Parents Turn to Crypto To Save for College
A growing number of parents are now using cryptoassets as a way to save for their child’s future college education.
According to a report by CNBC, 87% of parents who are saving for their children’s future college expenses have invested in cryptoassets. The report cites a recent poll of 1,250 parents by the online magazine Intelligent.com
The report outlines a number of ways parents can invest in crypto for college savings without “gambling away” their child’s future. In particular, the report tells parents to use crypto in moderation and to proceed with caution when adding digital assets to their savings strategy.
Ric Edelman, a financial advisor and founder of the Digital Assets Council of Financial Professionals, told CNBC:
“You don’t want to gamble your child’s ability to go to college on a speculative bet.“
Edelman recommends that investors should include crypto as part of their diversified portfolio with an allocation of 1-5%. He warned that parents should have limited exposure and not make crypto the majority of their investment strategy.
Ben Weiss, CEO and co-founder of CoinFlip, said that parents should be mindful of their student’s time horizon when creating a college savings plan. He advised against parents investing in crypto if their child will be beginning college in the short-term. However, he said parents with longer time horizons such as a decade or more could be “more aggressive” with their crypto investment strategy.
The report also warned parents about the tax implications of investing in crypto, saying they could wind up owing a “large tax liability” when they finally cash out.
Featured Image by Pexels via Pixabay
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