5 Reasons You Need Crypto in Your Retirement Portfolio

You may have heard of the “60/40” rule for retirement accounts.  In the past, conservative brokers have traditionally recommended putting 60% of your assets in stocks and 40% in bonds.
Just take a look at how that advice is playing out in today’s economic climate.  If you are continuing to follow the 60/40 rule, think again.

Bonds v. Crypto

Bond yields have seen an alarming plunge and stocks are still near all-time highs, even with dips caused by the coronavirus panic.  Volatility levels have been rising and are showing no signs of slowing down as the world braces for an inevitable recession. Not exactly the time to have all your money in stocks and bonds, right?

Guess what?  By 2020, your portfolio with a 1% crypto stake has outperformed the traditional 60/40 portfolio by 20 percent.  The most exciting part? This is just the beginning.

Last year, CNBC reported that the United States government’s Social Security program is set to be insolvent by 2035.  If you’re in your 50’s or younger, don’t count on much help, if any, from Uncle Sam in your golden years.  Likewise, the era of company-sponsored pensions is long gone and 401(k) matches are getting worse or disappearing completely.

In fact, “According to some reports, many people under 40 believe they will never retire,” says Morgan Steckler, cryptocurrency retirement fund expert of iTrust Capital.  But for those that are smart enough to get into crypto now, “it could still lead to life-changing returns and give those people that option to retire if they so choose,” Steckler added.

A 2018 study by Ramsay Solutions exposed what could be considered a crisis in this country, revealing that roughly half of Americans are not saving for retirement.  Another study by Bankrate predicts that half of all working households will experience a decrease in their standard of living during their retirement. Is that really what you’ve been working towards and planning for your whole life?

All of these facts aren’t going unnoticed.  We’ve recently seen Fairfax County in Virginia take the groundbreaking step of investing millions of its pension funds into cryptocurrencies. Even the IRS is on board, having approved crypto IRAs for the general public.

It’s never too late to start planning for your retirement, and it’s still not too early to start investing in cryptocurrency.  If you haven’t seriously considered adding crypto to your portfolio yet, now is the time. Don’t just take our word for it, though.; Let’s take a look at the top reasons why crypto should be a part of your retirement plans.

Diversification
We’ve all heard the saying, it’s as old as the concept of investing itself: “Never put all your eggs in one basket.” Diversification helps you minimize the risk associated with a single asset, yet still allows you to enjoy the growth of each.

The same applies to your retirement account.  The old-fashioned strategy of only putting stocks and bonds in your tax-deferred retirement accounts is becoming obsolete.  The IRS is fully on board with precious metals, real estate, and cryptocurrencies as part of retirement IRAs.

Any financial advisor worth their salt will recommend diversifying 5-10% into precious metals, and many are now suggesting the same with cryptocurrency.  And why wouldn’t they?  As an exciting new asset class that has seen consistent and explosive growth for a decade, it’d be irresponsible not to.

Protection from the Government
Pick a cryptocurrency.  Bitcoin, Ethereum, Ripple, etc.  It doesn’t matter which you choose, no government can control any of them.  It’s literally impossible for Uncle Sam to seize your Bitcoins from your wallet against your will.  They’d need your private key to access your funds.  If you didn’t give it to them, then it would take the most powerful computer on earth BILLIONS of years just to crack it.

The government can’t print more digital currency either as they can with paper bills.  Bitcoin, for example, has a set amount of coins, period. All that will ever exist were created with the currency itself.  Outside forces are unable to manipulate it, unlike the Dollar, Euro, Yuan, etc.

With crypto, you’re protected from other nefarious third parties, as well.  Cryptocurrencies don’t use middlemen, so transactions are direct between two parties.  This means that it’s easier, faster, and safer overall.

Long-Term Growth Potential
Despite the fact that we have already seen an enormous amount of growth in the crypto space, we are still in its relative infancy.  The other major asset classes out there such as precious metals, real estate, stocks, and bonds have all had a head start of hundreds or even thousands of years.

