Powerful And Revealing Video On How To Look At Investing In Gold With Some Fascinating Points For You To Consider
Was That Not A Bit Astonishing For You To Think About?
I’ve had a sense about the economy for some time now. Back in 2005 or so I knew what was going to happen with real estate, and to me, the market would follow, which it did. I’m not a financial analyst. I’m pretty good with math, and I mixed in some simple logic.
I can’t believe people couldn’t see it, as I tried to point it out to friends who were swallowing mortgages around the quarter million dollar area, and with a sense of what they were making, I knew it wasn’t possible. One that I have in mind worked in the accounting department, go figure.
It seems that there are some dogmas that get instilled inside people, in spite of logic. I was at the time just calculating what a $100,000 mortgage took to pay off for 30 years. I didn’t like the idea since it would mean paying 2 1/2 times the original balance after 30 years at a 5-6% interest rate.
Without going on, I basically calculated the total costs with everything, including bills, average car payments etc. I came to the realization that you need to earn annually in household income what your home is worth, to live comfortably. I’m not here to debate that, but that is what I calculated, and knew people buying houses for 200k weren’t making that.
The other aspect I realized was that salary rates had not increased for ten years or so (teachers were still making 30k and people think 100k is a lot), where mortgages had doubled or tripled along with other things like gas at least doubling. Logic told me that income levels need to double to keep up with a cost of living that has doubled (teachers would need to make 80k and 100k would now be 200k). Not many shared the same sentiment, and I digress.
This brings us to gold. Once again I see something but it’s a far bigger picture, as it involves real estate still, and world currencies, the state of the nation, and there doesn’t seem a way that the situation will improve. Some aspects that we can count on are continued inflation and a shaky stock market that has many people nervous.
In essence, gold historically has performed very well during any one of those single factors. You can look back over historical data to support this. Some are apprehensive seeing how the price has started sliding some, yet there are other factors to take into account than only the price of gold.
You can see what some experts say about gold here in this post .
Here is a very revealing breakdown of gold in contrast with commodities and currencies by an authority in the field that is another real eye opener.
And here is an fantastic breakdown of the economy and some very fascinating historical data that blew my mind. This offers some pretty amazing reasons to think seriously about investing in gold.
I won’t pretend to be a financial expert. I am once again relying on logic, and what my gut tells me. I have researched all of this some, and essentially reported here most of it as I understand it. I think anyone can see a benefit of a gold investment when taking all factors into consideration.
There are a lot of factors involved, though the main one is that it seems things could be bumpy for some time, and gold is one area that has been known to do well during those times. It is also where many very wealthy people and investors have a portion of their investments. Many always do, but particularly times like now. Now let’s go over some basics.
Getting Started Investing In Gold
There are quite a few different ways to invest in gold. There’s times when investing in gold catches on more than others, creating what’s called a ‘bull market’ where the demand increases and generally the price of gold will follow suit. This is a trend an investor can follow in order to buy and sell to make short term returns on their various gold investments.
A popular way to get started investing in gold where the actual price is tracked is gold ETFs. Gold ETFs allow an investment directly tied into the price of gold, and the investor doesn’t need to worry about storage.
These are highly liquid, allowing a fast transaction when the price is at a place where the investor wants to sell off quickly. There are a couple of physical gold backed ETF options for a more direct correlation with the gold price trends.
These are not recommended as an investment for someone who doesn’t understand the stock market. If you are just getting started, bullion is considered the best choice to start your gold investment, as mentioned below.
There are more factors that can affect the price of gold than merely demand, such as supply, and then other slightly more complex factors such as other market sectors, economies etc. These are some areas one will want to learn about if looking at various stock market options for their gold investment.
Another way of investing in gold is with a more long term outlook, as portfolio protection and a hedge against outer influences. When looking into either short term returns, or a long term investment strategy, this should determine the sort of gold investment you opt for. Physical gold is a common long term investment strategy that is suggested by a number of investors.
Perhaps the most accessible physical gold investment would be gold coins, followed by bars which essentially cost more, yet when bought in bulk cost less per ounce. Jewelry is another possibility, yet can be priced quite high for the percentage or purity level of gold contained.
There are a number of classes of gold coins aside what you may think of as ‘regular’ gold coins, such as gold proof sets, collector’s coins and gold bullion. Each has it’s place, and all are reasonable forms of an investment, each preferred by different sorts of individuals, depending on their intention and experience.
There are what you may consider ‘typical’ gold coins which are generally a lower purity of gold, and are priced accordingly. Gold proof sets are typically higher priced, as they have high levels of purity and a collectible element to them, being limited in supply. Gold bullion coins are also essentially high purity and slightly less expensive than proof sets, and are closely valued to the price of gold, and often sold in 1 oz. pieces, making a single coin valued near the gold spot price, and just over as the broker decides along with the spot price.
Collectible coins that are priced on rarity and demand is one other possibility with gold coins, for one with an eye on collecting. The price range of collectible coins is vast, even heading into the millions for a single coin in some cases. In this case it would be recommended to have some knowledge about this, as you clearly want to have a handle on what you have and can expect from a prospective coin, along with your objective in mind.
Then there is the option of gold bars, which are available in different sizes, similar to coins. One thing that is alluring for investors is that they can be slightly less expensive per ounce, which will increase the more you purchase.
These are perhaps the easiest to understand ways for someone looking into investing in gold to get started right away. Bullion has the most direct relationship with the price of gold, which is one element that draws one to invest in gold, and why it is considered one of the best gold investments.
A diversification of gold investments is considered ideal by many, with the emphasis on physical gold. Some investors are happy with that being the extent of their precious metals, with perhaps a hand in silver and other bullion choices, Gold and Silver Eagle Coins being some of the most sought after. Then you can look into ETFs, or perhaps other gold stocks, futures etc. for some diversification if you want to go with some other options. There are also gold accounts available through financial institutions.
Then there is the choice of what you would like to do with your gold physical gold investments. You can either store them at home in a safe, at a financial institution of your choice, or you can look into a gold IRA, where there are certain gold bullion options.
This option is favorable for those who enjoy the tax status of an IRA, and who don’t want to store the gold and have that to worry about. Plus you can select from IRA types such as a Roth or Traditional, and you aren’t limited to physical gold and precious metals, you may add other investments, such as gold stocks and options that aren’t precious metals as well, and you have control over where your investments are placed.