Gold Investment Merits and Demerits: Why Gold Is the Safest Investment of All Time

Investment is a way of saving money by investing them in any financial instruments. People around the world invest their savings in various ways which include stocks, bonds, mutual funds, property, precious metals, and many others. Read about gold investment merits and demerits.

Investment helps us to earn good income over time. And if we save our money wisely, then it grows exponentially bigger over time! Many people have lost their hard-earned money due to poor investment decisions; they end up regretting it later. 

So, it’s always advisable to invest smartly to avoid losing money. Among all types of investments, Gold is a safe choice. Let us find out some of the reasons why it is considered a safe investment. 

Acceptance Of Gold Across The Globe

Gold is widely accepted among people for its use as an investment asset. And it has been proved to be a reliable and stable investment option for centuries. In fact, it was the first currency ever used in human history. 

It has the potential to produce profits for years due to its scarcity as well as high demand in the market. Investing in gold comes with fewer risks and higher chances of earning a profit than other investments like stock markets or real estate. Several factors make gold an ideal investment option. Here are some of those reasons:

Physical Asset  

Gold has become a physical asset since it is scarce and not easily influenced by inflation. It does not fluctuate much unlike other assets like land or commodities. People who have invested in Gold feel secure knowing that it cannot be devalued away like paper currencies. 

It holds its value even after the government issues new ones. Hence, it makes it a safer investment option than other assets.

Long-Term Growth Potential  

Its price increases gradually over time instead of sudden fluctuations. Thus, it has a long-term growth potential compared to other assets. Unlike other assets, it is not affected by economic slowdown or recession. All these factors ensure that Gold is considered a safe asset for investors.

Fewer Risks  

As mentioned above, Gold does not fluctuate much making it a viable investment option. Moreover, it is resistant to deflation and inflation. While other assets may lose value due to inflation, it remains unaffected. 

Also, it does not attract speculation. Instead, it attracts buyers from different parts of the world. Therefore, it provides stability and safety to investors.

Universal Acceptance  

Gold is widely accepted among people all across the globe. Even though people do not understand it fully, they accept it as a monetary asset. Thus, it becomes easier for people to invest.

Safe-haven Asset  

If something unexpected happens to your country’s economy, it might cause instability and insecurity. However, Gold is immune to these problems. Investors feel confident knowing that they can sell off their holdings in Gold at any time without facing any losses. 

Global Reach  

Gold has gained popularity all over the world. It has achieved international status and is traded in almost every country in the world. As it is a global commodity, it has a wider reach and appeal than other national assets.

So, investing in Gold can be a great idea for both beginners and experts. And if you haven’t started yet, now would be the right time to get started. 

Nowadays, there are several online platforms where you can buy gold coins and bars. You just need to go through websites and select the best offers. One thing is sure - investing in Gold is highly profitable and rewarding.

Ways To Invest In Gold

A lot of people have heard of investing in gold as a way to protect themselves from inflation and deflation. However, not many know about investing in physical gold and silver coins. Gold bullion investments provide high yields and stable returns, whereas owning paper money doesn’t offer any stability. 

Gold coins have been around for over 2000 years and are seen as a safe haven asset if inflation becomes rampant. The price of gold will fluctuate based on supply and demand, but it is still considered a valuable investment. There are several ways to invest in physical gold coins and I describe them below.

Buying Gold Coins Online

It is possible to buy physical gold coins online. You can find out where you can purchase gold coins on eBay, Amazon, and Craigslist. There are buyers on these sites who specialize in purchasing gold coins at low prices. 

All you need to do is contact one of these sellers via email or phone. Be sure to ask questions regarding the seller's experience and what their return policy is before parting with any money. When buying gold, make sure the seller provides you with a tracking number. If they don't, then move on to the next seller.

Gold Bullion Banks

Gold banks are another option for investors that want to own physical gold without having to deal directly with someone else. These places allow you to store your coins for free, just like a regular bank account would. 

Gold banks are insured by FDIC and you are protected from theft and fire. Their fees are lower than those charged by individuals selling gold coins online. One downside to using gold banks is that you can only sell gold to another bank, so remember to pick your bank wisely.

Gold Mining Companies

Some people believe that mining companies are safer than storing gold in a bank. They claim that even though some banks fail, no company has ever failed. Many gold mining companies send their profits to tax havens overseas, which may pose a problem for those looking to acquire gold legally. 

Look for companies that are registered in the US. If you decide to buy shares in a mining company, make sure you understand how much risk you are taking. Make sure that the company you invested in is legal and fully licensed.

Gold Exchange Traded Funds (ETF)

An ETF is similar to a mutual fund except instead of owning stocks or bonds, it owns shares of actual companies that produce gold. If you choose to use an ETF to invest in gold, you don't really own the gold. 

The gold is owned by someone else. An advantage of ETFs is that they give you exposure to a wide variety of companies. Another benefit is that they require less paperwork since it is traded electronically rather than physically.

Gold Mining Stocks

Investing in mining companies is another good way to get involved in the gold market. A mining stock is basically a share of ownership in a specific mining company. The investor gets paid a dividend each year based on how much gold was produced. Investors can find mining stocks listed on major exchanges like the New York Stock Exchange (NYSE). 

Before buying mining stocks, conduct research and learn how to identify fraudulent companies. The SEC does not regulate mining stocks; however, they do regularly publish information regarding fraud and manipulation.

Gold Bars

These are the gold investment merits and demerits. Physical gold bars are great for storing gold securely. Unlike trading stocks, you cannot lose money investing in gold bars. Once the bar is delivered, you can take possession of it and start enjoying its value. Physical gold bars are easily recognizable thanks to their size and weight. Don't forget to check the purity of your gold bars before spending money on them.

Written By: Aniket Dubey