YT YouTube2Text

YouTube2Text → Transcripts → You Need 1 Year of Expenses Saved in Bitcoin

You Need 1 Year of Expenses Saved in Bitcoin — Transcript

by Rajat Soni, CFA · 2,689 words · 385 segments · language en · Watch on YouTube

Open in transcriber Summarize with AI Download SRT/VTT

Full transcript

0:00Do whatever you can to get to one year
0:02of expenses saved in Bitcoin. And in
0:05this video, I want to explain to you why
0:07I think this is so important. Let's get
0:09started. I made this spreadsheet to show
0:11you what it would look like if you were
0:12to borrow against Bitcoin after you
0:15retire if it has a consistent growth
0:17rate. So, in this case, what we would
0:19assume is that Bitcoin is going to grow
0:22at an average of 30% per year. So, the
0:25compound annual growth rate is 30% per
0:28year. Of course, there's going to be ups
0:29and downs, but what we're assuming here
0:31is that after all of those ups and
0:33downs, after all of the volatility that
0:35Bitcoin has, it grows on average 30% per
0:40year. At some point, I'm going to add
0:42the power law to this, so you'll just be
0:44able to select what the number is.
0:46I don't know if the power law is going
0:47to work. I don't know if it's going to
0:50be sustained, but a lot of people have
0:51requested it, so I just thought it would
0:53be useful to add it on here. So, what
0:55you can see here is that if your average
0:57expenses are $83,000, about one Bitcoin
1:00per year, your budget is about $7,000
1:04per month. You spend that on your needs
1:05and your wants. You would be able to
1:07retire in about 14 years if Bitcoin
1:09gives you a 30% growth rate. Keep in
1:11mind that this accounts for 4%
1:13inflation. Inflation may be higher than
1:15that. Your interest rate at that point
1:17will very likely, if you were to borrow
1:19against your Bitcoin to sustain your
1:20lifestyle, it'll very likely be much,
1:22much lower than whatever the interest
1:24rates are today. I think 7% is kind of
1:26conservative because Coinbase is already
1:28offering you an interest rate of 5% per
1:31year. So, what would happen over the
1:33next 14 years is that Bitcoin would grow
1:36at 30% per year. It would go from 83,000
1:39to 108,000 to 238,000 and so on. It'll
1:42keep growing. 2036, it'll be $1.1
1:45million in 2046, it'll be $15.8 million,
1:50but
1:50all you need is 14 years to retire. You
1:53can see that number here.
1:55After 14 years, so that'll be 2040.
1:59It'll be $3.2 million. So, your stack
2:01would be worth $3.2 million. And that
2:04would actually give you just over 20
2:06times your annual expenses in Bitcoin.
2:09Like I said before, this accounts for
2:11inflation. So, if your expenses today
2:12are 83,000, they grow to 86,000, 89,000,
2:16and so on. They keep going up. They keep
2:18rising. In 2040,
2:21they would be $143,000
2:23per year. But, the interesting thing
2:25here, something I'd like to point out is
2:27that if you account for your expenses in
2:29terms of Bitcoin, obviously Bitcoin is
2:31going up. It's going up much faster than
2:34the inflation rate. So, over time, your
2:36expenses are falling
2:38if you save in Bitcoin. So, you can see
2:39here, at the beginning, your expenses
2:41were about one Bitcoin per year. They
2:44dropped to 0.8 Bitcoin, 0.5 Bitcoin, 0.2
2:47Bitcoin, and so on. By 2040, when you
2:49retire, your expenses are only 0.04
2:53Bitcoin per year. Now, keep in mind that
2:56if you want, you can decrease the
2:58multiple of your expenses that you want
3:00at retirement. So, let's say instead of
3:0120 times your expenses, you want 15
3:03times. You would be able to retire in 13
3:05years. What I would personally say is
3:07just wait the extra year, get to 20
3:10times your expenses, and then retire.
3:11And the reason for this is that if
3:13Bitcoin draws down more than we expect,
3:15you could be in a very difficult
3:17situation if you have a smaller multiple
3:19of your expenses saved. So, now, let's
3:22talk about why you would want one year
3:25of expenses saved. That number seems
3:26pretty specific, and I want to explain
3:28why that is. It's because when you save
3:31in Bitcoin, you're creating your own
3:32personal flywheel effect. Before I go
3:35into what the flywheel effect is and how
