Very few people personally manage their retirement accounts and most Individual Retirement Accounts (IRAs) are held in trust for potential retirees. IRAs are expected to have a mix of investments and speculative investments. Conservative investments offer low-risks and low-rewards while speculative investments have potentially higher returns. However, some fund managers often load up IRA’s with low-risk investments such as bluechip stocks, mutual funds, CDs, and bonds among other things.
In order to have a diversified portfolio you might want to consider having a Bitcoin IRA Investment so that your retirement investment plan is not skewed towards conservative investments. It doesn’t matter if you have a Roth IRA, traditional IRA, SIMPLE IRA, or SEP IRA, you can have Bitcoin in an IRA plan and open up the possibilities of exponentially higher returns. In fact, you can rollover your 401k into Bitcoin if you want to increase your chances of exponential returns. This piece provides a simplified guide on how you can invest in Bitcoin for your retirement so that you can record potentially higher returns in your IRA.
What is Bitcoin?
Bitcoin a digital global currency designed to proffer better solutions to the problems ailing traditional currencies. Bitcoin is not printed or minted like other currencies; hence, any government, central bank or financial institution cannot influence its value. A Bitcoin wallet also has enhanced security not available with physical currencies. Bitcoin transactions are purely done electronically, the transaction costs are cheaper, and the transaction details cannot be intercepted by third parties.
Bitcoin adds diversification to your investment account because the fundamentals of its demand and supply are different from the fundamentals that influence other investments. Secondly, Bitcoin offers long-term tax benefits not available in other investments. For instance, Bitcoin in your IRA qualifies as tax-deferred funds.
The impressive return on investments that Bitcoin promises, its ability to hedge against currency inflation, and its tax benefit makes it smart for potential retirees to have a Bitcoin IRA investment plan.
How to make a Bitcoin IRA investment
One of the commonest routes to include Bitcoin in your retirement plan is to start a Bitcoin Self-Directed IRA through your retirement fund manager. The process is quite simple and fast, you’ll need to make an e-sign application for a self-directed IRA.
When you have successfully opened the account, you’ll then go ahead to fund the IRA by requesting to rollover your 401k into Bitcoin. You can also transfer funds from 401K to Bitcoin if you don’t want to do a rollover. You’ll also be required to complete a Bitcoin allocation order to provide documentation that you made the decision to include Bitcoin in your retirement plan.
Once you have succeeded in putting Bitcoin in the center stage of your retirement plan, the same rules that apply to traditional IRAs will also apply to your self-directed IRA. For instance, you won’t be allowed free access to withdraw funds from the IRA account until you are almost sixty years old. If you insist on withdrawing from the account, you’ll be penalized with a fee for early withdrawal.
Savers tend to lose money over time because of the weakening effect that inflation has on their investments. In fact, investors with an exposure to bonds, cash, and stock often observe that their wealth doesn’t keep up with inflation. However, Bitcoin offers impressive upward potential that counter balances the effects of inflation on an asset.
Retirement is one of the milestone events that require prior proper planning. Without prior proper planning, retirement can be a boring, penniless, and a dreary phase of one’s life. However, with adequate preparation, that includes Bitcoin in an IRA, you can look forward to retirement and hope to have a relaxed, worry-free, and exciting time enjoying the rewards of your working years.