Cryptocurrencies like bitcoin and ether have shown impressive historical performance as an asset, beating the performance of gold, stocks, and real estate by a huge margin over a decade.
Next, estimate your potential post-retirement income including pensions, rental income, interests, and dividends. We’ll call this annual post-retirement income. Another critical insight is that crypto, and bitcoin in particular, outperformed most other assets by a huge margin. For instance, bitcoin outperformed gold. Bitcoin has an average annual return of 1,576% and a total return of 18,912% from 2010 to 2021 , while SPDR Gold Shares had an average return of 5% and a total return of 62%.
One thing to keep in mind is that the world’s major central banks have printed unprecedented amounts of money in the tens of trillions of dollars since the Global Financial Crisis in 2008. Core inflation in the U.S. averaged 4.48% per year between 2020 and 2023 for an inflation total of 14.04%. That means your 15% average annual return in the S&P 500 index would only be 10% after factoring in inflation.
When you plan your retirement, it’s critical to think about the fixed supply of bitcoin and ether’s decreasing supply. There are also other cryptocurrencies that have similar characteristics. Particularly, you need to consider inflation, your country’s monetary supply, and your local currency’s long-term stability.
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