The need to invest becomes more apparent as we grow older, and seniors have developed a habit of cashing out their investments more than younger consumers despite being advised to move them from stocks to bonds. The high inflation has presented a threat to their habits, forcing some to seek alternative assets, including cryptocurrencies.
Last year saw Bitcoin rise 164%, an incredible number compared to other assets. The big numbers make crypto assets seem like an attractive prospect for pension funds and seniors. However, it has also raised questions among them, including how to avoid financial exploitation from family numbers.
The demand for a Bitcoin option from retirement plan sponsors prompted Fidelity Investments to offer it as an option in 401k plans. The company offers the program to employees at Microstrategy before broadening it to other industries, but employers will need to approve it to allow employees access.
Other companies argued against the option, saying it would be a breach of fiduciary duty for financial advisors to not offer advice on digital currencies. As a result, retirement fund managers have catered more towards the younger workforce.
It remains to be observed if the trend will continue depending on whether it gets regulated or not. Older investors are likely to turn away if they get burned by crypto or if the economic outlook improves.
Justin Castelli, a certified financial planner and crypto educator has lent his expertise to seniors, retirees, and pre-retirees, taking up 70% of his clientele. He helps them stay ahead of the string of misinformation running rampant online. Castelli is not alone as more companies have started educating financial advisors on crypto. Due to the amount of false information regarding crypto investing, the crypto educator has made it his mission to help clients understand the basics.
Presbyterian Senior Services, a nonprofit based in New York, added a new course called: “Introduction to Cryptocurrency.” The course was designed to answer questions curious onlookers had. The webinar attracted a few dozen online viewers and was streamed on large screens at PSS centers.
Andy Phillips, a PSS advisor who put the seminar together, said he designed the course as a kind of inoculation to help older adults build a resilience toward get-rich-quick schemes. For the seminar, Phillips brought in “Doc” Severson of ReadySetCrypto to share his experience without overselling to the audience. The decision paid off as people showed an interest in additional educational sessions on crypto.