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by Emma Newbery | Published on Oct. 3, 2022
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Crypto investing isn't the only gig in town.
The Ascent's best crypto apps for 2022 (Bonuses, $0 commissions, and more)
It’s been a rough year for cryptocurrency investors. The total market cap — the value of the whole crypto market — has fallen from almost $3 trillion to less than $1 trillion. Many top cryptos are down as much as 90% or more on their all time highs. Sadly, a lot of people who bought crypto for the first time last year are now underwater on their investments.
Some crypto investors see this period of prolonged low prices as an opportunity to buy crypto at a discount. Others are looking at other ways to build wealth, and there are plenty of them out there. The first step is to make a plan and define what approach you want to take. This depends on many things, including your tolerance for risk, your financial situation, and the amount of time you want to put into managing your investments.
Here are four steps to take.

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According to a study by Ramsey Solutions, eight out of 10 millionaires contributed to their 401(k) plans and three quarters said that regular, consistent investing was a key part of their success. If your company has a 401(k) plan, max out your contributions, particularly if your employer matches what you put in. It’s essentially free money.
If you’re self-employed or your company doesn’t offer a 401(k), look into other tax advantaged retirement accounts. For example, depending on your tax situation, an IRA or Roth IRA could help you save for your old age in the most tax-efficient way.
Just as when you first bought crypto, understanding other types of investing can seem daunting at first. Take it slowly and learn everything you can before you jump in. Think about your risk tolerance and how you will build a balanced portfolio of investments. If you’re nearing retirement, you might opt to put a certain percentage of your money into bonds, which carry less risk than stocks.

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We’ve found one company that’s positioned itself perfectly as a long-term picks-and-shovels solution for the broader crypto market — Bitcoin, Dogecoin, and all the others. In fact, you’ve probably used this company’s technology in the past few days, even if you’ve never had an account or even heard of the company before. That’s how prevalent it’s become.
Sign up today for Stock Advisor and get access to our exclusive report where you can get the full scoop on this company and its upside as a long-term investment. Learn more and get started today with a special new member discount.
In terms of equity investing, once you’ve opened a brokerage account, you don’t have to buy individual stocks, particularly if you don’t have time to actively research and manage your investments. Other ways of investing include mutual funds, exchange-traded funds (ETFs), and index funds. Index funds track a stock index, such as the S&P 500, whereas mutual funds are actively managed by a fund manager.
The trick to investing money is to think long term. The stock market could have a bad year and go down in the short term, but historically, over time it has produced strong average returns. However, to build wealth, it’s important to only invest money in stocks and bonds that you don’t plan to touch for the next five years or more. To do that, you’ll also need money put aside in a savings account.
An emergency fund that can cover three to six month’s of living expenses — or more — is an important building block. It can give you security so that if you hit a financial crisis, such as a job loss or medical emergency, you’ll be able to cover it without touching your investments or going into debt.
Another key factor is living below your means. It isn’t as exciting as buying crypto and becoming a millionaire in a matter of months. But spending less than you earn and saving or investing the rest is one of the few surefire ways to get rich over time.
If you’re carrying high interest credit card debt, you’re not alone. However, it is a huge obstacle to wealth-building, as it eats into your income and costs you money over time. As a rule, if your debt costs you more than the interest you might earn by investing, it makes sense to prioritize paying down debt.
According to The Ascent research, the average credit card APR is 16.4%. In contrast, the average returns from the S&P 500 between 2012 and 2021 were 14.8%. Everybody’s situation is different, but be aware of the amount of debt you carry and what it is costing you.
If your crypto assets are worth a lot less than you paid for them, the desire to cut your losses is understandable. However, don’t sell your crypto because of falling prices alone. Think about whether your original reasons for buying still hold true and how you think it might perform in the long term.
You may be keen to get out of crypto altogether, but panic-selling could prove costly. If you sell, you lock in your losses and won’t benefit if prices eventually recover. If you think individual coins and tokens can survive the crypto winter and your financial situation allows it, you might keep your existing holdings and put any new money into different forms of wealth-building.
Any kind of investment losses can be beyond disappointing. But if your crypto portfolio is on the rocks, try to see this as an opportunity to put different financial foundations in place — ones that will help you build wealth over time. Crypto prices may come back, but if you have a diversified portfolio and aren’t overly reliant on any single asset, your financial success won’t be dependent on a crypto recovery.
Emma owns the English-language newspaper The Bogota Post. She began her editorial career at a financial website in the U.K. over 20 years ago and has been contributing to The Ascent since 2019.
We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.
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