3:37it can completely change your life,
3:39let's go into what the flywheel is. A
3:40flywheel is a heavy mechanical device
3:43that stores rotational kinetic energy
3:45using the conservation of angular
3:47momentum. I can't explain to you what
3:49all of this means. I don't completely
3:51understand it myself. But, think of it
3:53this way. When you start pedaling your
3:55bike on a high gear, it's very difficult
3:57to get it to start moving in the
3:59beginning because you're having to put
4:00so much pressure and energy into making
4:03your bike move. That's essentially like
4:05a flywheel. That flywheel takes into
4:08effect after a certain point where
4:10you've already put enough energy into
4:12your pedals and your bike starts moving.
4:14At some point, after your bike gains
4:17some momentum, it becomes easier and
4:18easier for you to maintain that speed
4:21because you have to pedal less and less
4:23and it takes less effort on your part to
4:26continue moving that bike. You can also
4:28think of this almost like with a car
4:30where
4:31the most energy is consumed when it goes
4:34from a stop, a rest, to starting to
4:37move. That first little bit of movement
4:39is going to require a lot more energy
4:41because you're going from zero to one.
4:43You're going from a standstill to moving
4:45and your engine has to do the work to
4:47get that done. Once your car starts
4:49moving, it becomes easier and easier for
4:51you to gain momentum and keep moving
4:53forward. The exact same thing applies to
4:56Bitcoin. You can see here the flywheel
4:57effect is a business concept popularized
5:00by Jim Collins in his book Good to
5:02Great. It states that major
5:03transformations and unstoppable momentum
5:06do not happen from a single event, but
5:07from small consistent pushes on a giant
5:10heavy disc that compounds over time
5:12until the wheel turns rapidly on its
5:15own. Every time you stack a little bit
5:17of Bitcoin, you're putting a small
5:20consistent push on a giant heavy disc.
5:23That heavy disc is your stack. But,
5:25Bitcoin works slightly different from
5:26how a car or a bike works. With a car or
5:29bike, you have to continue to push the
5:31gas pedal or you have to continue to
5:33pedal at some point and you have to
5:35continue to add more energy to your bike
5:38or to your car in order to keep it
5:40moving. Whereas, with Bitcoin, because
5:43of how it works, because of how markets
5:45work,
5:46you're only having to put in that effort
5:48once. So, that's why I say get to that
5:50one year of expenses. Once you get to
5:52that year of expenses, your Bitcoin does
5:54all the heavy lifting for you. So, you
5:56can stop pushing. So, you can stop
5:58putting those small, consistent pushes
6:02on your giant, heavy disc, which is your
6:04Bitcoin stack.
6:05At some point, the growth from your
6:08Bitcoin is going to be so massive
6:11that your small, consistent pushes
6:14won't matter anymore. The hardest part
6:16of this is not wanting to buy Bitcoin,
6:18thinking it's a scam, thinking that's a
6:20Ponzi scheme, and all that.
6:22Not being financially literate, not
6:23understanding how your finances work.
6:25That's the hardest part. That's the most
6:26difficult part to be in because it's
6:29very difficult to change your mindset
6:31to become somebody who even thinks that
6:33Bitcoin is part of a diversified
6:34portfolio
6:36to
6:37realizing that you can
6:39retire yourself. You don't need to rely
6:41on your government. You don't need to
6:43rely on the people around you. You don't
6:44need to rely on handouts in order to
6:46retire. It takes time and energy and
6:49effort to go from zero to one. Owning
6:52zero Bitcoin requires no energy, no
6:54effort, no understanding of how money
6:56works, whereas getting to a small amount
6:59of Bitcoin does require some effort on
7:01your part or even you are maybe taking a
7:03risk in something that you don't truly
7:06understand or trust. But that's the
7:08thing. Once you start stacking Bitcoin,
7:10eventually the Bitcoin does the work for
7:12you. So, if you can get off of zero,
7:14eventually, no matter how much Bitcoin
7:16you have, the amount that you have will
7:19help you to cover your expenses. This
7:21applies to anyone, anywhere in the
7:23world. Let's say you're living in
