From 24/7 Wall St. · Sam Daodu · · 1m 20s
Bitcoin 401(k) Drop Risk
Bitcoin's 34% plunge from record high: should retirees hold it in retirement accounts?
In brief
Bitcoin's 34% plunge from record high: should retirees hold it in retirement accounts? Retirees should limit Bitcoin to 5% of 401(k) to avoid 2% loss from 34% drop. Originally reported by 24/7 Wall St..
Bitcoin Plunges 34%
Bitcoin dropped 34% from its record high of $126,080 set on October 6, 2025.
Retirement Risk
A 34% drop could cost retirees 2% of their 401(k) if they hold 20% in Bitcoin.
Labor Department Rule
The Labor Department proposed a rule allowing 401(k) plans to include cryptocurrencies by March 30, 2026.
Tax Opportunity
Converting Bitcoin ETFs to Roth IRA at lower prices can reduce taxes but may raise Medicare premiums.
Medicare Impact
Income from Bitcoin conversions could raise Medicare premiums by $1,949 annually for married couples.
Recommended Strategy
Retirees should limit Bitcoin to 5% of their 401(k) to avoid 2% loss from a 34% drop.
IRA Alternative
Rolling over a 401(k) into an IRA allows Bitcoin investments without new employer approval.
Bitcoin Recovery
Bitcoin would need a 52% rally to return to its record high of $126,080 from current $82,820.
What Happens Next
Retirees should monitor Labor Department rules and spread Bitcoin conversions over years to avoid Medicare impacts.
At a glance
Retirees should limit Bitcoin to 5% of 401(k) to avoid 2% loss from 34% drop.
