JOHANNESBURG - I am in no way a financial advisor. I do, however, understand the basics of diversified investments and one that people still ignore is the new market of cryptocurrencies. South Africans are notoriously bad at saving for their own future and planning for their kids financial future.
No matter how many times you do it, buying Christmas gifts for your kids can be daunting. Too little, too much, too small or too big – the possibilities (for disaster) are endless. This year, I’m suggesting you spend less on toys and things your kids will throw away and try a different kind of stocking filler: crypto for Christmas. Here’s why:
Bitcoin represents the best asset investment for the next decade.
Did you know that Bitcoin has been the best performing asset class in 2019? Financial planning for your children doesn’t have to begin and end with an unimaginative savings account with your bank. Thinking creatively about an investment portfolio is the best way to optimise return and Bitcoin has definitely demonstrated its staying power. Other popular coin options in South Africa are Ethereum and Ripple.
Financial literacy is a must-have skill for young South African adults
I cannot stress the importance of financial literacy enough. A solid understanding of how our financial system works is something that most of us only gain in our late twenties, if ever. Without it, navigating personal or business finances is tedious and difficult.
As a parent you hope to raise kids that are as money-savvy as possible and it all begins with a conversation about the world of money as it pertains not just to them but to their environment and careers. That conversation includes a key question: what will the world of money look like in 2030? Spoiler: It’s likely to involve a lot of crypto.
Digital currencies are set to disrupt the world as we know it
Children born in the last decade are set to come of age in a future we can barely imagine, nevermind plan for. Much like our parents couldn’t have predicted how deeply inventions like the internet and social media would impact every facet of our lives, so are blockchain and cryptocurrency cutting-edge technologies that hold the capacity to change absolutely everything about the world as we know it.
I believe that the best way to capitalise on change is to stay ahead of the curve. When Facebook ushered in a new era of advertising and content creation, only a handful of people were equipped with the skills to step up to the plate. Cryptocurrencies around the world are building work forces to engineer the future, and may well be the biggest digital employers in years to come. Familiarising your children with crypto and Bitcoin now will serve them well as we move into an uncertain digital future.
Help your kid to be an engaged, alert consumer
Right now Generation Z make up 32% of the world’s population. They spend 10 hours a day online – at least – and, in the US alone they hold $44 billion in spending power. It is Gen Z’s values and habits that will alter the world of money the most as they flex their consumer power.
Why? Because so much of what Gen Z spend money on is digital. Books. Apps. Games. Subscriptions.
How many times this year alone have you reached for your credit card to pay for something online? Cryptocurrency will be the flip side of the digital coin for Gen Z. Instead of credit cards and EFTs, they will look to Bitcoin and Facebook Pay as financial solutions. Understanding digital currencies will be mandatory to how they approach this bold new world.
We are on our way to replacing the current financial system with something faster, cheaper, and generally more useful. Cryptocurrency for Christmas may not be a gift wrapped in sentimentality, but it is a gift that will introduce your Gen Z-er to the potential and promise of Bitcoin. And if nothing else, there will be a decent cash out when they get around to their 18th birthdays.
Nic Haralambous is the CMO of Coindirect.