stomach during a bull run like right now but in the subsequent bear it’ll stink to see my stack shrink not only in fiat terms but also in terms of sats. Any tips for how to overcome this hurdle?