In this inflationary economy, two questions that we are hearing frequently at Financial Harvest Wealth Advisors are: should cryptocurrency or gold be in my investment portfolio?
If you are like many investors and you want to gain better insights to help you make wise decisions regarding your investments and savings, you’ll be especially interested in Episode 6 of the Plant. Harvest. Prosper. podcast. Hosted by Kellen Williams, Wealth Advisor and CERTIFIED FINANCIAL PLANNER®, the timely topic of Episode 6 examines the role cryptocurrency or gold might play in your investment portfolio.
Less than 15 minutes long, this podcast is packed with insights and applicable and actionable steps you can take. Kellen explores the big questions surrounding the potential of gold or cryptocurrency to serve as a hedge against inflation.
Watch and Listen
What is Cryptocurrency? How Does it Function?
A cryptocurrency is a form of code stored in a digital wallet. Cryptocurrency is designed to be used over the internet but can be used in other ways. Essentially crypto makes it possible for you to transfer money online without the need for a “middleman” like a bank or a processor such as PayPal. Bitcoin is the cryptocurrency with which most people are familiar, but there are thousands of other currencies.
“In recent years there has been a bit of a gold rush mentality with those who dove into cryptocurrency early reaping rewards but those who came to Bitcoin and other cryptocurrencies late earning less or maybe even losing money.”
Blockchain is the logic behind crypto. Blockchain is basically a ledger of crypto transactions, with each currency having its own ledger.
Kellen explores the similarities and differences between cryptocurrencies and pyramid schemes and cryptocurrencies and NFT or non-fungible tokens. Among the questions he delves into are:
- What is the underlying asset tied to crypto? (Hint: there’s not one).
- Is cryptocurrency regulated or protected? Will it be an international form of currency in the future?
- What challenges the standardized use of cryptocurrency?
- What is the impact of cryptocurrency mining on the environment?
- He also looks at other concerns including the cost of transactions, competition among forms of currencies, and the good and bad of volatility.
Is Gold a Hedge Against Inflation?
Gold is a historic commodity. At one time gold was tied directly to the value of the U.S. dollar, a correlation known as the gold standard. In 1971, President Richard Nixon did away with the gold standard, which means that since that time gold has no longer been tied to the value of an asset.
Is gold truly a good hedge against inflation? Kellen helps you make this decision as he shares what has happened to the value of gold between 1980 and 2006, and how well or poorly it has kept pace with inflation.
Making Wise Money Decisions
You could rightfully say that Episode 6 is a “goldmine “of information. You’ll want to find a few minutes to hear all that Kellen explains. And you’ll no doubt be interested in his guidance as he elaborates on how investors can:
- Plant: Asking what is the role of this investment? What is the growth potential? What is the cost?
- Harvest: Assessing all your savings to see if you are on track for achieving your goals
- Prosper: And finally defining your expectations on the volatility of any new investment.
As always, our purpose is to help you, our listeners, make wise decisions with your money. We encourage you to live purposely toward prosperity. And we challenge you to reach your own understanding of what living a good life looks like to you and then determine how you can use your wealth to achieve your good life.
How to Listen to or Watch Plant. Harvest. Prosper. Podcast
You can view the video of each monthly episode, here on the Financial Harvest website. Just mouse over the “News” tab in the navigation bar and then click “Plant. Harvest. Prosper. Podcast.”
Or you can listen on the go, with the audio-only version of the podcast available on all the most popular podcast platforms including iHeartRadio, Spotify, Apple Podcasts, Google Podcasts, Stitcher, and others.
Interested in a deeper dive into understanding cryptocurrency? Read: What is Bitcoin? Understanding Cryptocurrency
