My niece was born a couple of days ago and my girlfriend suggested we start putting some money away to help her buy a car 18 years from now. Instead of offering toys or clothes for her birthday or as a Christmas gift we just keep on putting more and more money away for her. We're still at an early stage in life so there's only so much we can spare but the idea is to add at least $200 per year.

My grandma did the same for me every year since I was born and by the time I wanted to buy a car the money came in very handy. It helped to pay for a good portion of the car. This was back in the day when banks and government bonds paid a decent yield so every cent she invested for me was able to keep pace with inflation.

I cannot keep the money sitting around in a savings account yielding 0.5% APR, at the end of the 18 years my $100 would be worth $63,40 (Average inflation rate of 3%). I have to check what other safe alternatives are out there.

Current Reality

I didn't want to invest in risky assets with the money we put away so I decided to go and check how much yield the same old vehicles my grandma used for me were offering. They're an absolute disgrace!

If I invest $100 I would get $105,19 after taxes at the end of SEVEN YEARS. Has the world gone mad? Who in their right mind puts money into this scam?

They do offer an additional 20% of the GDP growth as yield but it has been negative and will keep being negative for the foreseeable future so there's no point in making projections with anything other than the flat rate.

We're seeing 9.1% year-over-year inflation and the best product they can come up with offers 5.19% PER SEVEN YEARS. Let's assume an average inflation of 3% for the next 7 years, my $105,19 will be worth $84,99 seven years from now. What a great way to see 15% of my money vanish into thin air (The government pockets).

Crypto and Stocks

I have two alternatives, seeing the money we put away devalue every year or investing it in risk-on assets. The first option will lose money 100% of the time so I really have no other alternative than to invest in crypto and stocks. Sure I could lose some or all of the money but it's worth it, plus I have some experience and will be monitoring and tweaking the portfolio as needed.

For the first few years, I'm probably going to throw all the money into crypto. I will be deploying the first $100 this week, 50% will go into BTC and 50% will go into ETH.

Storing the Crypto

Celsius should have thought me a lesson about keeping funds in decentralized exchanges but since it is only $100 I will keep all of it on the FTX mobile app (Not FTX PRO). They're currently offering 8% APY on all cryptos paid hourly and it seems like FTX is one of the most solid crypto companies out there. Appearances can be misleading but if FTX goes under so will the entire crypto market, I might as well be hanged for a sheep as a lamb!

18 Years of Growth Ahead

Starting a new portfolio from fresh is very exciting, mine has been all over the place and it is "impossible" for me to go back and track all my gains and losses over the years. My niece's portfolio will be way easier to track and manage.

Can't wait for her to turn 18 and have a massive amount of money waiting for her. I will make sure to show her every step of the process.
Hopefully, the experience will teach her how important it is to invest from a young age and have your money working for you and not the other way around.

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