#1) All paper currencies fail sooner or later.
#2) Central banks & Billionaires have been investing in Gold.
#3) Gold does well in both inflation & deflation.
#4) Gold does well in times of complete economic collapse.
#5) Gold has withstood the test of time by being used for thousands of years.
#6) People flock to Gold in times of geopolitical uncertainty (eg. Brexit).
#7) There is a limited supply of Gold which cannot be increased like paper money can.
#8) Supply of Gold is falling due to falling mining production and is projected to continue falling.
#9) New Gold discoveries have been falling and are projected to continue falling.
#10) Gold is durable unlike paper money which can be ripped or burned.
#11) Gold is extremely portable. A whole suitcase of money would be needed to buy what a little piece of Gold can.
#12) Gold is a great way to diversify a portfolio.
#13) Physical Gold cannot be hacked.
#14) Gold is not subject to capital control restrictions (eg. Greece, Cyprus)
#15) Gold is extremely liquid. That is, there are always buyers to sell your Gold to.
#16) Owning Gold can be private and confidential.
There are many reasons, but there are 3 very important reasons why:
#1) All paper currencies always fail. There has never been a paper currency that has never failed. To the contrary, Gold has never failed and has been a consistent store of value throughout history.
#2) Countries and governments are buying Gold like crazy.
#3) Billionaires are buying Gold. There is a reason Billionaires are Billionaires and that is because they know how to invest. They are investing for their future 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:
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 near spot price for your Gold.
Local pawn shops
Local classified ads (eg. Craigslist)
Local precious metals dealers & coin collecting shops
Online auctions (eg. Ebay, Ebid)
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 the most recommended method. Some examples are Delaware Depository and Transcontinental Depository Services. You could even get an overseas vault of your choice if buying your Gold online through BullionVault. Their vaults are audited daily, are anonymous, have low fees, and come with free insurance.
Home safe - A dual combination/key safe 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 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.
It is recommended you 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 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 recommened BullionVault for this. 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!
No. The process you are referring to is usually called a "rollover" or "transfer". With this process, you will not incur any tax penalties.
First, this is a great step in protecting your future! Secondly, depending on the type of IRA, there could be tax advantages (eg. tax-deferred or tax-free growth).
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.
Here are the Stock ticker symbols which US investors may want to consider:
The NAK Stock was added in early 2017 because it has been identified as a stock with a serious upside potential.
Below are several reasons to consider Northern Dynasty Minerals (NAK):