Knowing how to invest in gold or where to buy it can be a tricky and long process… If you don’t know what you’re doing that is.
The trouble is, most people don’t have a clue about investing in gold.
But don’t worry.
I’m going to show you exactly how to invest, where to invest AND what types of gold you should be buying if you want to make some money.
Not only that, but I’m also going to show you what dangers, scams and pitfalls you need to watch out for, so you don’t lose your hard earned cash.
Lastly, you’re going to learn how to sell gold, so you can get the best return possible.
Ready to get stinking rich from gold? (ok, maybe not rich, but a nice little nest egg that you can retire on for sure).
Let’s do this…
6 reasons why you should be investing in gold right now
Gold is a solid investment (no pun intended).
Every serious investor has some amount of gold in their portfolio. It’s a tried and tested asset that gives you a great return, whether physically or in stocks.
So let me start by convincing you why you should be spending some of your moolah on this shiny stuff.
Here are 6 reasons why you need to invest in it…
1. Used to exchange value for thousands of years
Gold jewelry has held it’s value since the early days of civilization. From the Chavin civilization of Peru around 1200 BCE, who used gold in castings to the Egyptians in 5000 BCE who used Electrum (the naturally occurring alloy found in gold and silver) in jewelry.
Even today, gold is used in jewelry and bought/sold by millions of people worldwide. That jewelery holds aesthetic value and currency value, unlike many other natural materials.
2. Never loses value
Despite market fluctuations, gold will never really lose it’s value. It will always be used to exchange goods in place of money and hold true value, regardless of where you are in the world.
Since 1970, the price for an ounce of gold has rocketed from $35.17 to a ridiculous $1,313.30 (as I’m writing this now).
That’s a MASSIVE rise in value! You would never get that type of value holding from paper currency or coins.
3. Can be used in emergencies
Even if there is a state of emergency and the banks shut down (they can actually refuse to give you your money, or conduct a bail-in which is where depositors cash is used to “bail-out” the bank). You can still use your gold as money for essentials. Either to barter or to melt down and swap for cash with someone who has reserves.
That is why governments use gold to back currency, because of it’s immense value. Take the infamous Fort Knox for example, the US have a reported 2.3% of all the gold in the world stored there.
In real money that is said to be worth $261.6 billion dollars, WTF!
4. Doesn’t care about inflation or deflation
During the down periods in history, investors have found gold to be one of the best investments to hedge against inflation, because it’s price goes up even though the cost of living increases.
You can pick any year in the last 50 years that shows high inflation and gold has surpassed it. Same goes for deflation. Even in the great depression of the 1930’s, gold still smashed it.
5. It’s finite
How much new gold do you think is produced every year? Millions of tons right?
WRONG!
50 million troy ounces of gold is produced per year. That equates to about 14 feet cubed. One big fat cube of gold!
Yes seriously, that’s it.
Anything that is considered finite will keep rising in value until there is none left to produce. That’s because demand naturally increases when something is harder to get your hands on (like a leggy blonde that can cook and is great in the bedroom).
6. Perfect asset for any portfolio
Ask any big time investor if they have any gold as an investment, either physical or tied up in stocks. I guarantee you, they will say yes.
Why? Because gold is an amazing asset for diversification. Any time there is a whiff of trouble in the stock market, gold rises.
Smart men diversify, they don’t buy one thing and hope it makes them money.
The 4 types of gold you should be buying
When you think of gold, you might think… jewellery… or big heavy bars. But there are actually four types of gold that you can invest in AND have a positive return on if you’re smart.
- Gold bars: You’ve seen them in the movies, the big chunky solid gold bars that weigh a ton. As far as physical investments go, gold bars are the mac daddy. They are usually kept in secured vaults under high security.
- Gold coins: Small and less pricey, coins are a great investment for first timers. They can be stored at home or in a vault for a small cost.
- Gold stocks: Buying shares in gold or betting on the market fluctuations can net you some serious money, but you need to be smart with it. Most investors would go bullish on gold in times of turmoil.
- Gold jewellery: The most overlooked form of investment. Gold jewellery is easy to keep locked up in the house, or even enjoyed by wearing it, and a great backup for any type of Mad Max scenarios that might unfold in the future, where you would want small objects to barter. Who knows right? Just make sure that the jewelry you buy is as close as possible to the melt-down value of the gold content.
How to buy gold even if you’ve never done it before
Ok, so here it is. Your guide to buying and investing in gold.
When is the right time to buy?
The best time to buy is when when there is a breakout in the gold price, when you expect high inflation (due to issues with the economy in your country) or there are major political problems that are set to shake up the system (like a Brexit for example).
Those are ideally, the best times to buy. But in reality, there’s no bad time to buy gold.
How much should you invest?
In my opinion, you should be investing between 3-7% of your net worth on gold. You might think that’s a lot, but your cash (if you think about it) is essentially worthless and is dependent on a strong economy.
By keeping your money in the bank, you risk losing in more ways than one. If you have say $20,000 in savings, just by gold with it. I highly doubt you will regret it.
Best places to buy gold
There are three places I’d recommend you buying gold online from…
1. Regal Assets – The leader in selling bullion. They specialise in US markets, but do sell overseas also.
2. Gold Broker – Amazing support, extensive range of gold and offer silver/platinum as investments also.
3. Bullion Vault – One of the largest and most recognised bullion brokers online, that help you to buy/sell and store gold.
Storage for physical gold
Now some people (mainly conspiracy folk) like to store their own gold in a private vault or safe, even under the bed.
Is this a good idea? Well yes and no. If someone knows you store your investments in your house, you may find a few hoodrats breaking in one day. The upside to it is you don’t have to wait for someone to deliver your investment, it’s just there waiting for you.
Just comes down to your preference really.
Diversifying your assets (physical and paper)
I would wholeheartedly recommend you buy as much gold as you possibly can. Both in stocks and physical assets.
The reason is simple.
There are more chances to make money, the more options you have. If you lose money in the markets, you have the physical as a backup.
How to sell gold for maximum profit
The selling process greatly depends on what type of gold you actually have. So let’s run through some scenarios…
- Stocks: Sell when the market is demanding more gold. Meaning a recession has hit, there are talks about a recession, political unrest is happening or a currency is plummeting.
- Physical bullion: If you have coins, ingots or bars, then they can either be traded through brokers, sold privately to gold buyers or melted down and sold. I would only melt, trade or sell my gold if the price was at an all time high or I needed the cash.
- Physical jewellery: These are considered the scraps really. You may have a gold chain that you didn’t sell from way back in the day or a gold ring your father used to own before he passed away. This type of asset is good to sell if you need emergency cash.
There are several ways you can sell your gold. Stocks will be sold through brokers either on the phone or online and physical bullion is done again either through brokers or you can sell it directly to a buyer (person or shop).
The dangers of investing in gold
You know what?
There really aren’t any dangers of buying gold.
The only downside of it is that it doesn’t provide you with a passive income like stocks or real estate do, hence why it’s wise to use gold for diversification.
Now it’s your turn…
I’ve given you everything you need to know on how to invest in gold so you can go off and make real investments. You now know how to buy, when to buy and when to sell.
All you need to do now is TAKE ACTION.
Do you think there’s anything more I could add to this guide? If so let me know.
