Why HODLing Bitcoin is NOT a Financial Plan

HODLing is not a financial plan. Simply buying and holding bitcoin is not the answer to every financial question you SHOULD be asking yourself. If it somehow is your answer for everything, then you are jeopardizing your family’s financial future. I don’t care if you are young and single or older, married with kids. Doesn’t matter if you are retired or still working. No matter what your current circumstances are, every question isn’t answered with buy bitcoin and never sell.

As a Test, Can You Answer These?

How much do you need to quit working forever, drop to part-time, or work on a passion project that may never be lucrative?

How much life insurance do you need just in case you don’t have time to stack enough cheap sats to retire your family? If you passed tomorrow, would your family be covered?

Should you utilize qualified accounts like Roth IRAs, Solo401ks, or HSAs? What about a cash balance plan for your business?

Should you fund a 529 for your children’s education?

Are you on track to retire when you want?

Do you have enough to accomplish multiple goals occurring at different points in life like paying for your child’s school, buying that lake house to make summer memories, or giving your daughter her dream wedding?

Should you own any other assets besides bitcoin? What are the pros and cons? If you should, what other assets will you invest in and what will your allocation be?

What would you do if Bitcoin didn’t skyrocket to the prices thrown around on social media as soon as you would like or may need it to?

How should you secure your bitcoin? Self custody? Collaborative Custody? Multi-Institutional? Single Sig? Multi Sig? What about proper backups or physical security protocols?

Should you establish a revocable living trust to avoid probate and pass assets efficiently?

Will your bitcoin and other assets become public information when you pass?

Should you establish an irrevocable trust? Which one? How much and of what assets should you fund it with? If you put Bitcoin in it, how will you custody the Bitcoin so that the courts and IRS actually acknowledge the trust's existence?

Should you maintain a fiat emergency fund?

Can your wife stop working to be a stay at home mom and raise your young kids?

How should you manage your capital gains tax bill or lower it when you do sell your bitcoin?

Will you owe 40% in estate taxes when you pass? How can you avoid them? Even if you don’t sell, the IRS still comes after their money.

Can you gift bitcoin to children, parents, or loved ones without it being taxable?

Should you allocate to bitcoin miners to create cash flow or “sats” flow? What if buying the miners and taking depreciation could offset other income or capital gains allowing you to have a profitable investment and realize tax free bitcoin gains?

Should you sell that old real estate property or properties now that you’re orange pilled? What if you could do a cost segregation and avoid 6 figures in taxes?

What should you do with the stock compensation you receive at work?

Should you add bitcoin to your business balance sheet? How much? What are the accounting implications if you did? Why would you do that vs buying bitcoin personally?

Should you try to “get on zero”? If so, how will you manage your cash flow?

Are you properly managing your UTXOs?

Will your heirs be able to access your bitcoin? Will they owe tax on it? Why can’t you just give them the keys and not tell anyone? Do they know what Bitcoin is and how to manage it?

Are you maximizing your business tax deduction strategies to save and stack more sats?

Do you have sufficient insurance coverages to prevent someone from suing you and causing catastrophic consequences for your family?

What if you lost your bitcoin in a boating accident? (;

How much can you afford to spend in retirement? What if Bitcoin drops by 50-90%, should you try not to spend any of it?

How can you tax efficiently sell other assets to allocate more to Bitcoin?

How can you get your pre-tax Bitcoin out of the 401k or IRA now that it has grown substantially?

Do you have a detailed succession plan in place to ensure your Bitcoin is passed down smoothly without any legal or tax complications?

What if the government does try to fight us or bitcoin? How can you ensure the privacy or anonymity of your stack?

How will you handle health care in retirement, especially if you don’t qualify for Medicare yet?

Do you have a tax-loss harvesting strategy to offset capital gains taxes when Bitcoin’s price dips? Are you tracking your numbers well enough to actually report the losses correctly?

If social security is still around, when should you take it?

How will you handle financial obligations if you are forced to sell Bitcoin at an unfavorable price due to market timing?

What happens if Bitcoin “fails” and the world we see doesn’t come to fruition?

What if you retired with 100% bitcoin and a 70% drop followed?

Do you have a contingency plan if you or your spouse need to stop working earlier than expected due to health issues or job loss?

Should you leverage your bitcoin instead of selling? If so, how much of your stack? How much leverage should you take? How much leverage do you need for liquidity?

Should you utilize low interest fiat debt when bitcoin is down instead of spending? If so, how much?

Should you refinance or take out a heloc on your house to buy other assets?

Do you have a succession plan in place for your business? What if you passed, do you have a buy/sell agreement with liquidity for a possible buyout of your business partners?

How much tax will you owe this year? Do you have liquidity to cover it without selling bitcoin?

Are there any tax savings strategies you don’t know about, but could use to lower your tax bill this year?

Are you aware of and keeping up with all the rules changes on the horizon?

Are you confident in your plan?

Do you have any questions or concerns you’ve pushed to the back of your mind, but they still come up every now and then?

Will you be able to provide your children with the things you never had, but want them to have or experience?

Do you spend too much time managing your wealth that could be spent with family?

Should you sell assets to pay off debt? Is the peace of mind worth it? Are the opportunity costs higher or lower than you think?

Are you interested in buying a business with your bitcoin wealth and putting that business on a bitcoin standard? How would you structure the deal?

Do you plan to sell your business? How should you structure the deal? How much will you pay in taxes? Can you save on taxes?

Do you have any financial blind spots?

All That to Say...

That’s only a fraction of the questions that could come up along your financial journey. I’m not trying to be a jerk, I genuinely want the best outcome for you and your family. We’re here to shine a light on potential blind spots and help you sleep peacefully at night, confident you’re making all the right decisions. The point is, don’t dismiss financial planning principles and strategies, because you see a future world on a bitcoin standard where financial complexity is diminished. We are not there yet and won’t likely be there for decades. I can see that future too, but at this stage of the game it’s important to give the greatest asset in history the intentional, strategic planning it deserves and your family’s financial future deserves.

If any of these questions sparked doubt or stress in your mind or if it made you think of other questions you don’t have answers to, schedule a call with us to learn more about how we can serve you. We are the financial planners for bitcoiners, because we are bitcoiners ourselves. Don’t procrastinate, schedule a call today and let’s give you the clarity you desire.
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