Digital currencies, most notably bitcoin, have generated a lot of attention this year. Should cryptocurrencies be an option for 401(k) participants?

Year to date, bitcoin is up about 37%, beating the stock market, as measured by the S&P 500 Index, by far (up 17.6% as of 7/29/2021). What is not visible, however, is the wild ride that intervened. Bitcoin reached an all-time high of $64,829 on April 14, 2021, according to CoinGecko (tinyurl.com/ax3p5hh9). On July 29, bitcoin traded between $38,349 and $40,409 (see CoinDesk: tinyurl.com/mj9nceee).

Bitcoin was approved as legitimate government currency in El Salvador in June, with the new law taking effect in September (tinyurl.com/y9wths32). Some NFL players have requested to be paid in bitcoin, as detailed on the website Buy Bitcoin Worldwide (tinyurl.com/53f76w6n). It was also the currency of choice when hackers demanded payment to end their encryption malware cyberattacks on Colonial Pipeline and JBS (tinyurl.com/324vs6je).

When I last wrote about bitcoin in August of 2017, I noted that “both regulators and speculators have been drawn to this virtual currency. Speculators are attracted by the possibility of outsized returns (and, as with any speculative ‘investment,’ there is a potential for outsized losses). And regulators raise warnings.” That’s one huge point of concern: Four years later, regulators are still sorting out whether cryptocurrencies should be regulated -- and if so, how?

The past few months have illustrated some of the issues. In May, during testimony before a House subcommittee (tinyurl.com/ud497mrz), Securities and Exchange Commission (SEC) Chairman Gary Gensler, citing concerns about “greater opportunities for fraud and manipulation,” said he wanted to work “with fellow regulators and with Congress to fill in the gaps of investor protection in these crypto markets.”

On July 7, Sen. Elizabeth Warren, D-Mass., called for answers about the SEC’s authority for protecting consumers who invest and trade in cryptocurrency. In a letter to Gensler (tinyurl.com/t32dxjv7), Warren wrote: “As the cryptocurrency markets continue to grow and expand, the lack of regulation to provide basic investor protections is unsustainable. The SEC regulates national securities exchanges, and cryptocurrency exchanges that operate in a similar manner should be subject to similar regulatory standards.” Warren also noted the “potential need for Congress to take additional action on these matters.”

Warren sent a separate letter later in July (tinyurl.com/4zj74sfp) to U.S. Treasury Secretary Janet Yellen, asking Yellen, in her role as head of the Financial Stability Oversight Council, to “mitigate the growing risks that cryptocurrencies pose to the financial system.”

The SEC’s Office of Investor Education and Advocacy and the Commodity Futures Trading Commission’s Office of Customer Education and Outreach released an Investor Bulletin in June about funds trading in bitcoin futures contracts (tinyurl.com/64v9rhbs), urging investors to “weigh carefully the potential risks and benefits of the investment.”

The future of bitcoin offerings for 401(k) plans may already have arrived. “Alt 401(k),” offered through ForUsAll (forusall.com), allows 401(k) plan participants to direct up to 5% of their balances to 50-plus different cryptocurrencies (tinyurl.com/xchmntwt). Coinbase Institutional (coinbase.com) is the cryptocurrency platform for the offering.

If you are a regular reader of this column, you can probably guess what my position might be on offering crypto through a 401(k) plan, a subject I will address in an upcoming column. In the meantime, what’s your position? Would you like to see cryptocurrency in your 401(k) plan? Either email me or take a few minutes to tell me through a five-question survey, the results of which I will share with you in a later column. The survey link is tinyurl.com/yf7cbbcv. If you write to me (readers@juliejason.com), please be sure to include your city and state, and the name of your newspaper.

Julie Jason, JD, LLM, a personal money manager (Jackson, Grant Investment Advisers Inc. of Stamford, Connecticut) and award-winning author, welcomes your questions/comments (readers@juliejason.com). Please visit www.juliejason.com.

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Beyond the headlines about Social Security cost-of-living adjustments and changes in leadership, there is an ongoing need to warn anyone with a Social Security number to be alert to identify theft. Stealing someone’s Social Security number is a gateway to financial fraud.

Be alert to these maneuvers.

Scammers are using a telephone call, text message or email in an attempt “to convince the recipient that they need to provide Social Security numbers, bank account or credit card information or passwords.” This is one of the categories highlighted in the IRS’s list of “Dirty Dozen” scams this year (tinyurl.com/2x96xsuh).

We need to “be alert for a continuing surge of fake emails, text messages, websites and social media attempts to steal personal information,” warns the IRS.

Phone scammers are even creating fake versions of ID badges that most federal employees use to access federal buildings, then texting or emailing photos of the fake badges to potential scam victims, according to the Social Security Administration’s Office of the Inspector General (tinyurl.com/5eh6s6ha).

Heed the regulators’ warnings. If you visit the Social Security website (SSA.gov), you won’t be able to miss the red banner near the top asking “What should I do if I get a call claiming there’s a problem with my Social Security number or account?”

Clicking on that area will lead you to a FAQ page (tinyurl.com/9ud4a78v) that details what the Social Security Administration (SSA) will or won’t do when it comes to phone calls. For starters: “If there is a problem, we will mail you a letter. Generally, we will only contact you if you have requested a call or have ongoing business with us.”

