Just as it’s never too late to start investing, it’s also never too early to start investing. When you’re young and your life is just starting out, there is still plenty of time to save up for your retirement. As a bonus, your investments can already pose as your retirement fund. With Bitcoin budding as the currency of the future, you should consider investing in it, especially while you are young.
What is Bitcoin?
If you aren’t familiar yet, Bitcoin is a type of cryptocurrency that is virtual or digital in nature, thus it bears no physical form. Moreover, it is independent of any kind of intervention and regulation from any financial and governmental institution.
All transactions are also recorded in a ledger called blockchain, which is available for public viewing. Having only been released in 2009, Bitcoin’s value already rose to as much as $9,500 for every Bitcoin. Imagine if you got into this earlier—getting 1 Bitcoin before for $1 would now have amounted to $9,500.
Now, here are more reasons why you should invest in Bitcoin while you are young:
1. Advantage of Time
At a very young age, the biggest advantage you have over others is that of time and having it by your side. Time is something that you can never take back. As mentioned above, if you bought 1 Bitcoin in 2009, you would have been roughly $9,500 richer by now.
It’s very practical to invest while you are young because of the time factor. One reason is because you have time for long-term investments to grow. Long-term investments are all about compounding interest using the advantage of time.
So, investing at a young age gives you a very big advantage. It’s very crucial to invest early to take advantage of compound interest. Moreover, in order to preserve the value of your money and protect it against inflation, you must invest it. For Bitcoin, you may invest by buying or trading it in various platforms online, such as the Bitcoin Rush platform.
2. Currency of the Future
Bitcoin addresses many issues that fiat money or foreign currency is currently facing. This is why Bitcoin is thought of as the currency of the future. Being decentralized, Bitcoin solves the problem of foreign currency values being regulated and controlled by the government. Moreover, with blockchain technology, everyone will also be able to see all transactions going on with Bitcoin, which lessens the risk of hacking. With that in mind, it’s better to get into Bitcoin as soon as possible.
3. Portfolio Diversification
Even at a young age, if you are investing, it’s best that you don’t put all your apples in one basket. You’d want to diversify your portfolio when you are investing, no matter if you’re young or old. If you belong to the former demographic, Bitcoin might be the best way you can diversify your portfolio.
Again, because Bitcoin is not regulated by the government or any financial institution, Bitcoin is independent of the movements happening in the economic and political sphere. This means that if a recession occurs, Bitcoin won’t be affected because it is not a currency of a particular country. Bitcoin doesn’t follow anything other than market sentiment. It moves in its own way, so you are assured that it won’t be affected by random news regarding the country. It will only be affected by news regarding Bitcoin specifically.
When you are young and investing for your retirement fund, liquidity can be a problem for you. Luckily, right now, that isn’t a problem with Bitcoin as more and more retail establishments are starting to accept Bitcoin as an official form of payment. Judging by the historical performance of Bitcoin, there will likely be even more establishments that will accept Bitcoin as a form of payment.
This is why you won’t have a problem liquidating your Bitcoin assets because you can use it to buy so many things. Even some schools accept Bitcoin as payment for tuition. There are also some airlines that accept Bitcoin as payment for flight tickets as well.
In addition to that, it is more convenient to transfer Bitcoin from one country to another as there are less transaction fees compared to foreign currency. So, if you need to transfer your money, Bitcoin will cost you less, not to mention the process is faster compared to foreign currency.
5. Ability to Take on More Risk
You know what they say: “The higher the risk, the higher the profit.” The same is true for Bitcoin. However, when you are young, you can withstand higher risks. This is because being young generally means you have lesser responsibilities and duties as compared to someone who’s older and probably has a family. This means that you can take on higher risks. However, one thing you have to know before investing in Bitcoin is that the risks are higher.
With Bitcoin, you can build a more aggressive portfolio to produce more profit that will reach your target retirement fund.
Being a virtual currency, investing in Bitcoin can be a bit heavy on technology. Since the younger generation is more tech-savvy, it’ll be easier for them to navigate the online trading platforms, investing tools, and technical analysis for Bitcoin. With Bitcoin, there are no physical bills, and your wallet is also a virtual wallet. Of course, once you lose access to it, you’ll lose your money as well.
When it comes to Bitcoin, it’s best, therefore, to be well-versed and comfortable using technology. This is why younger people have an upperhand in this type of investment compared to older ones because the former understands technology the most, making it easier for younger people to learn about Bitcoin.
Investing can be a bit scary, especially if you only have little knowledge about it. The key is to research more about Bitcoin before venturing into an investment. Having time on your side, you will reap profits after a few years with very minimal effort. With the upward trajectory of Bitcoin, start investing now and you will never regret it.