#1) Gold is a true safe haven. It never needs bailed out. It never defaults on obligations. Gold cannot be delisted from stock exchanges. It can never be shut down by regulators. Gold never goes out of business.
#2) Physical Gold cannot be hacked! Therefore, it is immune to malware, viruses, or even large-scale cyber attacks. It is also immune to phishing emails, forgotten passwords, etc...
#3) You do not need electricity or an internet connection to access physical Gold in your possession. Which means you will still have your physical Gold during blackouts, which are becoming more common, and during bad storms or disasters.
#4) Gold has recently been reclassified as a Tier 1 asset under the Basel Accords.
#5) Gold does well in times of complete economic collapse. Gold also does well during both inflation & deflation.
#6) Gold has no counterparty risk. There is no institution, business, or person that could ever make your Gold of no value. Your physical Gold does not depend on your bank, broker, credit score, internet service provider, or utility company.
#7) Gold maintains purchasing power over time. When other assets are measured in terms of Gold and not cash, it is proven to be a stable form of wealth preservation. For example, an average family home today priced in Gold is roughly the same as what an average house cost in the early 1900's.
#8) Owning Gold is a great way to protect against an over-reaching government or a power hungry politician. The last few years have shown that if someone says or does the wrong thing, or even believes a certain way, they may have their bank account or business closed.
#9) All paper currencies fail sooner or later. All fiat money eventually goes to zero. The US Dollar is no exception. It has lost about 96% of it's purchasing power since it's inception.
#10) Gold acts like a type of insurance policy. It is a good way to keep value 'out of the system'. If all else fails, you still have Gold to fall back on.
#11) Gold is a stable store of value. Unlike the US Dollar and other fiat currencies. For example, according to the U.S. Bureau of Labor & Statistics, the purchasing power of the dollar declined about 7.4 percent between 2021 and 2022. Every year, the purchasing power of cash erodes just like this.
#12) Central banks around the world have been investing in Gold. The year 2022 was a record breaking year for Gold buying by central banks. They are quietly preparing for something.
#13) Gold is a great way to diversify a portfolio. Many people think diversification means owning many different types of stocks in their brokerage account. True diversification means owning multiple asset classes in multiple locations. This is exactly what owning Gold accomplishes.
#14) Gold is decentralized. It is mined worldwide and traded on a global market too. There is no single entity that controls Gold. This cannot be said of other asset classes. For example, stocks are controlled by the particular company and regulators. And U.S. Treasuries are controlled by the U.S. government. Gold is truly decentralized though.
#15) Gold has withstood the test of time by being used for thousands of years. It is deeply embedded in the human consciousness. This is why Gold is used in movies and cartoons when there is treasure or wealth involved. Another example is how it's used to convey importance (eg. Gold membership, Gold member, Gold card, Gold tier, etc).
#16) Gold is durable, unlike paper money which can be ripped or burned. It is much more durable than other valuable items such as fine art and collectibles.
#17) Gold lasts forever since it is highly resistant to rust and corrosion. Gold also does not get water damage and it does not decay or rot. It does not even tarnish over time.
#18) Gold is very portable. A whole suitcase of money would be needed to buy what a little Gold Bar can.
#19) Gold is a great way to save for retirement. For example, you could set up a Gold IRA. Or you could set up an automatic recurring debit from your bank account to purchase some Gold each month. The Gold would be shipped and stored in a vault for you. It would be protected 24/7 by security and insurance. A little Gold saved every month like this would turn out to be a lot when retirement comes. Money Metals Exchange is a good provider of such a service.
#20) Gold is not subject to capital control restrictions (eg. Greece, Cyprus).
#21) Physical Gold is extremely liquid. That is, there will always be buyers to sell your Gold to.
#22) Owning Gold can be private and confidential.
#23) Physical Gold is low-maintenance. It does not need fed like cattle or watered like corn. It requires no power to run. It does not go bad if left sitting for a long time. You could buy a Gold coin and hide it in your house and it will be the same after a year, 10 years, or even after hundreds of years.
#24) People flock to Gold in times of geopolitical uncertainty (eg. Brexit).
#25) Gold is an excellent way to protect yourself during a recession or even worse.
#26) There is a limited supply of Gold which cannot be increased like paper money can. For example, the US government has created trillions of new Dollars into existence over the last few years alone.