7:24another country where there's a low cost
7:26of living, and you're expending $8,300
7:29per year. Instead of having one Bitcoin,
7:31you have 0.1 Bitcoin. In that case,
7:34you'd be able to retire in 14 years
7:36because of your Bitcoin stack, because
7:38your Bitcoin stack continues to grow at
7:4030% per year, no matter what you do, no
7:43matter how much money you earn. So, once
7:44you get to this number, you can actually
7:46just stop buying Bitcoin if you really
7:48want to, if you're okay with the
7:50projected years to retirement for
7:53yourself. But now I want you to think of
7:54this from a different perspective. Let's
7:56say you have $83,000 per year in
7:57expenses and you save 0.1 Bitcoin
7:59instead of the initial one Bitcoin that
8:01I had mentioned. 0.1 Bitcoin will retire
8:04you in 24 years with 20 times your
8:07expenses if Bitcoin grows at 30%
8:10per year. The math of this is really
8:12simple. The reason why you can retire in
8:14only four more years if you have a tenth
8:17of the stack is because in the last four
8:20years your stack is growing so much
8:23faster than your expenses are. You can
8:25see here in the last year, 2049 to 2050,
8:28your stack is growing by almost 1.1
8:31million dollars because you have that
8:33asset base, that flywheel effect, that's
8:36working on your behalf, no matter what
8:38you do. So, your stack grew by over 1
8:40million dollars in a year from 2049 to
8:422050 and that's at a 30% growth rate,
8:44but your expenses only went from 204,000
8:48per year to 213,000
8:50per year. In one year, your stack grew
8:53by 4.25
8:55years of expenses. Just think about
8:58that. You put in the work once and now
9:00your stack is doing all of the work for
9:04you. You put in the time and effort
9:06once, you went to work, you exchanged
9:07your time, energy, and effort for US
9:10dollars, Canadian dollars, whatever it
9:11is, and you went and bought 0.1 Bitcoin.
9:14After that point, you didn't buy any
9:17more, you didn't buy a single dollars
9:18worth of Bitcoin. Your Bitcoin grew on
9:21its own. This is your flywheel effect,
9:23accumulating any amount of Bitcoin. If
9:25you can get to a certain amount, let's
9:27say you can get to one Bitcoin, do it.
9:28You can get to 10 Bitcoin, do it. 0.1
9:31Bitcoin, whatever that amount is,
9:32whatever you can afford, get to that
9:33amount and never disrupt the compounding
9:36of that stack. You can continue to add
9:38to it, but never take away from it. As
9:41soon as you sell your 0.1 Bitcoin
9:43because you get into some tough
9:44situation, because you found some
9:47opportunity, as soon as you get that 0.1
9:49Bitcoin out of your stack,
9:52it's no longer compounding on your
9:53behalf. It's no longer working for you.
9:55Getting to your initial stack is the
9:57hardest part. You can obviously just
9:58continue to stack, but at some point, if
10:01you continue to buy, let's say, $500
10:03worth of Bitcoin per month and you have,
10:05let's say, 10 Bitcoin, your stack isn't
10:07going to grow much. Let's say you start
10:09off with 10 Bitcoin, you buy $500 worth
10:12of Bitcoin per month, your stack isn't
10:13going to grow much at that point because
10:15the contributions that you're making are
10:17so small compared to the fiat value of
10:19your stack. The most important takeaway
10:20here is that you have to start off with
10:22some effort, you have to put in some
10:24amount of money, get to 1 year of
10:26expenses, get to, let's say, 0.5 years
10:28of expenses, 2 years, 5 years of
10:29expenses. The more you have, the earlier
10:31you'll be able to retire, but get off
10:33zero. That's the most important thing.
10:34Don't have zero Bitcoin because if
10:36Bitcoin does turn out to be the best
10:38asset in the world and you have no
10:39exposure, you didn't benefit from it. In
10:41fact, you lost out because the value of
10:44every other asset is going down in terms
10:46of Bitcoin. So, let's say instead of
10:48having 0.1 Bitcoin, you started with a
10:50zero Bitcoin, you can see here, you
10:51don't get to benefit from Bitcoin's
10:54growth, you don't get to benefit from
10:56every time it goes up. No matter how
10:58long you wait, you don't have anything
11:00working on your behalf. So, even if your
