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Some Big Things To Consider If You Plan On Retiring On Bitcoin

Retirement can bring you wonderful things. The most precious of these is the freedom to do what you want, when you want.

Author:Gordon Dickerson
Reviewer:James Pierce
Jul 26, 2022
Retirement can bring you wonderful things. The most precious of these is the freedom to do what you want, when you want. However, many people were so busy raising a family and building a career during their working years that they forgot to make enough money to retire on. Or, retire in a lifestyle to which they’ve become accustomed to, anyway.
If you happen to fall into this trap, there is one sure way to dig out of your financial hole. If you’re 62 years of age or older, have lived in your family home for decades, and paid the mortgage on time every month, you can apply for a reverse mortgage. If approved, you can potentially tap into hundreds of thousands of dollars’ worth of built-up equity.
You can take your proceeds in one lump sum payment, or you can receive equal monthly disbursements. It’s all up to you. What’s even better is that you need never pay the loan back until you leave your house, or you die. To find out how much of a reverse mortgage you might qualify for you can use this reverse mortgage calculator.
But what if you haven’t yet reached retirement age, and find yourself staying up all night worrying over not having enough cash to survive on when the day comes for you to pack up your office? You can do your best to skimp and save as many dollars as possible, or you can do something a little more revolutionary. You can begin to invest in Bitcoin.
According to a new financial report, Bitcoin or BTC, has most definitely emerged as one of the most popular and lucrative investments in recent years. It’s even more popular than the “meme stocks” that that literally broke the internet in 2021.
Because BTC is one of the most well-known and earliest of the cryptocurrencies or digital assets, it’s become the most popular. What’s the truth about BTC according to some financial experts? In the long run (2 to 5 years), you can expect to make a large profit with Bitcoin.
That said, should you count on it entirely to fund the bulk of your retirement portfolio? The short answer is “probably not.”

Avoiding Putting Your Senior Years at Risk

For certain, when you retire, you will require funds outside of your monthly Social Security payment in order to keep up with normal living expenses, including out of pocket medical costs which can add up quickly. This is where your investments/assets and cash savings come into play.
While you should take a serious look at adding BTC to your retirement portfolio, despite its apparent volatility (currently Bitcoin is down around 70 percent from its 2021 high due to a bear market), you should not do so at the expense of your other investments.
To repeat, while BTC has gained tremendous value since its beginnings in 2008, it is “a notably volatile investment.” The same goes for all cryptocurrencies, many of which you should not invest in at all.
Some experts will tell you that because BTC appears to be so risky, it should not be the only asset you invest in. BTC can decrease rapidly in the short term, but in the long term it will almost surely increase in value. However, no one is fully aware of the macro issues that can affect its price in the long run.
For instance, if government tax regulations are established that make a sizeable investment in BTC no longer so attractive, its price will plummet which could diminish your portfolio substantially. In a word, that’s a risk you should not take.
On the other hand, there are financial experts like Michael Saylor and Max Keiser who insist you should not worry about the price of BTC in the short run, but look at it as “digital property” that will only increase in value in the long-term.

Diversification is Key

Traditionally speaking, stocks have long been considered the most viable long-term investment for your retirement portfolio. Naturally, placing your entire “nest egg” into a single stock is a bad decision. In the same vein, it’s probably not a good idea to place all of your retirement cash into one single digital asset, even if it is BTC.
It’s said that if you are planning on purchasing Bitcoin for the long haul into your senior years, you might make certain it comprises a smaller portion of your entire portfolio. You should spread out your investments across a variety of asset classes also.
One good option is to maintain a portfolio that includes the following investment mix:
  • Stocks
  • Bonds
  • Real Estate
  • REITs or real estate investment trusts
  • Crypto Assets including BTC and Ethereum or ETH
This is said to be a safe setup that offers protection just in case one asset class happens to lose some or most of its value for one reason or another. For instance, bonds are said to be less volatile than stocks, so it’s a decent idea to own a comfortable amount of them as your retirement years close in on you.
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Gordon Dickerson

Gordon Dickerson

Gordon Dickerson, a visionary in Crypto, NFT, and Web3, brings over 10 years of expertise in blockchain technology. With a Bachelor's in Computer Science from MIT and a Master's from Stanford, Gordon's strategic leadership has been instrumental in shaping global blockchain adoption. His commitment to inclusivity fosters a diverse ecosystem. In his spare time, Gordon enjoys gourmet cooking, cycling, stargazing as an amateur astronomer, and exploring non-fiction literature. His blend of expertise, credibility, and genuine passion for innovation makes him a trusted authority in decentralized technologies, driving impactful change with a personal touch.
James Pierce

James Pierce

James Pierce, a Finance and Crypto expert, brings over 15 years of experience to his writing. With a Master's degree in Finance from Harvard University, James's insightful articles and research papers have earned him recognition in the industry. His expertise spans financial markets and digital currencies, making him a trusted source for analysis and commentary. James seamlessly integrates his passion for travel into his work, providing readers with a unique perspective on global finance and the digital economy. Outside of writing, James enjoys photography, hiking, and exploring local cuisines during his travels.
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