During crypto bull runs, sometimes people dream of the day they can cash out their crypto and get their dream car: “When Lambo?” Other people in the cryptocurrency community advise against getting a car with crypto; instead, they say to borrow against your crypto to get these things. Although these are people I respect, I plan to go against their advice someday and use my crypto outright to pay for these things. While this may not be the best choice for everyone, this is what I hope to do someday. Here’s my plans for when my crypto moons and why I plan on doing it.
My Current Car Situation
Right now, we have a 2018 Kia Optima and a 2006 Chevy Cobalt with over 200,000 miles on it. The Kia has a car loan and the Cobalt was paid off years ago. The latter vehicle will probably need replacing at some point in the semi-near future.
I Don’t Like Debt
I’m not a fan of debt. While over the years, I’ve had to take out loans to get a reliable car to get to work or buy a house, I try to avoid it. I don’t like making payments. If I didn’t have debt, I could take the money I use for my car payment every month and use it to buy crypto. If I borrowed against my crypto, I’d be back to making payments again. Sure, it would be to myself, but I'd still be in debt to myself.
It’s Good to Take Gains
When cryptocurrency is up, it’s good to cash out on some of your crypto. That way, when it dips (and historically, it always has), you can at least say that you’ve gotten value out of your cryptocurrency. Years ago, I cashed out some Bitcoin to pay for the down payment on the house where I live. I cashed out some crypto to pay the mortgage payment when my husband was out of work for ten months. I cashed out DOGE to buy the laptop I’m writing this article on during the last bull run. If I hadn’t done all these things, I might have more crypto now, but because I’ve cashed out some, I can always say that I’ve gotten more money out of crypto than I’ve put into it. Even if it goes to zero, I can still say that. I’m not worried when crypto loses value (although I usually feel poorer).
When I’d Buy a Car
Even though I’d buy a car with my crypto, the choice of when to buy a big-ticket item with crypto is important. I’m not about to cash out my crypto now, when the market is almost 50% less than it was a month ago. When our stove broke a week ago, I cashed out silver to pay for a new one, not crypto. At the moment, I wouldn’t sell except in the case of an absolute emergency.
I also wouldn’t cash out ALL my crypto. When it comes to crypto trading, it takes money to make money. It might take longer, but I’d wait until the money it cost to pay off my car loan (or buy another one) was a small fraction of my crypto portfolio. We all talk about how sad it would have been to be the guy who paid 25,000 BTC for a pizza. I don’t know how much Bitcoin he had at the time, but if he had had a million crypto and spent 25,000 of it on pizza, it wouldn’t have been such a tragedy. So while I do plan to spend crypto when I reach certain milestones, I plan to wait until I have enough crypto so it won’t be a huge deal when I do.
Cryptocurrency is where I put most of the money that I otherwise would be saving. I’d rather save my money in an asset that is (usually) appreciating than save my money in an asset that is losing value by the day (fiat). When the day comes when we do pay off our car loan with cryptocurrency, we can take the money we’d otherwise be saving for another car and put it into crypto to someday get a car to replace our 2006 vehicle.
What about you? Have you ever cashed out crypto? Are you putting money into cryptocurrency right now to save for anything?