Investment entails acquiring assets with the hope of them appreciating in value and giving you a profit later on. There are many investment options you can make, from trading stocks to real estate to mutual funds. These tend to be the most common ones, yet they aren’t the only ones.
One other investment that investors adopt is gold. Gold is highly-valued, hence the reason it’s a form of investment.
Are you an investor looking to invest in gold? It’s a commendable option, but there are a few things to know about it. This post sheds light on this by highlighting its dos and don’ts. Read on to find out more.
Related Read: How Much a Brick of Gold Cost?
Successful investors have followed a number of tried and true steps to get where they’re now. Want to be like them? Check out the tips below.
Gold’s high value has resulted in counterfeits. Please don’t fall victim to buying counterfeit gold by buying from a reputable gold dealer.
Suppose you want to buy gold coins. Search for specific dealers known to sell your preferred gold, be it Mexican gold coins, or any other country’s coins. Proceed to check the reputation of the dealers that appear on your list.
You can find out about a dealer’s reputation through reviews online. Reviews are left as feedback from previous and current clients. You want to know what they have to say about the dealer. Place your focus on the legitimacy of the gold they bought from them. If there are any complaints, refrain from buying from this dealer.
It’d also help not to buy from a seller with no physical store. You want to verify that they have the gold before making the payment. It’s something you can only confirm by visiting their physical shop.
Lastly, before making your purchase, ask as many questions as possible regarding the gold. A legitimate seller will answer correctly without any hesitation; they’ll be patient with you. It’s a trait you’re not likely to find with a counterfeiter selling fake gold who’ll want to hasten the process and get your money immediately.
When buying gold, it’s important to verify its legitimacy before paying. There are tricks to doing this.
One, check the markings on your gold bullion. Most gold mining companies will imprint several pieces of information. These are the company’s logo, website, and the gold’s purity and weight. It’s important to verify these details. Ensure the company exists and the weight imprinted is correct. With weight verification, it shouldn’t deviate at all from what’s indicated on the bar.
Two, use a magnet. Gold is non-magnetic; it shouldn’t attract a magnet if it’s pure. Therefore, be sure to visit the vendor with a magnet. Alternatively, ask an expert to verify the gold’s purity for they have the proper tools and skills to carry out the testing.
Acquiring gold is no small feat considering its price tag. That’s why it’d be a nightmare to lose your gold due to theft. Besides the loss, recovering financially will prove challenging, which validates the importance of having insurance coverage.
Insurance works to reinstate you to your previous financial position before the insured risk occurred. With gold insurance, the provider will give you money equivalent to the value of your lost gold.
Gold investors tend to make mistakes with their gold insurance. Suppose they’ve stored their gold at home. They might have a home insurance plan that’s less likely to cover gold. Even if it does, they’ll rarely fully recover financially since it’ll only compensate a given percentage that might not be equivalent to what they paid for the gold.
It’d help to have a floater insurance policy in addition to your home insurance. It covers losses that your home insurance doesn’t cover. A floater policy requires you to take an individual cover for each valuable item. In this case, you’ll add your gold under the policy and will likely get full reimbursement in case of loss.
Moving forward, keep in mind the points below so that you’d know what not to do when buying gold as an investment:
The price of gold tends to be volatile, just like the stocks. It means the price today might change tomorrow or even within the day. You need to close your transaction the soonest when buying gold.
Consider the following: you decide to invest in gold because the prices might’ve been attractive. But should you delay taking the next step of buying the gold, you might find that the prices have already increased. Alas, you’ll end up paying more.
One of the secrets to succeeding in investing is diversifying. It entails having more than one type of investment in a given portfolio. Should any of them fail, you won’t experience a total loss for you’ve got others to fall back on.
Diversification is an approach you should adopt with your gold investment. Mix up multiple forms of investments: gold Exchange Traded Funds (ETFs,) gold IRA (Individual Retirement Account,) and physical gold like gold coins, bars, and jewelry.
Gold is a lucrative investment to hold. It tends to stand the test of time and gold can highly benefit you during a recession. Nonetheless, you can only reap these benefits if you invest smartly. The discussion above has listed down some of the dos and don’ts of buying gold. Keep them in mind when buying gold as an investment.