#27) Supply of Gold is falling due to falling mining production and it is projected to continue falling. New Gold discoveries have also been falling and are projected to continue falling.
#28) Gold has so much utility and function. It not only is used as a monetary metal, but it's also used in jewelry, in the aerospace industry, in all sorts of consumer electronics, and in dentistry. It's also used in collectibles such as Gold plated cards and figurines.
#29) Gold is used in medicine. For example, it is used to treat rheumatoid arthritis. Also, there are many health benefits to Collodial Gold. Every time Gold is used in medicine, it cannot be recovered and the supply of Gold decreases.
#30) Gold is crucial for certain technologies since it has unique properties that other metals do not have. It is used where high-efficiency, heat/light shielding, or extra reliability are needed. For example, Gold is used to make computer processors and where important contacts are needed like SIM cards and bank cards. It is also used in the space industry and in high-tech weaponry. As demand for these electronics and technologies grow, so will the demand for Gold.
There are many reasons, but there are 5 very important reasons why:
#1) Economic conditions around the world have deteriorated so badly in the last few years. Inflation is now out of control and the average personal life savings rate is at a low point. Gold is a perfect way to protect against these bad economic conditions.
#2) All paper currencies eventually fail. There has never been a paper currency that has never failed after enough time. To the contrary, Gold has never failed and has been a consistent STORE OF VALUE throughout history.
#3) Over the last few years, we have seen reckless decisions from world leaders. They have been making poor decisions, one after the other. Some have proven to be power hungry and have frozen bank accounts, forced businesses closed, and so on. Gold is a great way to diversify assets and get some 'out of the system'.
#4) Central banks have been buying Gold like crazy. They know what's coming. They acquired 1136 tons of Gold in 2022, which is the most in any year going back to the end of WW2.
#5) Billionaires are buying Gold. There is a reason Billionaires are Billionaires and that is because they know how to invest. The "smart money" has been investing with Gold.
Yes! You could invest in exploration or mining companies. These companies do the hard work of exploring for Gold and producing Gold. They actually own physical Gold & Silver in the ground. So their share prices are directly correlated to the spot prices of Gold & Silver.
Here are the Stock ticker symbols which US investors may want to consider:
You could also set up a Gold IRA. This type of IRA would hold real Gold coins, for example. So you could have all the benefits of owning Gold without actually holding or storing the Gold yourself. A Gold IRA professional can guide you every step of the way.
Very Easy! Gold is very liquid. That is, it is very easy to sell Gold to a buyer. Below are some of the places someone will be able to sell their physical Gold at.
Most reputable bullion dealers offer "buy back" programs. In other words, they will buy back whatever they have sold you. You would simply deliver the Gold to them, either in person or through insured mail, and they would pay you for your Gold.
Online stores like Amazon
Local pawn shops
Local classified ads (eg. Craigslist)
Local auctions
Local precious metals dealers & coin collecting shops
Online auctions (eg. Ebay)
Depending on your location, even some banks may buy your Gold from you near spot price.
There are a few ways investors can do this:
Gold Depository - This is a recommended method for storing your Gold. A good provider is the Texas Bullion Depository which is run by the State of Texas. You could also store your metals overseas FREE using Kinesis. They offer fully secured and insured overseas vaulting.
Gold IRA - Physical Gold can be stored for you at an IRS-approved custodian. They are secure, insured, and government-approved. A Gold IRA can be opened in only a few steps. A qualified professional would be happy to answer any questions you may have and help you every step of the way.
Home safe - A dual safe with combination/key is recommended. Most electronic safes can be hacked too easily. And most combination safes can be opened by a professional quickly too. You want a heavy one. It would make little sense to have a light safe which someone could just run off with quickly. Also, it would make little sense to have a cheap safe that someone could crack open with a crow bar. So a sturdy, heavy, dual combination/key safe is recommended. You could even bolt it to the wall or floor for extra security. Or better yet, have it hidden inside your home somewhere. The idea is to make it as difficult as possible for a potential thief to take your Gold.
Local storage rental - You could keep your Gold inside a safe located inside your own storage unit at a local storage company. As long as you pay the fees and purchase renter's insurance, all should go well. Make sure they are a registered company, have 24/7 security cameras, and have restricted access (eg. fully fenced, locked doors). This method has 3 layers of protection. A potential thief would first need to get into the storage facility. Then they would need to get into your unit, which would be locked. Then they would need to get inside your safe which would be inside your unit. So a potential thief would have 3 layers of protection to get through until they get to your Gold.
