Planning for Retirement: Investing in Cryptocurrency
As you plan for retirement, you will come across many investment opportunities. One of these opportunities is one of the latest in investment trends: Cryptocurrency. You may have friends or family who are investors, and due to crypto’s reputation for high risk and high reward, they may have either earned a lot of cash or lost a lot of it. Is cryptocurrency worth it as an investment geared toward retirement? Keep reading to learn more about cryptocurrency, planning for retirement, and how investing in gold for retirement can help you with all your investments.
What is Cryptocurrency?
According to Forbes, cryptocurrency is a digital, encrypted, and decentralized medium of exchange. Unlike the U.S. Dollar or the Euro, there is no central authority that manages and maintains the value of a cryptocurrency. Instead, these tasks are broadly distributed among a cryptocurrency’s users via the internet.
You can use crypto to buy regular goods and services, although most people invest in cryptocurrencies as they would in other assets, like stocks or precious metals. While cryptocurrency is a novel and exciting asset class, purchasing it can be risky as you must take on a fair amount of research to understand how each system works fully.
Bitcoin was the first cryptocurrency, first outlined in principle by Satoshi Nakamoto in a 2008 paper titled “Bitcoin: A Peer-to-Peer Electronic Cash System.” Nakamoto described the project as “an electronic payment system based on cryptographic proof instead of trust.”
What the Analysts Say
According to Investopedia, the U.S. Department of Labor has warned the retirement industry to exercise “extreme care” when investing in crypto, pointing out that plan fiduciaries have a legal obligation under the Employee Retirement Income Security Act (ERISA) to protect people’s retirement savings. But some people are more comfortable with risk than others, and the established players, like Fidelity Investments, are taking notice.
This year, Fidelity Investments, the largest retirement plan provider in the United States, became the first to add Bitcoin as an investment option in its 401(k) plans. Under their plan, investors will be able to allocate up to 20% of their retirement savings to bitcoin. But the individual fiduciaries may establish their own employee contribution limits and allocation maximums. However, just because it’s possible to invest in an asset like crypto for retirement doesn’t necessarily make it a good idea.
An article by CNBC states that Fidelity Investments and ForUsAll, which administer workplace retirement plans, began offering cryptocurrency such as bitcoin to 401(k) investors within the past few months. They appear to be the first companies to do so. However, that doesn’t mean all 401(k) plans will offer crypto.
Employers must use an administrator that grants access and then opt to make crypto available to workers. Some may hesitate after a U.S. Department of Labor warning this year to exercise “extreme care” before adding crypto alongside more traditional stocks and bonds funds.
Time Magazine says that Bitcoin and ethereum are down more than 50% from their all-time highs in late 2021. While there have been small surges in recent weeks, the crypto market as a whole is largely stalled. While no one knows for sure, some experts say crypto prices could fall even further before any sustained recovery.
Bitcoin hit multiple new all-time high prices in 2021 — followed by big drops — and more institutional buy-in from major companies. Ethereum, the second-biggest cryptocurrency, notched its own new all-time high late last year as well, and then crashed below $900 in June, its lowest level since the start of 2021. U.S. government officials and the Biden administration have increasingly expressed interest in new regulations for cryptocurrency.
Secure Retirement with Priority Gold
Investing in cryptocurrency for retirement can be tricky. If you choose to do so, one of the best ways to protect your investment is by investing in gold. Gold acts as an inflation hedge and the value of gold rises as the value of the dollar decreases. This allows you to ensure your retirement funds are safe, no matter what you choose to invest in. If you are ready to invest in gold to protect your savings and secure your future, we can help. Priority Gold is one of the most trusted precious metals dealers in the United States with BBB A+ Rating, AAA Rating with Business Consumer Alliance, and 5 Stars Rating with TrustLink.
We specialize in providing precious metals investment services with Security, Liability, and Great Convenience for customers. Our team is committed to helping to streamline their precious metals purchases at a fair price, selecting the right precious metals portfolios, and meeting their important financial objectives.
We offer Free Storage for qualifying Gold & Silver IRA accounts, a fast & easy gold buying process, and smooth IRA Transfer. And gold shows up on schedule. Priority Gold guarantees the highest standards of customer service, which comes with honesty, professional conduct, and an Ethical Code of Business.
For more information, visit us at prioritygold.com