Most FIRE practitioners default to VTI and call it a day. Stack index funds, wait 20 years, done.
But there's a problem with that approach. You're accepting whatever return the market gives you, which means accepting whatever timeline the market dictates.
I ran an 8-year backtest comparing VTI-only portfolios against portfolios with bitcoin allocations. $100/week split between VTI and BTC at different ratios: 0%, 1%, 5%, 10%, 25%, 50%, 75%, 100%.
The results are striking. A 100% BTC allocation grew the portfolio almost 7x larger than 100% VTI. Even a 25% BTC allocation more than doubled the portfolio size compared to VTI-only.
The multiplier effect: every 1% increase in BTC allocation added 9.61% to total returns. That's not a small difference. That's the difference between retiring at 45 vs 55.
The tradeoff? Volatility. Bitcoin dropped 84%, 72%, 55%, and 77% during four major drawdowns in that period. But here's what matters: if you're consistently stacking sats through those drawdowns, you're buying more when it's cheap.
Early in your FIRE journey, volatility is a feature, not a bug. Your goal is to stack as much as you can as fast as you can. Deep drawdowns just accelerate that process.
VTI is a solid choice for saving. Bitcoin is a better one. The question isn't whether to allocate—it's how much you're comfortable with.
https://firebtc.io/p/supercharge-your-fire-journey
But there's a problem with that approach. You're accepting whatever return the market gives you, which means accepting whatever timeline the market dictates.
I ran an 8-year backtest comparing VTI-only portfolios against portfolios with bitcoin allocations. $100/week split between VTI and BTC at different ratios: 0%, 1%, 5%, 10%, 25%, 50%, 75%, 100%.
The results are striking. A 100% BTC allocation grew the portfolio almost 7x larger than 100% VTI. Even a 25% BTC allocation more than doubled the portfolio size compared to VTI-only.
The multiplier effect: every 1% increase in BTC allocation added 9.61% to total returns. That's not a small difference. That's the difference between retiring at 45 vs 55.
The tradeoff? Volatility. Bitcoin dropped 84%, 72%, 55%, and 77% during four major drawdowns in that period. But here's what matters: if you're consistently stacking sats through those drawdowns, you're buying more when it's cheap.
Early in your FIRE journey, volatility is a feature, not a bug. Your goal is to stack as much as you can as fast as you can. Deep drawdowns just accelerate that process.
VTI is a solid choice for saving. Bitcoin is a better one. The question isn't whether to allocate—it's how much you're comfortable with.
https://firebtc.io/p/supercharge-your-fire-journey