Collecting NFTs offers you plenty of ways to lose your mind.
During your first few days and weeks in this space, the learning curve and noise is enough to make your head spin.
Which Twitter influencer should you listen to? What should you buy? Which cat meme is hot right now? And what about those gas prices?
What if you buy into a project at the wrong time? What if you lose money? Should you double down and try again?
And there’s that constant fear of missing out on the next big thing.
The NFT space can be confusing, stressful, and addictive.
For sure, it can have a negative effect on your mental health. And on your bank account. And on your family life.
So… with all that negative stuff in play, how can you turn collecting NFTs into a pleasant, enjoyable and profitable experience?
The first thing to do is to find a niche… to decide on the type of projects that interest you most. My focus is on generative art. I wrote about this in an earlier post.
Next, you might want to sketch out a long-term plan.
The longer your time horizon, the less stress you’ll feel.
My time horizon is 5 years.
How come? Because that’s when I plan to retire.
I want to have put together a crazy-good collection of generative art by then.
After I retire, I’ll have less disposable income available to buy new works. But, more to the point, I’m hoping my NFT collection will help finance my retirement.
Imagine, for example, I have 20 pieces worth $50,000 or more by then. Or, one piece of that value in the first year of my retirement, a second piece for the second year, and so on.
If I want to, I can sell one NFT a year for 20 years. On top of my existing retirement savings, that will be a nice addition.
Truth be told, I don’t think I’ll ever want to sell my collection. But it will be there if I need it.
Your plan is going to be different, depending on your age and circumstances.
Maybe you want to save up for a house, or pay off student loans or a mortgage, or fund a new business venture.
The point is, if you have a clear goal and time horizon, you know what you’re aiming for when you buy and sell NFTs.
When you have a clear plan, day-to-day drama bothers you less.
With my plan in mind, I don’t get nearly as stressed about what’s happening with the next, super-hyped NFT.
I’ve missed out on plenty of projects. I should have bought a few Fidenzas when I had the chance. Even some Bored Apes. Bored Apes aren’t my focus, but they could have made me a ton of money which I could have then used to buy more art.
The point is, I’m not much bothered by the stuff I missed. Because mine is a five-year plan, not five-day plan. I have time to make things go my way, step by step.
Of course, all this could just be wishful thinking.
Here I am, talking about the value of NFT art five years from now.
As if I can predict the future. Which I can’t.
In five years NFTs may be almost worthless. Maybe the whole idea just fades away. Or maybe multiple governments legislate cryptocurrencies into oblivion. Or perhaps a solar storm burns the Internet to dust.
Nobody knows.
If my NFTs end up being worthless, there’s nothing I can do about that.
But I can plan ahead in the belief that my collection will be more valuable in five years than it is now.
And that belief is what will keep me sane during the ups and downs along the way.
I’m not saying I have all the answers. Far from it.
But I do know that I’m in a much calmer place in my mind now that I have a clear plan for building my collection of NFT art.
Having a plan might help you too.