(~5 minute read)

I remember the first time “Nancy” (not her real name) asked,

“Can you pay me each day this week?”

You see, normally, we paid Nancy at the end of the week but not at the end of each day. So the ask caught me off guard.

And while it wasn’t a big deal to pay daily, it made me think about what she must have been going through financially…something that roughly HALF of all New York City households face (source).

Finally, it made me reflect how much better life is on the OTHER side of stressing out about how to make ends meet when living day-to-day or paycheck-to-paycheck.

That’s what I want to talk about today.

Setting the stage

When Jackson was born in late 2020, I took an extended paternity leave to enjoy the experience of being a new Dad. After roughly 1.5 years of play time together, sorting out nap schedules, and making sure he was hitting early developmental milestones, I decided to go back to work and landed an exciting opportunity at Coinbase.

As part of the transition, before starting at Coinbase, we found Nancy, a nanny who could help care for Jackson. Overall, she was a good fit for our family. And Jackson liked being with her during the day. And she helped around the house too – which was appreciated.

That was her end of the deal to uphold.

And my end of the deal was to make sure Nancy got paid each week, and ON TIME. That’s because I knew she was the primary breadwinner for her family. And they counted on her to make ends meet.

So of course, when she asked to be paid daily, I made sure she got paid before she walked out the door each evening.

Living day-to-day

Without passing judgement or criticizing anyone else’s financial situation, my observation is that “Nancy” was mostly living a “week-to-week” life, but sometimes regressed into “day-to-day” mode.

Put another way, most of the time, as long as she got paid weekly, she was able to keep up on a metaphorical treadmill.

However, when Nancy needed to be paid daily, that meant money was tight and she was facing some kind of financial stress (ie. maybe it was an overdue loan, or her cell phone company threatening to cut off service, or maybe even a nasty overdraft fee from her bank).

I don’t know the details, but whatever she was dealing with, I have empathy. That’s because growing up, I saw my parents in a similar financial position too.

And it wasn’t fun.

Now, as a parent myself, I take responsibility to protect my family from this kind of financial stress.

Why am I telling you this?

Contrasting against Nancy, I now live life from the other side.

After years of saving and investing, my family is now in a position where we do not have to worry about day-to-day, month-to-month, or even many year-to-year related expenses anymore.

For instance, I don’t have to worry about how we’ll buy groceries this week. Or how to pay the mortgage this month. Or even how to cover the cost of a vacation (like a recent last minute family reunion trip in Spain!).

Now, to be clear, it doesn’t mean we don’t have ANY money related stresses. Of course we do, and we still budget and plan for bigger ticket items.

But I won’t lie – as a parent, it feels good not having to stress about money every day.

Now, before this comes off as bragging / boasting, I want to assure you it is not the case. What I’m trying to do is to paint a picture, that as a parent, life is more fun when you don’t have to struggle with “day-to-day” expenses (like Nancy did) or even “month-to-month” ones (like 62% of Americans are, according to CNBC).

Also, I want to show you a straight forward strategy I use (and continue to use) help my family move ahead financially.

I promise…it’s not complicated. But sneak peek: it does involve bitcoin.

Ready? Let’s go.

The money ladder

Jeff Bezos, the founder of Amazon, is worth more than $100 billion (source). Without getting into whether it is fair that he has so much money…let’s just focus on that (big) number for now.

Assuming he has $100 billion, do you think he worries about how he is going to:

• pay for lunch or dinner?
• fix his car if it breaks down?
• pay next month’s rent?

The answer is, “No, no…and no”.

Now, contrast this with Nancy, who sometimes needed to be paid daily in order to make ends meet for literally, THAT DAY.

These are the opposite ends of the spectrum. And zooming out, most of us are somewhere in between. To help visualize:

I hope the concept is clear. But, let me go ahead and call out the key takeaway so you can see how you can try it out.

The objective: level up

The big idea is that, as a parent, you need to level up from living a “day-to-day” life to a “week-to week” life, and beyond.

