Yesterday I wrote a post about planning to set up my own retirement fund in crypto.
Today I'd like to explain what's wrong with the existing system and then I'll let you know what's the fist step I did to secure some funds.
The Obsolete System
At the time of writing, contribution to the retirement fund is mandatory in my country, if you're an employee or a business owner. There's a certain percentage you have to pay each month and if you neglect payment, there are penalties.
You have to contribute at least for 18 years, in order to get a pension. There's an age limit after which you can ask for a pension, it's 63 for women and 65 for men. There are special circumstances, when you can ask for pension earlier, but that's not important at this point.
What's important is that your contribution goes to the government's budget and you have no control over it. You can't get it back ever. When you retire, you're paid a monthly amount, which depends on how much the law says. The amount is calculated based on possibilities and has nothing to do with the value of contribution over the years.
If you die before you can retire, you get nothing as those funds are not yours anymore, your family is not entitled to get the benefits either. If you live a few months after you retire, you get a few payments and that's it. The government is happy for saving money. Your contribution is not invested, so storing value is out of the question.
Maybe I'm the problem here, but I fail to see the benefits of such system.
This is why I'm working on setting up my own retirement funds in crypto. Yesterday I wrote a post about it and today I made the first step.
The First Step
My plan is to secure some BTC and ETH every month. This means getting these funds to a safe place and keep it there till the time comes. Crypto is for long term anyway.
The first option would be to transfer it to my cold storage, but I have to consider the fees as well, so for now I have chosen a different plan.
Since this is a long term plan, I decided to lock some stake on Binance and earn more. There's a Locked Staking option, with 30, 60, 90 days options. The APY is not a lot, but compared to interest paid by banks it is indeed a lot. Plus keeping it in a cold storage brings you nothing, not to mention the transfer fee. Which one is safer? Well, it depends, both can be safe and risky as well, depends on how safe you can keep your password and seed.
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After the locking period is over or way before that, I'm going to consider my next step. My ultimate goal is to keep my crypto on my cold wallet, but first I need to accumulate enough to be worth paying the transfer fee. Every penny counts.
This is just the beginning, I'm sure in time I will find the best system.
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That's good to know. I never explored the staking options on Binance but I guess it's something to consider.
I have also been adding a little BTC and ETH every now and then but they are just sitting there so it could be worth to stake it.
ANother thing I also considered is putting some of it in the dens in CubFinance. Do you have an opinion on that?
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That is also a good option but you need to consider the costs. Moving BTC and ETH out of binance costs a lot and if you have very little, it may not worth it.
It depends on the case.
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Nice article
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I know what you mean about the Fees!
Ideally you want to be moving a minimum of $500 of each, I think holding and staking on the exchange is a decent option, although you can get both BSC and ETH onto BSC and stake in Cub Dens for example for quite cheap.
What I've started doing is using BSC to accumulate more ETH and BSC too, and adding more to my dens on Cub, it's all cheap, eventually I might move some out to cold storage.
I've got most of my BTC in cold.
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I also have a part on my trezor.
BSC is also a good option if you have enough to be worth moving it out of the exchanges. All options must be considered.
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With BSC I don't mind moving around very small amounts, but I still aim for a minimum of $50 when it comes to transfers, and then I keep an eye on which token I'm transferring, the prices can vary!
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$50 is not a problem.
I haven't had time to follow the latest developments. Do you know if they are planning to add more kingdom options?
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Lol really? What type of penalties?
Nice plans, though I don’t see myself putting so much long term trust on a centralized exchange , but it’s just me though, Binance has earned its trust and safeguarding ability
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No worries, leofinance is as centralised as binance.
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Yeah but Khal lives on my street, CZ is a bot 🤖 and lives in space lol just joking
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I am retired in the same country where you live. I know something about retirement and it seems like you don't know them.
First of all, you can invest in pension funds that are not administered by the state, they invest the money and multiply it. When you reach retirement age, you can choose to receive all the money accumulated in a single installment or to receive it monthly. If you die before retirement age this money is given to the heirs. It seems to me a fairly modern system.
It's just that you don't believe in fiat money and banks. Then crypto remains the solution (but why not precious metals, gold, silver ...).
I'm not accustomed to this crypto volatility. I think that after a certain age it is quite common to have different diseases, heart or brain. A drastic and rapid decline in the crypto pension fund could have serious effects on the heart.
I mean, every system has advantages and risks. It remains our choice ...
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