The process can be intimidating if you’re new to investing. The set-up is usually an absurd amount of paperwork, and the risks and rewards are often nebulous. What if you can’t stomach those risks or the complexities of investing?
What if you want your money to grow for years without much effort?
You need some form of assurance that your investments will grow reliably with minimal chances of loss. This article provides an excellent beginner’s guide to investing in Gold.
Why Invest In Gold?
The price of Gold has been on a steady rise for the last three hundred years. It is considered a hedge against inflation and has served as the best option for people who want to protect the value of their money over time. Even though other precious metals can be used in investing, none of them carries the longevity and renown of Gold.
If you want to guard against economic uncertainty, Gold investing is the right way to go. There are also other benefits to investing in Gold.
1. Long-term sustainability – There is a reason why Gold has been used as a currency and store of value for thousands of years. The metal’s properties make it possible to keep your investment safe in the long term.
2. Low correlation with the stock market – Gold is one of the best measures to go by if you’re interested in diversifying your portfolio. Gold has no inherent correlation with any other investment asset. It is not bound to the fluctuating stock market, and its fluctuations are negligible.
3. No tax implications – As a result of the unique properties of Gold, it cannot be seen as any form of inventory. This means you will not be required to pay capital gains tax on investments.
4. No third-party interference – Much like with other investments, there is no need for a third party to manage your money in Gold. It does not have any dependency on shareholders’ votes, nor does it depend on the will of banks and governments. Gold is a sovereign investment.
5. It’s a widely accepted form of exchange – Investing in Gold is a way to protect your wealth throughout the world – Gold is the only tangible asset universally accepted as a medium of exchange. This means you can spend Gold in various countries without any problems. There are companies out there like Goldco and Patriot Gold Group that can help you with your gold investing. See any review of Patriot Gold Group to determine if they are right for you.
Different Ways You Can Invest In Gold
Gold can be bought in various forms. Some of the most popular ways of investing in Gold include:
1. Physical Gold
This involves having gold metal in your possession. It can range from gold coins, gold bars, bullions, etc. The form in which you buy Gold will depend on how much you’re trying to invest and your target. Most bullions are stored in secure vaults by companies that act as its custodian. It is one of the safest forms of investment for people who can’t afford to lose money.
2. Gold ETFs
ETFs are similar to index funds but have some differences. ETFs have a significant share in the market since they can be sold and bought just like a stock and are regarded as safe investments. ETFs are also highly liquid, which means they can be sold at any time you want. There are also a lot of gold IRA companies that may be able to help with the ETF side of things.
3. Gold Mining Shares
These are shares you can buy based on the value of Gold at a specific time. There is also no limit on how much you can invest, making it one of the most popular choices for beginners. The shareholders will be directly benefiting from the mining operations of companies who mine Gold as if they were mining for themselves.
4. Gold Certificates
This is a certificate that represents the value of Gold. These certificates can be kept for as long as the holder likes, but Gold must back them. This way, you will get the full benefits of holding Gold without taking on the risk and cost of storing, guarding, or insuring physical Gold.
5. Gold Futures
Gold futures is the right way to go if you are looking for an investment with a long-term perspective. This will allow you to buy or sell Gold at a specific price in the future. You can also gain from the difference in price between your purchase and sale. Futures contracts can be risky, so make sure you know exactly what you are getting yourself into before making a decision.
When To Invest In Gold
One of the biggest mistakes beginners make is investing at the wrong time. There are some times when investing in Gold is more or less advisable. Though it is better to research before you decide – here are some basic pointers to consider when investing in Gold.
- For long-term investments – If you can afford to keep your investment long-term, it’s a good idea to invest over a long period. The price of Gold moves in a generally upward trend, and its rate of growth is much higher than any other investment.
- If you’re interested in diversifying – Investing in Gold is one of the best ways to diversify your portfolio. It will give you a well-rounded skill set that encompasses different areas of the financial markets. You can start by buying small amounts and then build up your wealth as you gain experience.
- When the economy is unstable – If you want to protect your wealth from high inflation and other short-term factors, investing in Gold is a good way to go. There are other economic indicators that can help you decide if it’s a good time to invest in Gold, for example – when interest rates are low, or there are currencies devaluation or hyperinflation, etc.