Bank safety deposit box - These are not recommended, but are secure and cheap. They typically cost around $100 per year. Disclosure requirements of contents is typically minimal or none. You could visit your bank during the week to check on your Gold too.
Recommendation: Diversify your Gold into multiple locations. For example, you could keep 50% of your Gold in a Depository or Vault. And the other 50% can be split up between a home safe and a local storage unit. If you ever heard the saying, "Don't put all your eggs in one basket", this is exactly the time to apply this advice.
There are certainly some advantages of investing in a Gold ETF. For example, they can be invested in just as easily as stocks can. Also, with an ETF there is no physical Gold that needs stored. However, investing in real physical Gold instead of an ETF is recommended. Here is why:
#1) Anything electronic can be hacked. Banks and companies get hacked on a daily basis nowadays. With enough experience and enough time, a hacker could possibly change or remove your ownership of the ETF. Real Gold in your possession cannot be hacked.
#2) During a major financial calamity, the stock exchanges can be suspended. This has happened in history. If this were to happen, you would not be able to do anything with your ETF investment. However, if you owned real physical Gold, you would be able to do whatever you want with your Gold!
#3) Your privacy is compromised. Any ETF must be traded through a registered broker-dealer who is required by law to know everything about you. They are required to report all trades to the government also. Which includes any profit you have made. Buying real Gold, whether it be allocated Gold held in a depository through BullionVault or a Bullion dealer such as Provident Metals, is more anonymous. They are not required to report anything to the government unless certain rare circumstances are met.
#4) Not all ETFs are even backed by real Gold. You would just be investing in something tied to the price of Gold, but not actual Gold itself.
There are advantages to both and it just depends on your preference.
Bars are cheaper. So if you are looking to get more Gold for your money, bars are what you want. Bars usually will be encapsulated inside a plastic holder which will show information about the bar (eg. assayer, weight, serial number), but coins will not unless they have been certified. So if you want a more professional looking investment, bars are what you want.
Bars also are not mixed with other metals. Unlike coins which are sometimes mixed with other metals. So for the sake of efficiency and space, bars are the best choice.
The reason why coins are more expensive is because they not only have value from the Gold content, but because they also have numismatic value. In other words, people buy them as collectibles. Since they are more expensive upfront, they also have a potential to increase in value more than a bar would. If a certain coin becomes more in demand, the value of that coin will go up regardless of the metal content. So the potential to profit increases with coins.
Since Gold coins are also collectibles, they are more liquid than bars. Which means you would have even less of a problem selling them later than you would with bars.
People already use coins to purchase things. Everybody knows what coins are and what can be done with them. So if there is ever a major catastrophe, coins would naturally be used to barter with before bars would.
If the government ever decides to ban ownership of Gold, there will a good chance there will be a loophole which would allow for people to own coins. Especially rare or old coins. Coins are minted by governments and are legal tender. So they have less of a chance of being banned later.
Coins have the potential to be graded and certified. When this is done, they are encapsulated inside a sturdy container which shows the coin information. When this is done, the coin increases in value and becomes a better investment. Nobody ever grades bars though.
It does well in ANY economic condition.
Gold has historically risen during inflation because it's price tends to rise as the cost of living increases.
Gold has historically done well even during deflation. Take the 'Great Depression' in the US during the 1930's as an example. During that time, the relative purchasing power of Gold soared while other prices sharply dropped.
Gold does well even when other investments do poorly. For example, during the past 50 years at times when the US stock market plunged, Gold soared higher.
Everybody knows what Gold is and it always maintains purchasing power. Even during a complete economic collapse, Gold can be used to barter with.
We highly recommend Kinesis for this. They are partnered with Allocated Bullion Exchange (ABX). All bullion is stored within fully secured and insured vaults in Dubai, Hong Kong, Istanbul, Vaduz, London, New York, Singapore, Sydney, Toronto, Zurich, Panama City, Batam and Brisbane. All Gold is fully redeemable, segregated, and Independently audited. Kinesis offers FREE overseas Gold storage!
BullionVault is another good choice. Although it is not free. You would be able to choose the location of your overseas vault. Or you could even store your Gold in multiple vaults. There are daily audits and the results are published daily right on their website. The vaults are secure and insurance is included. All Gold is real and fully allocated!