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If I’m living paycheck to paycheck with no savings, is #GetOnZero for me?

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GetOnZero

One of the biggest criticisms of #GetOnZero is the short term volatility of the price of Bitcoin. If you need every bit of your money for expenses for the month and Bitcoin takes a dip after you’ve converted, you’re looking at a deficit. This is a real threat to your budget and it is worth the discussion.

The first thing to consider is that this isn’t a flaw of #GetOnZero, but instead is an issue with your cash flows. If you’re living paycheck to paycheck with no savings, what happens if you incur an expected expense or loss of income? What if you need $500 to repair your car? What happens if you can’t work your normal hours or you get laid off from your job?

You’d be stuck in the same hole as with Bitcoin taking a dip. So what can you do?

You need to get savings. With savings, you can deal with the future uncertainty inherent to life and absorb unexpected expenses and loss of income without having to take drastic reductions in your standard of living. Without savings, you become a slave to whoever pays your wages or collects your bills. They are the ones who ultimately control your life, not you. It’s a bad spot to be.

Unfortunately, there is no magic solution to acquiring savings. Your income needs to exceed your expenses. You either need to make more money or spend less. In a lot of cases this is going to be painful and unpleasant to do, but it’s the only way.

There is also a deeper systemic problem for savers: the fiat system does not allow you to save. The inflationary monetary policies slash the purchasing power of the holders of fiat. Furthermore, since prices are going up because of the erosion of purchasing power, you’re forced to keep earning more just to tread water.

Under a fiat standard, the right thing to do, i.e. hold a reserve of the economy’s general medium of exchange (money), becomes the wrong thing to do. It’s like being on an escalator that’s going down faster than you can run up.

That means the only way to save (as opposed to playing the casino that is the stock market or blindly using other financial instruments you otherwise have no business using) is to use the thing that actually allows for saving. We finally have that tool with Bitcoin, but given that we’re so early in the monetization process, the price has the tendency to take some short term violent swings. But that doesn’t mean you shouldn’t still work to adopt Bitcoin as your money and divest fully from fiat. But this can only happen when you come to the realization of how absurd our “normal” has become.

Consider the following metaphor:

Imagine you routinely drive on the wrong side of the road. You have to constantly dodge oncoming traffic, dealing with severe emotional and mental stress and risk of catastrophic accident, and you’re oddly enough kind of used to it. But one day someone tells you that you should go to the other side of the road where you’ll flow with traffic and have a much more pleasant and smooth ride. It sounds great, so you start to angle yourself into a lane on the right side of the road, but all of a sudden you hear a loud buzzing sound and your car starts rattling! You hit the centerline rumble strip and it is awful. You swerve back into your previous lane and continue your left side driving where you don’t have to drive over any rumble strips.

The short term volatility of Bitcoin is the centerline rumble strip and it is unpleasant to cross. But that short term pain does not justify the insanity of driving on the left side in oncoming traffic! The solution is not to continue what you’ve been doing just because you’re accustomed to it. You need to accept the reality of the situation and put together an actionable plan to get out of it. The best move is to immediately get yourself out of the wrong lane. It will create the motivation you need to reduce the risk of the transition. Just like a heightened focus as you move to the right side of the road you will have a high sense of your risk. You haven’t become accustomed to the reality of your situation, but that shock that lets you know how vulnerable you are (even though statistically less vulnerable than when in fiat) will drive you to actually get safe.

This is the only way you can enjoy the fruits of your productivity and over time improve your command of resources across the economy to build the life you want.