Bitcoin Part 2, More Thoughts

Video Transcript: Bitcoin Part 2, More Thoughts

Hi this is Phil with Foundation Wealth Planning I'm a CERTIFIED FINANCIAL PLANNER™ and today I'm going to talk about Bitcoin again. So I just did a video yesterday with a little bit of an intro to the whole situation. 

So check that out (https://www.foundationwealthplanning.com/resources/o67yg39n5j6piqyjwokjsuerrqielh )

Its not a comprehensive overview but had a few points on there that I wanted to just get out there before I do more videos on it. so again if you like the videos, please like And subscribe to the Channel I want to be able to keep doing these and hopefully get the word out would love to help just keep providing some education and certainly some thoughts from someone that's in the industry and from the traditional Finance World. you know about Bitcoin, about biblical finance, and kind of how it all plays together within this crazy world we live in so hope you like it. 

And so today we're going to talk about how this could work within a financial plan and so the first thing that we would do if we were sitting down to talk is you

0:56

 put on the table that you know Bitcoin at this point is still risky asset it's speculative and so you have to understand the risk that we're talking about it's very volatile we don't know what it could be in the future. we have some ideas of what we'd

1:09 like it to be but we don't really know.

At this point what it for sure will be so understanding that there are risks associated with this and different and potentially higher risk than some other Investments so keep that in mind.

Now the other reason or the next thing is that we would look at why you're interested in Bitcoin. So I did a video again in my previous one that talked about two of the main reasons that it could either be a potential way to make payments in the future, right?

1:40

That was initially how it was described when it was first created but yeah everyone else that's come to Bitcoin beyond the payment, thing has often realized that it can be a powerful saving and investment vehicle.

1:54

That can counteract some of the money printing from the Federal Reserve. There's also a lot of technical aspects of it there's a certain Computing things that out they're a little bit over my head. I understand it to a base level degree but you know it's pretty complicated.

so people like you from the tech cyber security type of thing with the blockchain. so people like it from the monetary side some people like it as a potential alternative to spending with

2:20

cash. there are a lot of different reasons why you may like Bitcoin and so it's important to kind of have a, I guess, a thesis this is why I'm doing this so you can, you know, be able to clearly articulate that, especially as Bitcoin goes up and down you want to be able to stick to it you know before you get into it. So I

2:40

think just having an understanding is you know Point number two.

2:45

So then, once you've got all that you say okay well when is it time to invest well I think it's similar to

2:51

other parts of you know when you would invest right it's difficult to invest if you are in a mountain of consumer debt right so, we got to focus on getting the consumer debt out of the way. Certainly the credit cards you know those High car loans and student loans there are a lot of things that are weighing people down and it's especially important when you're looking at Bitcoin because it doesn't produce any sort of income.  

It can be stagnant for a long time right? So if you have other debts the only way that you're paying those if you're putting money into Bitcoin you're only paying your debt with future cash flows from your job and so if something were to happen to your job at the same time that we're having an economic crisis and the Bitcoin price is plummeting uh well you may have to sell some of your Bitcoin to pay some of that debt off.

3:42 You want to make sure you're you're still in a strong financial foundation, have an emergency fund get those pesky consumer debts out of the way before we even look at doing so this. Because it is a higher risk so you want to make sure you've got some of your bases covered to protect your family and make sure that you've got a solid foundation to look at potentially adding Bitcoin to your portfolio. 

Now the other fourth point that 4:05 I would make on this, is don't look at this as a get rich quick scheme. Again, back to point number two and understand what your investment thesis is or why you want it and this is a good thing to discuss with an advisor that understands Bitcoin. there are certainly a lot of books and things you can read about the subject a lot of articles online but you know talking to somebody can certainly help so make sure you understand it. 

And you know just as we've talked in previous videos you know in the Book of Proverbs, it talks about if you try to get rich quickly you know I think it's the phrase is basically “Wealth gotten in  and haste will dwindle”

4:44

And so if we look at it from that perspective the Bible doesn't want us to look at get-rich-quick schemes and  don't really think that's what Bitcoin is.

4:51

Now it can shoot up at rapid rates but it can also fall at rapid rates so we want to be careful with this we don't want to have an attitude of like this is the get-rich-quick thing. I think that when we're chasing that we're not really you know in the right mindset and we certainly can be you know putting ourselves in a position of risk when we're in that capacity. 

So understand that this is a long-term thing, there's a lot of potential benefits that can come from it and you know so treat it like other investments in that capacity, but it certainly is a lot different. It can be very exciting I'll do more videos as to what I think is exciting about it but I've given a little bit of a thesis on some of that already so go back and watch the other video and rewatch this one if you have to. 

Reach out to me if you have questions if you like the video again like it follow the channel email me if you have questions or comments if you want to talk about other topics about either Bitcoin or the personal finance topics and I appreciate you stopping by and God bless.

*This is for education purposes only, not financial advice. 

Phil Francois, CFP®

Foundation Wealth Planning

phil@foundationwealth planning.com


Previous
Previous

Can You Beat The Stock Market?

Next
Next

A Financial Advisor Discusses, What is Bitcoin?