Bull Run Trap: Balancing Life Improvement and Investment Continuation

When accumulating substantial unrealized gains in the cryptocurrency field, cashing out at the right time is a wise choice. This is not just advice, but a valuable lesson learned from personal experience. Early in my career, I missed opportunities due to indecision, which I deeply regret. Although market conditions change rapidly, the fundamental principles remain constant.

I gradually realized that choosing to cash out when the returns are sufficient to change the quality of life brings benefits that cannot be measured in money: permanently improving the living standards of yourself and your family and friends. Just imagine, being able to immediately improve your living situation by simply clicking the "Sell" button; how wonderful that would be. If you have such an opportunity, I strongly recommend that you seize it.

I am well aware of the temptation to wait for the best selling opportunity: one always feels that if they hold on a little longer, they can achieve higher returns. However, the truth is: the perfect timing is merely an illusion. The most successful traders I know have not achieved their current success by precisely timing every market peak; they have succeeded through consistent profits and maintaining liquidity. They understood early on that cashing in profits is a necessary condition for long-term survival in this market.

One of my most open-minded understandings is that opportunities always exist. This mindset helps alleviate the fear of missing out that traders often have when considering taking profits. Indeed, it may be hard to let go of well-performing positions, but keep in mind: continuing to hold out of fear of missing an opportunity may come at a higher cost in the long run.

I often think about what it means to reach "escape velocity": that is, a financial situation that allows you to take planned risks without threatening the stability of your life. Once you reach this level, you can truly start participating in the market and give it your all.

Retirement funds needed: how much is considered sufficient?

As someone who has long been concerned about retirement issues, I often think: how much money is really needed to retire comfortably? Although the media often exaggerates the amount required, I believe that for most people, between $1 million to $2 million may be sufficient. Let's first analyze this issue from the perspective of traditional finance.

Data from 2022 shows that the average retirement account balance for those aged 65 and older is only $232,710. In contrast, suddenly having a retirement fund of $1-2 million is no small amount, right? In fact, only about 3.2% of retirees have savings exceeding $1 million.

I understand that you reading this article may not be 65 years old yet, and you hope to retire before you turn 65. When I first heard that Americans think they need $1.46 million to retire comfortably, I was very surprised. But then I realized a key point: this number is just an average. Everyone's needs may vary significantly.

Let's consider the 4% withdrawal rule, which is a common guideline for retirement planning. If you have $2 million in savings, you can withdraw $80,000 per year. For many people, this is enough to maintain a comfortable standard of living. Your retirement needs largely depend on the lifestyle you expect. Are you planning to travel the world, or are you content with simpler pleasures? The Bureau of Labor Statistics reports that in 2021, the average annual expenditure for those aged 65 and older was $52,141. Savings of $1-2 million can easily cover this expense.

The choice of residence after retirement can greatly affect the efficiency of your wealth utilization. A retirement fund of $1 million may feel tight in New York City, but it can provide a fairly comfortable life in a small town or abroad.

The influence of psychological factors

Knowing that you have deposits of 1-2 million dollars can greatly reduce financial pressure and allow you to truly enjoy retirement.

Ultimately, whether 1-2 million dollars is enough for retirement depends on individual circumstances. For many of us, this is not only sufficient but even exceeds our expectations. The key is to start saving early, live within your means, and focus on things that truly bring happiness. Remember, retirement is not just about money; it's about creating the life you aspire to, regardless of whether there are millions of dollars in your bank account.

I deeply understand the views of market experts. Once you deposit enough life-changing funds into a bank or invest in stable assets like real estate, you can participate in the market with a more relaxed mindset.

What is meant by "easier" here does not imply making money more easily, but rather that your mindset will be more relaxed. You can calmly make wiser decisions and focus only on genuinely valuable trading opportunities. Even if you encounter losses, you will not lose everything because you have already built a safety cushion.

As market experts say: "The real fun starts here." From this perspective, this market cycle is more interesting to me. Even if everything goes to zero, at least I have a safe backup. That said, some people work more efficiently under pressure, but I don't think this applies to most people.