Should you invest your retirement savings in crypto?


Cryptocurrency has become more and more mainstream as more and more investors add digital coins to their wallets. If you have a craving for crypto, you might be considering the idea of ​​investing in it for your retirement. And if it was, you wouldn’t be alone.

Almost 44% of American adults who have started saving for retirement say they have invested some of their nest egg in cryptocurrency, according to a recent FinanceBuzz survey. Additionally, nearly half of those who report investing in cryptocurrency for retirement confirmed that digital coins make up a large portion of their wallets.

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To be fair, this survey was conducted among 1,000 adults, so it is hardly representative of the American population as a whole. But he is interesting to see such a high percentage of respondents who bet on cryptocurrency for the long term.

Yet the question remains. Is cryptocurrency a smart retirement investment? Or do you prefer to put your long-term savings elsewhere?

It’s a matter of risk

During your working years, it’s a good idea to invest aggressively for retirement so that you can grow your money into bigger amounts. Then, as you approach retirement, it’s a good idea to switch to safer investments in your portfolio.

Now when we talk about investing aggressively we usually mean taking more risk in your nest egg. For many savers, that means stocking up on stocks or equity-focused index funds. But it could also include cryptocurrency.

That said, however risky stocks may be, cryptocurrency can be even more volatile. Worse yet, we don’t know what the future holds for crypto.

If regulations prohibit the use of digital coins as a payment option, it could wipe out the value of the cryptocurrency. This is a risk you may not want to take with your retirement savings.

In fact, as a general rule, it pays to adopt a buy and hold strategy for retirement, where you acquire stocks or other quality assets and hold them for many years, allowing them to take value. Cryptocurrency does not necessarily fit into this strategy.

Many people who buy crypto do so on a shorter term. And since digital coins haven’t been around that long, it’s hard to say if it’s a good idea to buy them now in the hopes of keeping them 30 years later.

Does this mean you shouldn’t be investing your retirement savings in cryptocurrency? No. But should we invest a lot of your nest egg in digital currencies? Probably not.

Cryptocurrency is still quite speculative, so a safer bet may be to keep a smaller portion of your nest egg in digital coins. Of course, how you allocate your retirement assets will ultimately depend on your personal tolerance for risk. And to be clear, there is no one-size-fits-all “correct” mix that you should be aiming for. But what are you should Make sure you understand the risks associated with cryptocurrency before betting heavily on it to fund your retirement years.


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