Bitcoin has now been around for roughly 10 years, which puts it in a uniquely advantageous position.  We’re currently in the sweet spot where it has a long enough track record to consider it an established and stable commodity, but it’s still in its relative infancy compared to other investment options.

The subsequent upside?  There’s still tremendous growth potential.  Many have been predicting six- and seven-figure values for a single Bitcoin in a few years.  Sound crazy? It’s most of the same people that predicted the rise from a few hundred dollars up to the $10,000 level that we’re hovering around today (and PS, most of them are now filthy rich).

Crypto is Resilient
Back in 2013, the LA Times famously published an article where they smugly declared the death of Bitcoin.  How did that work out for them? The article has aged quite poorly, to say the least.
Bitcoin has taken beatings both in the media and in the markets.  Detractors and naysayers have been around since the beginning, and they have continually been proven wrong. Nowadays, if you’re blindly slamming crypto, then prepare to be considered out of touch.

One argument you’ll hear against Bitcoin is the volatility of the market.  Earlier this decade, Bitcoin actually lost 70% of its value practically overnight.  The naysayers won’t tell you how it quickly bounced back and shot up past its previous highs, though.  It’s the same thing that happens every time. Compare that to the stock, bond, or real estate markets, which can take years just to creep back up to previous levels.

It’s Already Mainstream
As we just saw, there’s still a large crowd of crypto-doubters out there.  Another one of their arguments is that Bitcoin and other altcoins are still lacking in mainstream adoption.  When you look at the evidence and trends however, you’ll see that this point just isn’t true anymore in 2020.

Want to order something from Overstock.com?  Grab a bite from a restaurant?  Purchase sports tickets?  A computer? Or a trans-Atlantic flight? Well, you’re in luck.  Some of the biggest companies and organizations in the world accept Bitcoin as payment, including Microsoft, Dell, Tesla, the NBA, and Virgin Galactic.  People are even buying houses with crypto these days.

It’s not even a question anymore.  Bitcoin has already taken a foothold in the mainstream.  Add to this the fact that on a global scale, more people have access to the internet than they have to banks or other currency systems.  This is especially the case in developing areas such as Africa, where hundreds of millions of people will gain internet access for the first time in the coming decades. ; Given that the supply of Bitcoin is fixed, we’re going to see a massive increase in demand as third world nations develop.

Marcus Swanepoel, Chief Executive of Luno, explains how “Cryptocurrency is uniquely positioned at the apex of technology and finance. It has been lauded as a potential game-changer for society.”  Expect prices to rise accordingly.

It’s Not Too Late
The price of Bitcoin has seen incredible growth, but it’s not too late to get in at what is still a relatively low level.  By investing in cryptocurrencies, you’re not only protecting your portfolio from the volatility of the markets, but you’re setting it up for significant future growth, as well.  Plus, you can save big on taxes by using cryptocurrency to contribute to your retirement IRA. It’s the best of both worlds.

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Benefits of Using Alternative Investments

Regal Assets

When there is a drop in the stock market, investors and retirees have to search for some alternative ways to invest their money and protect their future by diversifying their investment portfolios. In this situation, many investors and retirees opt for investing in alternative investments to provide them a way to protect them from the instability caused by fluctuating stock markets, as well as to diversify their investment portfolio.

They will have to look for a few alternative investment services that can help them in investing their assets. For this reason they used to search for the best gold investment company or the company dealing in Bitcoin invest
etc.

While investing in non-traditional or alternative assets investors have to be very careful as there can be several scam schemes that promise to make you rich quickly. However, before making up their minds for investing in alternative options they should go through the information provided herein.

What Are Alternative Investments?

Alternative investments are investments other than a number of traditional investment opportunities like bonds and stocks etc. Some choices for alternative investments may include precious metals, commodities,
startups, real estate, private equity, hedge funds, cryptocurrency and venture capital along with various other options.