11:02expenses go to $300,000 per year or
11:04$25,000 per month,
11:06you have to continue working because
11:08nothing else is doing the work for you.
11:10On the other hand, if you have 0.1
11:12Bitcoin, by the time your expenses rise
11:14to $300,000 per year, you have 48
11:18million dollars worth of savings in your
11:21stack. At this point, your stack is
11:22growing so fast that there's literally
11:24nothing that you can do to make it stop
11:27growing. This is the power of the
11:29flywheel effect. This is the power of
11:32putting in the effort, the time, the
11:34energy today so that at some point in
11:37the future your stack is doing all of
11:39the work for you. Compounding is doing
11:41all of the heavy lifting and you don't
11:42have to lift another finger after you
11:44get to that point. Obviously, I'm not
11:46saying stop stacking when you get to 0.1
11:48Bitcoin or 1 year of expenses. I
11:50personally plan to keep stacking no
11:52matter what. I'm going to keep buying as
11:54long as I have extra income over the
11:56expenses that I'm paying for every
11:58single month. The point isn't to stop
12:00stacking. The point is to get from 0 to
12:021. The point is to get to that initial
12:04amount of savings so at some point your
12:07stack does the work for you. The problem
12:09that most people have is they never get
12:10the flywheel effect started. They never
12:12start working towards having their
12:14Bitcoin stack or their investments, any
12:16other investment, work for them. So,
12:18they always continue to struggle with
12:20their finances. They always have to
12:21work. They never get time off. They
12:24never become truly financially free
12:26because they haven't put the effort into
12:28starting their flywheel effect. If you
12:30want help with that and you want me to
12:32help you build a 10-year financial plan
12:34so that you can get your flywheel effect
12:35started and you can have your money work
12:38for you so at some point you can retire,
12:40check the video linked in the
12:41description below. I offer a coaching
12:43program called the Bitcoin Retirement
12:44Accelerator. The video has all the
12:45details. Put in the effort to get to 1
12:48year of expenses. Do whatever you can as
12:50soon as possible. Let's say for example,
12:51if you were to invest $500 per month
12:53into Bitcoin, you can see here that in
12:57only about
12:59say
13:007 years, you'd have 1 year of expenses
13:02saved. You'd have 0.26 Bitcoin. Your
13:05fiat balance of your Bitcoin stack would
13:06be $137,000 by then. One Bitcoin would
13:09be about 500k.
13:11And you can see here your expenses would
13:13be $109,000.
13:14So, at this point you have 1 year of
13:15expenses. Column K is what shows you
13:18that. You have 1 year of expenses and
13:20even if you just stop buying at that
13:22point within the next 15 years your
13:25stack will fully cover your expenses
13:27forever. Stop delaying this. The entire
13:29world is going to figure out what
13:30Bitcoin is. If you wait until your
13:32advisor tells you to buy, you're going
13:34to be left behind. Like I said before,
13:36check the link in the description. I
13:38want you to get to Bitcoin ASAP. I want
13:40you to figure it out ASAP, and I will
13:42work with you to get you to that point.

About this transcript

This page contains the full transcript of You Need 1 Year of Expenses Saved in Bitcoin by Rajat Soni, CFA, generated from the public captions YouTube serves with the video. The transcript has 2,689 words across 385 segments, with the original timestamps preserved so you can click any line to jump to that moment in the embedded player.

What you can do with it

Use the transcript to take notes, quote the speaker, build a study guide, generate a summary with ChatGPT or Claude via the YouTube Summary tool, or export it as a timed subtitle file with YouTube to SRT. You can also re-open it in the transcriber to translate the transcript into 100+ languages.

Free YouTube transcript tool

YouTube2Text is a free YouTube transcript generator — no signup, no daily limit. Paste any YouTube link and get the full transcript instantly, with timestamps, click-to-jump, translation to 100+ languages, AI prompts for ChatGPT, Claude, and Gemini, and exports to TXT, SRT, VTT, or Markdown.