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Investing in gold in personal financial planning

Published: Fri, 06/17/2011 - 14:52
By: admin

Investing in gold is considered the best way to protect your capital from inflation and currency devaluation. Interestingly, the price of gold rising particularly rapidly in periods of instability and crisis. This is due to the fact that gold is seen as a safe-haven asset. In other words, the demand for safe investments in times of crisis is pushing up the price of gold. Experts in financial planning is recommended to keep the gold 10-20% of the capital.


However, gold has one significant drawback. His purchase involves some inconvenience and additional costs. Thus, gold bars and coins must be stored in appropriate conditions. The owner must ensure the safety of their property from the encroachments of unscrupulous people. In addition, ingots and coins, even with minor injuries may lose much in value. What are some easy ways to buy and store gold?


1. Buying bullion bank and deposited them in bank cells - the safest way. In addition, the bank is responsible for the mechanical integrity of the bars (no scratches). The disadvantage of this method - the need to pay for the rental of the cell. In practice, investment in gold bullion and storing them in a cell bank becomes profitable if the following conditions - the purchase of gold for at least a year and the size of the ingot is not less than one hundred grams.


2. Purchase of non-cash gold and storing it in a bank deposit account - eliminating the need for investors to puzzle over the place of storage of bullion. The disadvantage is manifested during the crisis - some banks have started looking for legal tricks to pay the deposit amount is not in gold, and in the national currency with conversion rate. It can not be considered beneficial in the devaluation of money and a rise in price of gold.


3. Buying life insurance policy, denominated in gold. This method of investment in precious metals has become popular in some European countries. The insurance company receives from the client's contributions in the form of cash equal to the value of a certain amount of gold to date. The client receives the payment in the form of gold bullion at the end of the contract. The drawback of investments - long waiting period for a refund.


Despite some inconveniences, gold is an excellent investment vehicle. Separately, we must consider the purchase of jewelry. Of course, if you can buy a necklace that belonged to Queen Victoria, then your purchase may be called an investment. Purchase of ordinary decorations that do not have the artistic and historical value, is not considered a profitable investment. The fact that you can sell ordinary decoration only to be recycled. Accordingly, its price will be low.