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August 2021   Volume 19, Number 8        

This Just In ...

Cryptocurrency: A New 401(k) Option

Should Ethereum, Bitcoin, Dogecoin and other cryptocurrencies be a part of a sound retirement plan?

It’s not as farfetched as you might think. This summer, one company started to allow some employers to offer cryptocurrency as a 401k investment option.

Investors exchange money for cryptocurrency, which can be used like a token to purchase goods or services. Cryptocurrencies generate no cash flow, so the value of cryptocurrency only increases if someone pays more than the investor before them. There currently are more than 10,000 different cryptocurrencies traded publicly.

ForUsAll, a retirement investment platform for small businesses, introduced the Alt 401(k). The 401(k) is offered through Coinbase Institutional, an arm of Coinbase Global Inc., a leading cryptocurrency exchange. Employees can invest up to 5 percent of their 401(k) contributions in bitcoin, Ether, Litecoin and others.

The advantages to having cryptocurrency as part of a 401(k) are:

  • Gains are tax-deferred — or tax free if invested in a Roth IRA
  • Investments are diversified
  • Potential for great returns
  • They could entice employees who were hesitant to save.

The downside is that it’s risky. For instance, the value of all cryptocurrencies in May 2021 was more than $1.7 trillion — down from $2.2 trillion in April.

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In this issue:

Cryptocurrency: A New 401(k) Option

How to Help Employees Set Up an Emergency Cash Reserve

Best Practices for Administering Intermittent FMLA Leave

Are You Responsible for Employee Identity Theft?

Why Do Health Care Premiums Increase?



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