The Next Big Thing: What's Outpacing Bitcoin?

Bitcoin has been one of the best investments in the world since its creation in 2009, but its extreme volatility has made it a risky investment. While Bitcoin is still the most popular cryptocurrency, with a market cap of over $360 billion, there are several other cryptocurrencies that have been raising faster than Bitcoin. These include Ethereum, Ripple, Litecoin, Cardano, Binance Coin, Polkadot, Solana, and Avalanche.

Ethereum is the second most popular form of cryptocurrency and is currently valued at $1,641.82. Its network operates through smart contracts written in computer code that is uploaded to the blockchain, which other cryptocurrencies operate through.

Ripple is a money transfer and currency exchange network that processes transactions globally, and it doesn't need to be mined like most other cryptocurrencies.

Litecoin is often considered a sibling of Bitcoin as they work in the same way, but Litecoin has a faster speed of transactions.

Cardano is a proof-of-stake blockchain platform that was introduced as an Ethereum killer and a valuable alternative to Bitcoin.

Binance Coin is the medium of exchange for the Binance cryptocurrency exchange and is currently valued at $316.82.

Polkadot is a protocol that connects different blockchains and has a current price of $6.32.

Solana is a public and open-source blockchain that is both a form of cryptocurrency and a platform for running decentralized applications.

Avalanche is a decentralized, open-source, proof-of-stake blockchain with smart contract functions and its own coin, AVAX.

While Bitcoin continues to be the most dominant cryptocurrency, these alternatives have been gaining traction and raising faster than Bitcoin, making them attractive options for investors looking to diversify their crypto portfolios.

Investing in a 401(k)

A 401(k) is a retirement investment account offered by your employer. It is a "tax-advantaged" investment account, meaning that the money you contribute to it each year, typically a percentage of each paycheck, lowers your taxable income. This tax break is designed to encourage you to save for retirement.

There are two types of 401(k) accounts: the traditional 401(k) and the Roth 401(k). The former is the more common option, while the latter is offered by fewer employers. With a traditional 401(k), you contribute pre-tax money, and then pay taxes on the withdrawals in retirement. With a Roth 401(k), you contribute money that has already been taxed, and then you can make tax-free withdrawals in retirement.

If you are unsure about how to invest through your 401(k), here are some tips to get you started:

• Understand what a 401(k) is: Make sure you know how a 401(k) works, as this will help you save and invest effectively.
• Determine how much you can contribute: Financial experts advise contributing as much as you can, ideally between 10% to 15% of your income, especially when you are young. Many companies offer to match employee contributions up to a certain dollar amount or percentage.
• Calculate your risk tolerance: Determine your asset allocation, or how much of your investments will be in stocks (also known as equities) and how much will be in safer investments, like bonds. Stocks offer the potential for greater returns but can be more volatile, while bonds are more stable but offer lower returns over time.
• Pick your investments: You will need to choose investments for your 401(k) contributions, otherwise, your money will remain as cash. You can invest in mutual funds or exchange-traded funds (ETFs), which are baskets of securities such as equities. You cannot usually invest in individual companies through a 401(k).
• Go with the simplest option: Alternatively, you can opt for a target-date fund, which takes the guesswork out of investing. You select a "target" retirement year and risk tolerance, and the fund automatically adjusts its asset allocation over time.
• Scale up contributions over time: Once you've picked your investments, leave your account alone and let the contributions build. Experts advise increasing your contributions each time you get a raise or bonus.

Remember, investing in a 401(k) is a long-term strategy, and it is important to do your research and understand the risks involved.

Growing a savings account

While cryptocurrencies like Bitcoin have been all the rage, they are extremely volatile and not recommended over other forms of investments like stocks and bonds. If you are looking to grow your savings, there are several options to consider. Here are some instructive and focused tips on growing your savings account:

Determine your goals and set deadlines

The first step to growing your savings is to identify your short-term and long-term financial goals. Are you saving for an emergency fund, a vacation, a new car, or a down payment on a house? Setting clear goals and deadlines will help you stay focused and motivated.

