Millennials Are Buying Cryptocurrencies to Save For Retirement
Among millennials, the cryptocurrencies investment trend is gaining momentum for retirement purposes. Moreover, as tech-savvy millennials are shunning traditional banking methods, innovative startups are creating new retirement solutions powered by blockchain and artificial intelligence technologies.
Millennials Are Reshaping the Retirement Planning Industry
Most millennials, people born between 1981 and 1996, are not saving for retirement. For example, in February 2018, the National Institute on Retirement Security released a study, which concluded that “95 percent of millennials are not saving adequately for retirement.” Then there’s the fact that over 66 percent of working millennials have nothing saved for retirement.
However, a growing number of millennials are investing in cryptocurrencies. For 21.2 percent of college students, the urge to buy cryptocurrencies even involves using their financial aid money, concluded a survey conducted by The Student Report. Rachel Wolfson writes on Bloomberg:
Interestingly enough though, one of the main reasons millennials are investing in cryptocurrencies is to save for retirement funds.
Indeed, millennials are attracted to technology and cryptocurrencies. According to a survey conducted by CREALOGIX, millennials are increasingly turning to cryptocurrencies, while rejecting traditional methods of banking and payment.
Blockchain and Robot Technology Are Powering New Retirement Tools
Innovative startups are redefining the retirement landscape by using blockchain technology and artificial intelligence to create new retirement savings solutions.
For example, Auctus offers a retirement planning platform that focuses on both traditional assets and cryptocurrency investments by using smart contracts and robo-advisory technology. According to the company website:
The Auctus Platform brings retirement savers from around the world together, providing a trustless marketplace where users can create and exchange tailored retirement apps and services.
On the other hand, financial experts are already debating the pros and cons of including Bitcoin and other cryptocurrencies in retirement savings instruments, such as 401 (k) plans.
For example, Charles Hodge, Investment Services Consultant at Milliman, concludes, “At this time, Bitcoin and other currencies are not appropriate for retirement sponsors.” Rick Pendykoski, founder of Self-Directed Retirement Plans LLC, believes that Bitcoin should not play a significant role in a retirement plan. However, Pendykoski advises:
Investing in Bitcoin works best if you already have a healthy mix of short-term and long-term assets in your portfolio, and are investing for retirement in an IRA or other tax-advantaged plan.
Investors can already put their Bitcoin, Ethereum, and other cryptocurrencies in an IRA. BitcoinIRA facilitates the transfer of an IRA or 401K fund to a Bitcoin IRA. BitcoinIRA claims to have already processed 300 million USD in the last 12 months.
Raphael Vantroost, CEO of Auctus, believes that cryptocurrencies are encouraging millennials to invest. In this regard, Bloomberg quotes Vantroost, who says:
Bitcoin and cryptocurrencies serve as some of the first investments for many millennials. This could be because the younger generation is tech-savvy, but it could also be due to a lack of alternatives.
Do you think Bitcoin and other cryptocurrencies will become a mainstream retirement investment opportunity? Let us know what you think in the comments below.
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