Retirement; like your parents, but way cooler
In 1991 Billy and Akaisha Kaderli retired at the age
of 38. Now, into their 4th decade of this
financially independent lifestyle, they invite you
to take advantage of their wisdom and experience.
Cryptocurrency Is Making its way into Retirement Plans
Image on Unsplash
Cryptocurrencies are an attractive asset
that promises significant profitability. They have been steadily growing with
some tokens like Bitcoin achieving new all-time highs. Such crypto achievements
have led many people to consider adding a cryptocurrency investment to their
Cryptocurrency investments offer you a
chance to diversify your retirement portfolio with various crypto investments
along with your traditional financial assets like stocks and bonds. You can
generate high returns from investing in crypto as part of your 401K. Combining
your other 401K plans like mutual funds and exchange-traded funds with a crypto
401K plan can reduce risk and potentially improve the overall performance of
your retirement portfolio.
You also have the ability to diversify the
crypto investment in your retirement portfolio. For example, you could choose to
invest in Solana after doing your research and understanding the conversion rate
of SOL to USD. Alternatively, you could invest in other industries and projects
supported by the blockchain like real estate, blockchain infrastructure, NFTs,
or smart contracts.
2. Hedge Against Inflation
Cryptocurrencies exist on a decentralized
blockchain shielding them from being controlled by a single entity or a
government. Conversely, fiat currencies are prone to government
policies that may
devalue your retirement money. If you are in a region experiencing
hyperinflation, you can protect your retirement money from losing its value by
converting it into cryptocurrency.
The borderless nature of crypto can allow
you to transfer them across international boundaries easily without restrictions
on capital movement or currency exchange imposed by governments. This is made
possible because you can use cryptocurrencies from anywhere in the world, as
long as you have an internet connection. Incorporating crypto investments in
your pension scheme can hedge some of your pension assets against government
actions or inflation.
3. Changes the Way We
Cryptocurrency transactions are recorded on public ledgers that cannot be altered or illegally manipulated by anyone making
them transparent and secure pension plans. You also get direct ownership and
control over your pension crypto assets unlike in traditional systems where
financial institutions manage and control your retirement account.
Crypto pensions offer you a way to access
your money without having to go to the bank. It also gives you the ability to
send money to loved ones who don’t use traditional banking without having to go
through a centralized authority. Your loved one can receive the funds you’ve
sent often within minutes because of the speed and efficiency of crypto, unlike
traditional banking which is vulnerable to intermediary delays with different
4. Crypto Like Bitcoin Has
Increased in Value
Bitcoin has significantly surpassed the
return value of traditional 401K investments such as mutual funds over the past
decade. Its scarcity and
limited supply of 21 million coins have increased its
demand as more people recognize it as a store of value. A lot of investors have
capitalized on Bitcoin’s volatile price movements to generate profits further
Holding crypto in your retirement account
can also help you cut down on your tax liability crypto investment gains that
you can't evade with traditional 401K investment options. Crypto has grown from
a fringe movement to a widely accepted appreciable asset whose growth is likely
to be replicated in the future.
5. Empowers You to Benefit
Cryptocurrency investments in your pension
expose you to emerging crypto technologies and concepts in the blockchain space.
Having crypto investments in your retirement portfolio signals trust and
confidence in cryptocurrency projects that can influence other investors to
align with these promising projects. You get to keep up with emerging blockchain
trends and contribute insights to discussions about crypto innovations.
By incorporating crypto investments in your
retirement portfolio you position yourself to diversify your assets and also
partake in the ever-evolving blockchain world. While cryptocurrencies are highly
volatile, making an informed investment to add to your 401K portfolio, can
reduce the overall risk in your retirement funds. It's important that you do
your research and assess your risk tolerance so that you can evaluate whether
cryptocurrency is a smart investment for your personal retirement goals.
About the Authors
Early Lifestyle appeals to a different
kind of person – the person who prizes their
independence, values their time, and who doesn’t
want to mindlessly follow the crowd.
Retire Early Lifestyle Blog
About Billy & Akaisha