Crypto is all the rage these days. Which ones are you buying?
Here’s the most important question: WHY are you buying it?
Your reasons for buying can play a key role in your investment strategy and what you do going forward.
Here are my thoughts on buying crypto and top strategies for cryptocurrency profits:
Some people are buying crypto because they are looking to make a quick profit. Others are buying it because it they are trying to get out of the current monetary system.
Another question to ask yourself is “what will you do with your crypto profits?” Nothing wrong with buying and holding your crypto, but having a solid plan for your bitcoin or dogecoin is essential too.
Chess or Checkers?
For savvy investors, the key to investing success is to look ahead and have a strategy:
- If the market goes up, what will you do?
- If the market crashes what will you do?
- Are there other investments that grab your attention?
- If the stock market crashes what’s your strategy?
- If inflation hits record highs how will you protect yourself?
- If you sell your investment what will you do with the proceeds?
By answering these and other important questions before the event occurs, you will be better equipped to deal with them as they arise. In other words, invest like an expert chess player and look 3-4 moves ahead.
Crypto investors should consider shifting some of those profits from crypto into other assets. Not all, just a portion. These assets should either hold onto their value, generate revenue, or both. Diversification in various asset classes is the key to preserving wealth and increasing its value as well.
While many think crypto will be around forever and take over the world, that’s not a guarantee. There are several instances of cryptocurrencies getting pushback from high places:
- Turkey’s central bank recently prohibited the use of crypto in commerce, citing the danger of “irreparable” damage and transactional risk.
- In September, China’s central bank has declared all transactions involving Bitcoin and other virtual currencies illegal, stepping up a campaign to block use of unofficial digital money.
The United States is watching crypto closely as well:
Janet Yellen says ‘misuse’ of cryptocurrencies like bitcoin is a growing problem as regulators tighten scrutiny after surge in interest.Read the story HERE.
What’s Your Investment Strategy?
There are many investment strategies out there, but one that should be looked into is one that wealthy individuals practice, which is The 1/3 Investment Strategy:
- 1/3 real estate (rental property)
- 1/3 precious metals (gold and silver)
- 1/3 fine art (rare paintings)
With this strategy, money is invested in assets that are used to hedge against inflation. This is a prime example of wealth preservation. Monies made from crypto could be spread among these 3 assets.
Another option is to start a business that can generate revenue. With a business that sells goods or services, prices can be increased to keep up with inflation.
The average millionaire has 7 streams of income. Not 7 jobs, but seven forms of income. Most of these investments are passive income, This would be an excellent way to use some of the proceeds from your crypto profits. Ask yourself: “if you can’t work, how would you earn money?”
This is playing chess while others are playing checkers. Now is the time to start thinking about these things while you can do something about them.
Call To Action
We are in some exciting times. Will cryptocurrencies continue their meteoric rise? Time will tell. Whether you decide to invest in stocks or crypto, you must have an investment strategy. Things could change in an instant and you as a savvy investor must be prepared for anything that can happen. This means paying close attention to current events, the stock market, the FED and economy. No one can tell you what to do or tell you what the best investment strategy is. This is an individual decision based on individual risk tolerances and preferences.
With that said there are many investment strategies out there you can study and learn from. This knowledge is key for financial literacy.
Don’t wait until events happen to figure out your next move, start preparing now. Register for my online class at the Yes We Did Virtual Learning Center: Tired of the 9-5? How To Retire Early With Passive Income.
It’s important for children to know they have options as well. Order a copy of my book Planting Seeds: The Children’s Guide To Entrepreneurship. Available in English, Spanish, and French on Amazon.