Calculate how much you can save

Once you know your financial goals, it's time to crunch the numbers. Compare your monthly expenses against your income to determine how much you can realistically save each month. Consider using the 50/30/20 budget rule, where 50% of your income goes to needs, 30% to wants, and 20% to savings and debt repayment.

Prioritize your goals

Instead of spreading your savings evenly across all your goals, prioritize the most important ones. Choose a mix of short-term, medium-term, and long-term goals to focus on. This approach will help you make steady progress while staying motivated.

Choose the right savings vehicles

Different savings vehicles offer varying levels of liquidity, risk, and returns. For short-term goals and emergency funds, consider high-yield savings accounts, money market accounts, or certificates of deposit (CDs). For long-term goals, tax-advantaged accounts like 401(k)s, Individual Retirement Accounts (IRAs), or 529 plans may be more suitable as they offer tax incentives.

Automate your savings

Make saving easier by setting up automatic transfers from your checking account to your savings accounts. This way, you can save towards your goals without having to remember to transfer funds manually.

Explore investment options

To grow your savings faster, consider investing your money. Options include mutual funds, stocks, bonds, or other investment vehicles. However, investing comes with higher risks, so be sure to do your research and consult with a financial professional before committing your funds.

Remember, growing your savings takes time and discipline. By setting clear goals, prioritizing, choosing the right savings vehicles, and exploring investment options, you can work towards achieving your financial dreams.

Paying off high-interest debt

While cryptocurrencies like Bitcoin continue to pique investors' interest, it is important to remember that they are highly volatile and that there are other investment options that may be wiser. One such option is to focus on paying off high-interest debt, such as credit card debt, which often carries high interest rates – as much as 18% or more.

Ask for a Lower Interest Rate

Creditors may be willing to lower interest rates, especially if you have a history of making on-time payments. If you are usually reliable in making payments, call your credit card company and ask if they can offer a better rate. You can also use offers from other credit cards with lower rates as a bargaining chip.

Transfer the Balance to a Low-Interest Rate Credit Card

If you have good credit, you may qualify for a balance transfer to a low-interest or 0% APR (annual percentage rate) credit card. This will allow you to move your debt from a high-interest card to one with a lower or no-interest rate for an introductory period. Just be sure to read the fine print and understand how long the low or no-interest rate will last.

Pay More Than the Minimum Amount Due

Paying only the minimum required payment will typically keep you in debt for longer. To get rid of debt faster, pay more than the minimum. This will help reduce your principal balance, and you will be charged interest on a lower amount.

Lower Your Expenses

Look for ways to save money by reducing your expenses. For example, you could switch to a cheaper cellphone plan, cut back on streaming subscriptions or entertainment, or reduce your grocery bill by eating out less and cooking more meals at home. Any money you save can go directly towards paying off your debt.

Increase Your Income

In addition to reducing expenses, you can also boost your income to put more money towards debt repayment. This could include asking for a raise at your current job, taking on a side hustle or freelance work, selling items you no longer need, or renting out your extra space or car.

Pay Off the Card with the Highest Interest Rate First

If you have debt across multiple credit cards, focus on paying off the one with the highest interest rate first. This is known as the "avalanche method" of debt repayment. By tackling the highest-interest debt first, you will save more money in the long run, as the balance on this card will grow the fastest due to interest charges.

Get Credit Counseling

Consider seeking help from a certified credit counselor at a nonprofit credit counseling agency. They can assess your debt and provide guidance on the best repayment strategies for your situation. They may also be able to help you enroll in a debt management plan (DMP), where creditors lower your interest rate and monthly payment to make repayment more manageable.

Remember, paying off high-interest debt is often a better investment than chasing risky assets like cryptocurrencies. By eliminating high-interest debt, you can improve your financial stability, save more money, and make progress towards your financial goals.

