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Should You Include Crypto in Your Retirement Plan?

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With Bitcoin’s remarkable ascent and persistent appeal, it’s unsurprising that many investors are contemplating including cryptocurrencies in their investment mix. In fact, those planning for retirement can now leverage tax-efficient accounts such as self-directed IRAs to invest in cryptocurrencies and other non-traditional investment options.

However, a recent U.S. Department of Labor (DOL) report suggests otherwise. This report was released concurrently with President Joe Biden’s efforts to establish regulatory frameworks for digital assets like cryptocurrencies. It warns that these digital currencies may not be a suitable addition to your retirement plan.

Does Crypto Have a Place in Your Retirement Fund?

Incorporating cryptocurrency into conventional retirement funds is typically not permitted. Specific self-directed individual retirement accounts (IRAs) exist that enable investment in Bitcoin and other cryptocurrencies. However, these accounts are costly, and the regulatory landscape is complex. If you’re contemplating such an investment, do so outside your regular retirement fund. It’s crucial, though, to comprehend the associated risks.

Due to their immense volatility, cryptocurrencies can offer significant short-term returns with well-timed investments. Yet, their medium to long-term performance remains unpredictable. Cryptocurrencies are new, and their long-term functionality is still uncertain. Global regulators are still grappling with how to manage them while market fluctuations persist.

This doesn’t necessarily imply cryptocurrencies won’t exist a decade or two from now. Financial institutions have started integrating blockchain technology and individual digital currencies.

Digital assets carry higher risks than stocks, bonds, and mutual funds. If your brokerage firm collapses, your traditional investments are safeguarded by Securities Investor Protection Corporation (SIPC) insurance.

If you hold an account with a cryptocurrency exchange, such as a crypto savings or trading account, there’s no fallback plan in case the platform or the currency fails. Even in a traditional brokerage account or self-directed IRA, cryptocurrency isn’t covered by SIPC insurance. As a result, the conversion of BTC to USD or other fiat currencies could be more volatile and risky.

Reliable Retirement Savings Options

Your retirement savings strategy may hinge on your distance from retirement, prompting you to favor certain investments over others. Those in their 20s and 30s engage with riskier assets as short-term market volatility will have less impact on them. However, if you’re nearing retirement within the next five to ten years, focus on safer investments less prone to a decrease in value. Here are some dependable alternatives to cryptocurrency for your retirement portfolio:

  • Stocks: Individual stocks are included in an IRA. This option is, however, unavailable in a 401(k) or similar employer-backed retirement account. If you opt for stocks, ensure your portfolio is diversified across various sectors like technology, consumer goods, energy, utilities, etc.
  • Bonds: Bonds generally yield lower returns than stocks but carry less risk. If you’re younger or have a higher risk appetite, a portfolio heavily skewed towards stocks could be suitable. However, increasing your bond allocation is usually advised as you approach retirement.
  • Exchange-traded funds: ETFs are traded on the New York Stock Exchange or NASDAQ stock exchanges. These funds gather money from investors and diversify their investments depending on the fund type.
  • Mutual funds: Mutual funds function similarly to ETFs but aren’t traded on major stock exchanges. They offer an efficient way to diversify your portfolio without needing you to manage all the intricacies.
  • Real estate: Real estate can serve as an excellent repository for retirement funds due to its low correlation with the stock and bond markets. This means it doesn’t react identically to economic conditions. For instance, a plummeting stock market won’t necessarily affect your real estate investments. You can directly invest in properties or utilize real estate investment trusts to achieve your objective.


There are a few distinct routes for individuals to take in regard to crypto and retirement planning. However, as with any investment strategy, due diligence must be carried out to ensure that your financial future is well secured. Whether it is by diversifying traditional retirement plans or fully incorporating digital currencies, it is up to the precision of the investor on how these decisions play out.


Sneha Shah

I am Sneha, the Editor-in-chief for the Blog. We would be glad to receive suggestions, inputs & comments on GWI from you guys to keep it going! You can contact me for consultancy/trade inquires by writing an email to

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