Bitcoin For Your IRA Or 401k?
Bitcoin has become a popular way to hold your money in a platform that is secure and safer than paper money. Many people have been considering Bitcoin as a platform for investing and some people have been moving their investments over to Bitcoin. So how can Bitcoin be turned into an investment opportunity? Let’s take a look.
A great way to set up a retirement plan with Bitcoin is to invest in a 401K or IRA. While most IRAs are invested in stocks there are other options. In fact there are a lot of options out there. The government has a list of items that are not allowed to be part of an IRA/401k, and it is surprisingly small.
- Metals and coins (With some exceptions)
- Artwork and rugs
- Tangible personal property
What Is Bitcoin?
Bitcoin is a digital currency that started back in 2009. When you invest in Bitcoin, you are purchasing an amount of digital currency, similar to the process of buying precious metal. You will have an account number and authorization number. The value of a bitcoin goes up and down based on a variety of factors, just like a stock or physical money.
The Benefit of Bitcoin
One of the biggest benefits of Bitcoin is that it is digital and can be accessed from anywhere but at the same time it is extremely secure. The encryption used for Bitcoin is very high level. That means that the chances someone is going to get access to your investment is very slim.
The second reason that Bitcoin is such a good investment platform is that it has shown enormous growth. When first released in 2009, Bitcoin was worth less than one dollar. Now the value has grown to past $1,100 per 1 Bitcoin. While the price for bitcoin may go up and down, slightly, it has never moved too far.
How To Start A Bitcoin IRA
The first step to investing in a Bitcoin IRA is finding a place that will accept such an IRA. They aren’t as common as they could be because this type of account is still relatively new. There are however, more and more companies starting to accept Bitcoin as an investment type. Regal Assets is an example of a major IRA custodian that accepts Bitcoin as a form of investment.
To Buy Or Not To Buy?
Whether to buy a Bitcoin IRA or not is ultimately your decision. You have to take all of the factors into account and determine whether it is something that you want to do or not. While you might not see as much return as you would have if you invested in the beginning of Bitcoin there is still huge room for investment.
That being said, Bitcoin is like every other investment on the market today, there is room for market failure. Bitcoin is still a relatively new invention and while it has seen great success there is always the chance that the network could go offline. There is also the possibility that the value of a Bitcoin might go down and stay low for a long time. When you decide to make an investment that is a chance you take but with Bitcoin, many market analysts do not see it going anywhere any time soon.
It comes down to asking yourself two questions:
- Do I want to invest in a relatively new market?
- Do I feel comfortable with a limited selection of custodians?
If you end up wanting to start a Bitcoin IRA or Bitcoin 401k you will want to take the time to speak with a financial advisor. This will help you to understand whether or not the decision is right for you and the process in a more detailed view.
Many people who thought that Bitcoin would be a failure are kicking themselves for not investing in Bitcoin early on. That being said, it does have its ups and downs. Despite the downs, many investors have come to Bitcoin in order to create IRA’s or 401k’s to secure their retirement. In the end the choice is yours but it will be becoming a more and more popular retirement option as people worry about the value of the dollar.