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  • Dave Kinzer

Should You Invest In Bitcoin For Your 401(k)?

Cryptocurrencies are in the news again.

Fidelity Investments, the largest retirement plan provider in America, announced it will allow its investors to buy Bitcoin for 401(k) plans.

A lot of people buy Bitcoin on the side, but should you invest in Bitcoin for your 401(k) plan?

Before you decide, ask yourself why you are considering doing so. Is it because Bitcoin is more exciting and fun than investing steadily in “boring” companies like AT&T, Microsoft, and McDonald’s?

I consider stocks to be safer and more reliable. But they don’t have as great a potential to skyrocket quite like Bitcoin, right? Well, let’s do the math.

I plugged some numbers into the calculator at to see what $10,000 invested in those three companies would be worth today.

Ten thousand dollars invested in Microsoft in 2012 would be worth $109,073 today, good for an increase of 990%. The same amount invested in AT&T would be worth $14,315 (increase of 43%), and if invested in McDonald’s, it would be worth $34,687 today (increase of 246%).

Had you invested $10,000 in the entire S&P 500, your money would have grown into $36,766, good for an increase of 267%.

These are great returns! Nothing boring there. But let’s compare that to an investment in Bitcoin.

In May of 2012, a single Bitcoin could be purchased for around $5. At the time of this writing (May 8th), one Bitcoin costs $34,544.

So, according to the Bitcoin Return Calculator at, $10,000 invested in Bitcoin in May of 2012 would be worth over $71 million today.

Let that sink in for a minute. Or not. If you’re in a certain state of mind it can be kind of depressing, I suppose.

If you’re considering Bitcoin for your 401(k) because you’re expecting it to increase in price by almost seven hundred thousand percent again, it’s probably not going to happen.

“Fine,” you say. “When Fidelity offers more cryptos, I’ll just pick a different one for my 401(k) that hasn’t taken off yet.”

Okay. But which one?

According to, as of March 2022, there were 18,465 different cryptocurrencies. Choose a good one, but watch out for the ones that might fail. There are already 8,102 of these “dead” cryptos.

Another way to think of it: almost 44% of all cryptocurrencies have failed.

Some failed because they were frauds, like BitConnect and OneCoin, while others failed because people just stop trading them, like BoringCoin.

But don’t worry, if you can’t find a cryptocurrency you like for your 401(k), just create your own! If you don’t have the technological skills to do this, you can pay someone at to create it for you.

Fiverr has a lot of sellers offering to create a cryptocurrency just for you. One of their recommended sellers is offering three different levels of options. He will charge you either $395, $995, or $2980, depending on the options you select.

I don’t know about you, but the fact that just anyone can create their own cryptocurrency does not motivate me to buy any of them.

Do you really want to risk your retirement on a volatile type of money anyone can create, one that has a high rate of failure, one that isn’t backed by any assets, and one that is banned by China and seven other countries and severely limited by dozens of other countries?

Remember, this is your retirement money we’re talking about. You need this money to pay your bills for the rest of your life.

If you still want to, go ahead. It is, after all, your money.

I’d encourage you to limit your investment in Bitcoin and other cryptos to a very small portion of your 401(k), like three percent or less. Put the rest of your retirement money in stocks and bonds, two different types of assets with a proven track history.

No, they probably won’t skyrocket quite like Bitcoin did, but they have shown that over time, they always go up in value.

Bitcoin and other cryptocurrencies are too new to know what they will do over time. Why gamble with your retirement?

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