SSA employees “will never threaten you for information or promise a benefit in exchange for personal information or money”; and “If you receive a questionable call, hang up, and report the call to our Office of the Inspector General.” The website for reporting it is oig.ssa.gov.

Also watch out for “phishing” schemes, in which scammers use email to trick a recipient into either revealing personal information or interacting with a link or attachment that is malicious. The SSA has information for combating that tactic as well (tinyurl.com/2h7uxy58). Highlights from that page:

• “Most emails from Social Security will come from a ‘.gov’ email address. If an email address does not end in .gov, use caution before opening attachments or clicking on pictures or links in the email.”

• “Links, logos or pictures in the body of an official Social Security email will always direct you to an official Social Security website.”

• “If you are not certain that an email you received came from Social Security or one of our marketing firms, DO NOT respond to the email or click on any links contained in the email message.”

What if you receive a text from the SSA? Expect a legitimate text only in limited situations, such as if you have subscribed to receive updates and notifications by text, or as part of the security protocol when accessing a “my Social Security” account.

Signing up for the “my Social Security” account is a good idea, as the SSA believes it can help you “identify any suspicious activity.” If you haven’t signed up yet, go to ssa.gov/myaccount.

“In 2020, people filed more reports about Identity Theft (29.4% of all reports), in all its various forms, than any other type of complaint,” according to the Federal Trade Commission’s Consumer Sentinel Network Data Book 2020, released in February 2021. Government agencies continue to send out warnings about the danger.

To learn more about scams targeting Social Security accounts, go to oig.ssa.gov/scam. You also can learn more about preventing and reporting fraud at ssa.gov/fraud.

Julie Jason, JD, LLM, a personal money manager (Jackson, Grant Investment Advisers Inc. of Stamford, Connecticut) and award-winning author, welcomes your questions/comments (readers@juliejason.com). Please visit www.juliejason.com.

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If I think we’ll all agree that good communication makes for a good relationship, whether that be between financial advisers and their clients, co-workers, friends or spouses. In my experience over three decades as a money manager and one decade as an arbitrator, I can confirm that problems start with miscommunication.

Given that frame of reference, it’s always good to hear when things are going well. A new survey from Fidelity focusing on couples (tinyurl.com/4sf87k69) concluded that 71% of partners communicate at least “very well” with their other half about finances -- including 25% who say they communicate “exceptionally well.”

However, the survey, as usual with these sorts of things, found room for improvement.

Just how much should a partner know about family finances or how their partner feels about discussing financial issues? Should you know how much your partner earns? (Two out of 5 surveyed did not know.) Should you be able to discuss health and lifestyle as easily as careers and estate planning? (Couples found it easy to discuss health and lifestyle and “most difficult” to discuss careers and estate planning.)

What about the tone of your discussions? Should finances cause arguments or relationship challenges? (Forty-four percent admitted to arguing about money at least occasionally, while 18% said that money is the greatest challenge in their relationship.)

What about how you make decisions on big financial matters, such as retirement? Do you do that jointly? (Fifty-seven percent of respondents said they are joint decision-makers when it comes to retirement and other long-term financial goals.)

Do you agree on how much you need to save for retirement or when to retire? (Fifty-one percent of non-retired couples disagreed on how much savings is needed to reach retirement, and 48% disagreed on the age they were expecting to retire.)

If one of you becomes incapacitated, will you feel confident that your partner can take over? (While almost half of the respondents had complete confidence in either themselves or their partner to take over decision-making capabilities for day-to-day finances and short-term goals, when it came to taking full control of finances and strategies for retirement, only 4 in 10 felt completely confident in their or their partner’s ability to do it.)

If you are a wife, do you want to have input in planning for retirement? Twenty-two percent of women said they had little or no input with retirement planning. Considering that women tend to live longer than men -- a National Center for Health Statistics report in February 2021 (tinyurl.com/p43cchrc) found that the life expectancy for males at birth was 75.1 years in the first half of 2020; for females it was 80.5 years -- this is not good news. One of the things I encourage in my practice is that both partners be equally knowledgeable and comfortable about financing the future.

If you were lucky enough to be in a good-communicating partnership, would you expect to be content with your family’s finances? (Yes, indeed. For those couples who said they communicated well, 73% rated their household’s financial health as excellent or good, compared with 42% for couples who said they did not communicate well).

That data point is hard to ignore. From my own experience, I can tell you that there is nothing more important than open and clear communication between partners, aging parents and their adult children, and anyone who needs to interact socially, within a family or on the job.

If your communication skills need some help, there is no better time than right this second to start. Take just one step toward better communication. How? Take the initiative. Ask some of the few questions we discussed in this column. Listen to the answers.

Fidelity, one of the largest asset managers in the world, offers some additional tips at tinyurl.com/3pwu3w9b.

The 2021 version of the Fidelity Couples & Money study surveyed 1,713 couples with a minimum household income of $75,000, or at least $100,000 in investable assets.

Julie Jason, JD, LLM, a personal money manager (Jackson, Grant Investment Advisers Inc. of Stamford, Connecticut) and award-winning author, welcomes your questions/comments (readers@juliejason.com). Please visit www.juliejason.com.

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