For instance, if my family was operating “day-to-day” right now, my first and only goal is to figure out how to move up into at least a “week-to-week” level if not “month-to-month” in order to get some breathing room. Once there, then the next goal is aim to operate from a “year-to-year” or even “decade-to-decade” position.

Why? I mentioned this above, but the more my family levels up, the less we have to worry about the small(er) ticket items anymore. And over time, as we continue to level up, we also get to worry less about big(ger) ticket items too.

Not in the cards?

I’m sure you are thinking, “that’s great for Jeff Bezos, but I’m not the founder of a billion dollar start up…so how am I going to move ahead on the money ladder?”

Don’t worry. Either am I. But yet, my family has been able to do it. And everyday, I see other families taking advantage too.

How? This is where bitcoin comes in.

How bitcoin can help

When I first tell fellow parents about bitcoin, the most common reaction I get is, “you are insane…I don’t want to take crazy risks with my family’s financial future on something so volatile.”

And I don’t blame them. On the surface, most parents see the price of bitcoin with a day to day lens. And what they see is a wild roller coaster that goes up 5% in one day, down 10% the next day, and then back up again.

And the volatility is where most parents get stuck. But this is a big mistake…

Actually, I recommend doing the exact opposite thing. Instead of trying to time the market or day trading with foolish hopes of playing the volatility, all I do is just buy some. And hold it. And keep holding it with a multi-year time horizon.

Why? If you zoom out and look at bitcoin on a longer time horizon (ie. multi-year), instead of seeing crazy volatility, the picture is very clear.

Bitcoin is BY FAR the best performing asset of the last 10 years. And I say that as someone who also owns stocks and real estate too.

The strategy

Buy bitcoin. Hold bitcoin. That’s it.

I am grateful that when the price of bitcoin was just $500 (back in 2013), I just bought it instead of trying to time the market and wait for it to drop to $450 to get it for $50 cheaper.

That’s because most likely, if I waited for $450, I would’ve also tried to wait for it to go to $400 too. This is human nature. But, when the price of bitcoin shot up, I would’ve still been sitting on the sidelines with 0 allocation to bitcoin waiting for it to fall back to $400 or $450…but never to see it that low again.

Instead, because I bought it and held it for the long term, today, that initial $500 investment is now worth roughly worth $27,000 (as of 5/16/2023).

I like to think of my bitcoin strategy as the equivalent to taking $500, putting it in my couch cushions, waiting 10 years, and coming back to find that it has now become $27,000.

Sure, during that time, it has also gone through multiple short term +80% drawdowns. But since I just held it (ie. didn’t day trade), I’m up significantly. All without the stress of watching it go up 5% today, down 10% the next day, etc.

Finally, having studied bitcoin intensely, I will continue to keep bitcoin in the “couch cushions” for at least another 10 years because I know we’re still very early. (Check out this article from Jesse Myers, a Stanford MBA graduate and former Bain consultant, on bitcoin’s full potential value of $10 million / coin).

Life on the other side, revisited

If you own something that goes up by +5000%, it becomes life changing money.

And when it keeps consistently increasing in value, it gives your family the ability to live life without stressing about all the smaller ticket items in life like weekly groceries, a monthly mortgage payment, or even a nice annual vacation.

Now, here is the hard part: if you want to take advantage of bitcoin’s growth potential, it does require you to buy and hold some bitcoin in your family’s financial portfolio.

“I can’t afford a whole bitcoin”

No a problem. You can buy a tiny fraction of a bitcoin!

As a matter of fact, on Coinbase, CashApp, Robinhood, or many other places you can buy bitcoin, you can start with as little as $1.

And no matter what small fraction of a bitcoin you do buy, you’ll still benefit as the price of bitcoin rises.

Conclusion

Buying even just a fraction of a bitcoin now can have a big impact on your family’s financial future.

It has the power to move your family away from living “month-to-month“, like most Americans (source), and into a better financial position where you don’t have to stress so much about money anymore.

Holding bitcoin for the long term is a big part of how my family has moved ahead financially. And how we plan to keep moving ahead.

And from where I’m sitting on the other side, a place where I don’t worry anymore about how we’ll buy groceries, pay our mortgage, or afford a vacation…life is good and getting better!