Cybersecurity Implementation for Cryptocurrency Retirement Plans

Saving up for retirement is something everyone must face at some point in their lives. Thankfully, technological advances in the 401(k) industry now help customers with recordkeeping, investment opportunities, automated features, and more. 

Retirement seems a little less scary with the help of new tech. Some people are exploring the potential of contributing cryptocurrency investments to their retirement plans. 

However, it’s commonly understood that retirement plans are often seen as major targets for cyberattacks. If someone were to save up for retirement using crypto, are there certain measures they should take to fend off attacks?

Should You Include Cryptocurrency in Your Retirement Plan?

Despite some financial experts deeming the world of cryptocurrency a scam, it’s gained widespread adoption around the world. In the last few years, the price of Bitcoin has skyrocketed and officially passed $20,000 in 2020.

Due to this exponential growth, it’s no surprise that people are starting to think about incorporating crypto into their retirement plans. Several experts believe crypto investments can add value to your retirement plan, as long as it’s well-balanced with other traditional assets.

This month, Coinbase and ForUsAll, a 401(k) provider, announced that they would allow Coinbase employees to invest up to 5% of their 401(k) contributions in the form of crypto, whether its ether, bitcoin, litecoin, or others.

Because retirement plans store such valuable assets, they pose a risk to the user in terms of cybersecurity. These plans also store a ton of personal information that a hacker may want to get their hands on. Some prevalent cybersecurity threats include monetary theft, loan fraud, identity theft, rollover check interception, malware, and ransomware.

4 Cybersecurity Tips for a Cryptocurrency Retirement Plan

If you decide to incorporate crypto into your retirement plan, there are some cybersecurity measures you should take to protect yourself and your valuable assets. 

1. Investigate Bitcoin IRA Companies

Because the nature of cryptocurrency lends itself to anonymity, it’s common for malicious actors to set up scams with the goal of convincing unsuspecting crypto investors to hand over their assets. If you decide to invest with a Bitcoin IRA company, be sure to do your due diligence and research the platform thoroughly. 

Avoid falling for any fake marketing schemes and look into any potential platforms you’ll use for your crypto retirement plan. You should feel confident that your money is safe and protected for future use.

2. Store Crypto in an Offline or Hardware Wallet

One of the best ways to keep crypto protected is to store it in an offline or physical wallet. Digital wallets are often used by crypto enthusiasts, but they’re not impervious to hacks. The safest option is to store your crypto in a hardware wallet so only you have access to the private keys.

3. Be Aware of Malware and Ransomware Attacks

Cases of malware and ransomware are running rampant and show no signs of slowing down. As digital technologies become more advanced and prevalent, hackers work harder and become more sophisticated with their attacks. If you’re aware of potential threats, you can take certain precautions when browsing online or reviewing your digital retirement plan. 

Here are some basic steps you can take to protect yourself:

• Backup data regularly
• Update your operating system (OS) and software frequently
• Maintain updated anti-virus software
• Avoid clicking on suspicious, spammy links
• Never turn over any login credentials or personal information to unauthorized users

It’s also a good idea to consider consulting with a financial advisor, specifically one who is well-versed in retirement planning. They can offer you helpful advice to keep your crypto secure.

Protecting Your Crypto Retirement Funds

Because crypto has caught on, more people may consider investing in it and adding it to their retirement plan. If you’re new to investing, be sure to educate yourself first and avoid investing too much of your hard-earned money. It’s always worth speaking to a financial advisor or cryptocurrency expert to determine if crypto investments are right for you.