The yellow metal rallied an incredible 7.3% last month to close at $1,983 an ounce, its strongest October since 1978, when it jumped 11.7%. Even gold ETFs are treated this way, since they are backed by physical gold. That higher rate might nudge you toward more tax-efficient vehicles to contain your gold allocation, such as an individual retirement account, IRA, as opposed to your taxable brokerage account. The challenge of investing in assets backed by physical gold is that there is only so much of it above ground around the world. Put it all together, and it only amounts to the length of a swimming pool or a bowling lane, estimates the World Gold Council. Of course there is more risk involved here, so this route is not for the faint of heart.
Sellers will usually mark up the price of physical gold from its current spot price, so be prepared to pay more than the actual value. Some experts also see gold as the ultimate hedge to protect your savings against inflation since it’s held its value for centuries, and recently appreciated to all-time highs. Due to its inverse relationship with paper currency, gold tends to rise in value when the U.S. dollar weakens. So during periods when people experience eroded purchasing power, the precious metal tends to increase in worth. He combines his personal and professional interests in finance and education to help readers increase their financial literacy and make better investment choices. Jordan has worked in digital publishing for 16 years after graduating from Lynn University as a member of both the Kappa Delta Pi International Honor Society and U.S.
How to Invest in Physical Gold
You should keep in mind when buying that prices will always fluctuate, if you buy when it is low and it dips even lower, don’t stress out. You find a company that sells gold for IRAs and then arrange for it to be stored with a custodian. Almost all gold IRAs require your money to be stored at a secure facility instead of at your home. This is partially for security and partially for the fact that you aren’t supposed to sell off your IRA until you retire. For those that want to buy physical gold as an investment, they want to know where to go.
How To Buy Gold
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Gold coins obviously require safekeeping—either a home safe or a bank safe deposit box. In the U.S., the COMEX is the primary exchange for gold futures, and therefore the place where the most-widely quoted gold prices are set.
It doesn’t hurt to go see a financial consultant if you are unsure of how to work gold into your current investment portfolio. They can help you to find a way to diversify your savings with precious metals while not putting too much at risk. Plenty of content on the internet is also available when it comes to investing in gold and other precious metals.