The retirement strategies of millennials and Gen Z’s are not your grandmother’s retirement plan. Millennial and Gen Z investors say that crypto is part of their retirement portfolio, a recent survey found.
According to a survey by IRA rollover service Capitalize, 56 percent of Gen Z adults (18+) and 54 percent of millennials say they are including cryptocurrency or NFTs as part of their retirement plans. Only 20 percent of Gen X and 14 percent of baby boomers surveyed said they are investing in crypto to save for retirement. They are going for bitcoin and ether.
Capitalize gathered respondents through the Amazon Mechanical Turk survey platform, and that their answers were “self-reported and are subject to issues, such as exaggeration, recency bias, and telescoping.”
A different survey, this one done by market research firm Pipslay conducted in May 2021, found that while millennials are leading in crypto investing, with 49 percent of millennials owning cryptocurrency, Gen Z isn’t as eager to buy crypto. This survey found that only 13 percent of Gen Z own cryptocurrencies.
“Millennials are growing natively with Web 2.0 — that is, mobile — and Web 3.0 (crypto) technology,” Kurt Kumar of Rocketfuel Blockchain, a crypto payment processing company, told Yahoo. “They intuitively understand digital wallets and treasure chests, which are part of many games younger millennials played, such as Fortnite and Minecraft.”
Millennials have long been comfortable with investing in crypto; 46 percent percent of them believe they can become millionaires by investing in cryptocurrencies, according to a survey by the research company Engine Insights.
With cryptocurrency still being so volatile, how wise is it to have it as part of your retirement portfolio?
Some personal finance experts advise you not to devote more than 5 percent of your net worth to high-risk investments like digital currency, Money reported.
In any case, cryptocurrency is making people of all ages rethink their retirement investments.
But if you do invest in crypto as part of your retirement, proceed with caution, say experts.
“If you’re interested in investing in cryptocurrency to supplement your retirement savings, you can open an account with a crypto exchange or traditional broker that offers cryptocurrencies and put a portion of your budget toward your crypto investments,” reported Experian. “Make sure it’s a small portion of your total investment strategy, though. Again, while crypto does have a high potential for short-term gains, it also has a high risk of big losses. And in the long run, the jury is still out on its reliability as an investment vehicle.”