Investing in yourself

Invest in your finances

• Start a retirement fund: The sooner you start saving, the more money you will accumulate over time. Consider contributing to a 401(k) or 403(b) plan, or opening an IRA or Roth IRA account.
• Set financial goals: Create short-term and long-term financial goals, such as saving for a vacation or paying off student loans.
• Save for a rainy day: Build an emergency fund to cover unexpected expenses.
• Grow your savings: Put your money in a high-yield savings account, money market account, or certificate of deposit to earn interest.

Invest in your health

• Nourish your body: Eat more fruits and vegetables, drink plenty of water, and cut back on processed foods and sugar.
• Exercise regularly: Aim for 30 minutes of physical activity each day, such as walking or running.
• Get enough sleep: Prioritize getting 7-9 hours of sleep each night to maintain your health and well-being.
• Practice self-care: Make time for activities that help you relax and recharge, such as spending time with loved ones or journaling.

Invest in your career

• Education and skills: Consider pursuing a degree, trade school, or apprenticeship to boost your career prospects. Stay up-to-date with the latest skills and trends in your field.
• Networking: Expand your professional network by attending industry events, joining online communities, or reaching out to mentors or connections.
• Side gigs: Explore passion projects or freelance work to gain new experiences and build your personal brand.
• Work-life balance: Set boundaries and make time for yourself outside of work to prevent burnout.

Invest in your relationships

• Spend time with family and friends: Prioritize the people who matter to you and make an effort to stay connected.
• Make room for romance: Cultivate your romantic relationships and plan special dates or activities.

Other ways to invest in yourself

• Learn something new: Embrace lifelong learning and seek out new knowledge or skills, whether through online courses, books, or other resources.
• Break bad habits: Identify and work on breaking negative habits that impact your financial, mental, or physical well-being.
• Get organized: Create an effective organizational system for your finances, paperwork, and personal space to reduce stress and improve productivity.
• Set boundaries: Learn to say "no" to things that do not align with your values or goals, and protect your time and energy.

Investing in other cryptocurrencies

Do Your Research

Before investing in any cryptocurrency, it's important to do your research and understand the risks involved. Cryptocurrencies are extremely volatile, and their value can fluctuate drastically. Make sure you understand the technology behind the cryptocurrency, the problem it aims to solve, and the team behind its development.

Understand the Differences

All cryptocurrencies are not created equal. While Bitcoin is the most well-known and established cryptocurrency, others offer different features and benefits. For example, Ethereum is a decentralised software platform that enables smart contracts and decentralised applications. Cardano is a proof-of-stake blockchain platform that aims to be more energy-efficient and support faster transactions. Litecoin is similar to Bitcoin but offers faster transaction speeds.

Consider the Risks

Investing in cryptocurrencies is a risky proposition. The value of cryptocurrencies can fluctuate wildly, and there is always the risk of losing your entire investment. Only invest what you can afford to lose, and make sure you understand the tax implications and regulatory environment surrounding cryptocurrencies in your country.

Diversify Your Portfolio

Don't put all your eggs in one basket. If you're investing in cryptocurrencies, it's generally a good idea to diversify your portfolio across multiple coins. This can help reduce your risk and expose you to different areas of the market.

Stay Up to Date

The cryptocurrency market is constantly evolving, with new coins, technologies, and regulations emerging all the time. Make sure you stay up to date with the latest news and developments to make informed investment decisions.

Popular Alternatives to Bitcoin

Some of the most popular alternatives to Bitcoin include:

• Ethereum (ETH)
• Tether (USDT)
• Binance Coin (BNB)
• Cardano (ADA)
• Solana (SOL)
• Dogecoin (DOGE)
• Litecoin (LTC)
• Polkadot (DOT)
• Avalanche (AVAX)

Remember, investing in cryptocurrencies is a risky proposition, and you should only invest what you can afford to lose. Do your own research and consult with a financial advisor before making any investment decisions.

Frequently asked questions