Welcome back to another Q&A with BoldTV host Philip Michael. Philip talks about crypto and the probable benefits of long-term investing. Check it out!
Q. Can I invest in Bitcoin? Or can you suggest anything to invest in?
A. The short answer is yes, you can invest in Bitcoin. You can buy it on Robinhood and other trading platforms right now; it’s freely available to you.
In terms of suggestions, I understand that Bitcoin is very hot at the moment. Many people are saying that Bitcoin will blow up, and many people will become rich from it. However, You never want to go into investments thinking that you’re going to get rich quickly. You want to get into something that you believe in for long-term investing. You can similarly equate money to wealth and health. You don’t go into the gym and become a bodybuilder overnight. It just doesn’t happen. Just let it take its course. I’m not saying that Bitcoin isn’t a viable investment for the future. The jury’s still out on that.
Q. Any legit Bitcoin or crypto investments you know?
A. Bitcoin is just one of many cryptocurrencies. There are others like Dogecoin, Ethereum, Ripple and many more. So, I understand where you’re coming from when you ask, “any legit Bitcoin investments.”
These cryptocurrencies can be looked at as a digital version of gold, where you can store value and be able to one day make everyday transactions. However, even if you don’t believe this will happen, there still might be something of value there. Similar to gold, there are other less precious metals that you could have, like silver. So, you could see the silver and bronze equivalents of Bitcoin emerge, which will be other cryptocurrencies.
Which of these currencies will emerge as the silver and bronze standard of crypto? It’s hard to say. It could be Ethereum, or it could be another cryptocurrency. The jury’s still out on that. You also have stuff like NFTs now, so it’s definitely something to watch. But in terms of other cryptos, I’d be mindful and do a lot of research. You really have to take a leap of faith because no one really knows what’s going to happen.
Q. I have two kids I want to build a financial future for. If I have 20k a year to invest, what would you advise?
A. Alright! 20K a year – think about this. Over the last 140 years, the stock market has gone up by between nine and 10% every year. No matter what happens in between – depression, recessions, and other financial crises – the stock market averages those numbers. So if you can stay calm when these things happen, and they will, over time, you’re going to win. I think that’s probably the best way you can do it passively. Stay away from the people who get upset and the people that get all hyped up. When they start selling, keep it there and continue with long-term investing.
There’s this strategy called dollar-cost averaging. If you do this over a 10 year period, starting from 20,000, becoming a millionaire isn’t a maybe. It’s not even a probability. It becomes an inevitability.
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For another Ask Philip, check this out.