What to Expect From Alternative Investments?

According to various expert portfolio advisers and managers, alternative
investments are different from traditional investments in terms of the
rate of return and liquidity. Diversification of the portfolio can also be one of the main reasons to add alternative investments into your portfolio, as they can provide a protection cover from the market inflation as the chances of their connection with stock market are also low.

The experts also say that alternative investment opportunities that are recommended may include precious metals or real estate as good alternatives to diversify your portfolio, especially when stock markets are
experiencing a downturn. But the benefit of exposing the money to the real estate or precious metals depends mainly on the bearing capability of the investors for the volatility in their life as well as in their portfolio.

According to a Texas based investment consultant and service provider to the owners of Solo 401(k) and individual retirement accounts, the benefit of
alternative investments depends on better positioning of your investments so that they can bear the recession in the market.

Bitcoin Alternative Investment
The increase in value of Bitcoin.

Things to consider before investing in alternative investments

According to experts some aspects to be considered before investing in
alternative investments may include:

Possibility of higher returns

Less liquidity in comparison to the funds traded through exchange and stocks

Possibility of higher returns in alternative investments

Though the risk is higher in investing in alternative investments, they also
promise better returns. However due to availability of different types of assets the rate of return may vary widely.

According to experts, you can expect a return of 10 times of your initial
investment while investing in a startup, but it also includes the possibility of losing your money after a payoff once only. However, if you invest in real estate or precious metals, the possibilities of losing money can be very low as they may have some value even if the market drops. Though you may have to pay somewhat higher fees for investing in alternative assets, or initial minimum investment can be higher than stocks, you can still expect a share of profit up to 20% after a lockup period of 2-3 years in most cases,
depending upon the type of asset you have invested in.

Gold Investment
Gold Investment for diversification

Less Liquid as Compared to ETFs and Stocks

According to experts, the lock-in period of some alternative investments does not allow the investors to sell their assets. Moreover, it is not easy to sell certain assets as they are not as liquid as ETFs or stocks are.

According to a study on the benefits of alternative investments for retirees and investors, some benefits of such investments may include:

    • Reducing the effect of the volatility of the market:

When you invest in traditional investments like stocks and other instruments, there is a constant risk of a drop in market value due to fluctuations in the market conditions. But when you invest in alternative assets, then such things can be avoided. You can invest in the assets that are
least related to the fluctuations of public markets.

Many investors usually react very quickly when there is any change in the public market because they are not able to understand the reasons behind
those changes. In such conditions, alternative investments can create a hedge against such risks for the common investors, because they have a
long lock-in period which reduced the risk of quick reactions.  Investing non-liquid alternative investments will help in avoiding the losses caused by behavioral changes or fear-based selling.

Reduce the cost of transactions:

The turnover of high amounts is required for investing in short-term investments which can increase the cost of these transactions. Many people invest in short-term investment to earn high profits in a short time, but
most of their profits are equalized by the costs of managing and maintaining their investment portfolio. So to earn higher profits, they will have to invest in the portfolios which can help in reducing their transaction costs. Though the cost of investing in alternative assets can be higher than traditional assets, the best part is that they will not increase the cost of transactions and maintenance of their investment portfolio along with allowing them to earn a higher yield.

Benefits in taxation:

There are some tax benefits by investing in alternative assets as they are for long terms. Though you have to pay capital gains tax on the income of longer-term investments but this tax is less than the tax paid on the investments for the short term. Moreover, you have to pay capital gain tax on the gains released by the asset holder. In this way, long term investments in alternative assets will protect you from the taxes paid for capital gained from short term investments.

So, to diversify your portfolio, retirees and investors should invest in legitimate assets.  RA Wealth Partners can be one of the legitimate alternative assets in which you can invest for this purpose. This program has been introduced by Regal Assets, one of the trusted companies in the
field of financial investments. They allow them to earn higher returns safely by investing in precious metals.