E-MONEY: 3 THINGS TO DO BEFORE YOU BUY CRYPTO

Investing in cryptocurrency can be as easy as a few taps on your phone, and with crypto all over the news and coming up in conversations with friends, it’s tempting to dive right in. However, depending on your financial situation and appetite for investment risk, crypto might not be an appropriate investment for you right now — or ever.

“I am the biggest crypto hippie you’ll talk to in a very long time,” says Tyrone Ross, CEO of Onramp Invest, a crypto asset platform for registered investment advisors. And yet, he cautions against it. “I don’t think the general public should be investing in crypto.”

Picture your finances as an ice cream sundae, with crypto as the cherry on top. It makes up a small proportion of the overall sundae, and not everyone wants one. And before you fish that cherry out of the jar, you need to assemble the rest of your dessert. In non-ice-cream terms, that means creating a strong financial foundation and learning everything you can about crypto before you put any real money in.

1. PUT FINANCIAL SAFEGUARDS IN PLACE

First and foremost, you need to prepare for those times when things don’t go as planned.

Over the past year, workers who lost income because of the pandemic had to tap into savings, take on debt or enter into hardship programs to afford their bills. This time has been a stark reminder of the importance of having an emergency fund.

“When you’re young, you can feel like Superman or Superwoman, but when the bubble happens, you could easily be out of a job for nine to 12 months,” says Theresa Morrison, a financial planner in Tucson, Arizona. “Don’t underestimate systemic shocks to the market.”