Long-term investors are constantly looking for safe ways to invest, considering the high inflation rates, high stock prices, and high taxation. According to experts, gold is one of such investments and offers an effective way to hedge over the different economic challenges.
Unlike other stock exchanges, gold has proven its ability to hold its price over the most prolonged period. Similarly, economic downturns like inflation, political instability, currency fluctuations, and war affect it the least.
Thus, it’s one of the safest ways to diversify your portfolio or secure your investment from economic downturns.
Here are the best three ways to buy gold in 2022.
1. Buy Physical Gold
Gold coins, bars, and jewels are the most common type of investment in this line. Here are the best ways to buy and own physical gold.
Gold bars, also known as bullion, are the most famous option for investors considering buying gold. While buying gold bars, be sure to confirm the purity of your bars, as it’s crucial.
The purity shouldn’t be 99.5% pure gold if you plan on storing the bars on gold IRA. That’s because IRA doesn’t hold gold with a lower purity level.
You can buy gold bars via individuals or dealers. Online websites like the Birch Gold Group are also an effective option for buying gold bars. However, be ready to part with some shipping fees and insurance costs.
This comprehensive review of the Birch Gold Group from the RareMetalBlog will help you understand their services better.
Gold coins like the American Eagle are common collector items. To buy gold coins, you’ll require to pay a premium corresponding to the value you would if the gold was in a bar form. But, the gold content present in coins is much lower than that of bars.
For instance, a one-ounce American Eagle coin only contains 91.6% of gold, with the rest of the content being copper and silver.
You can purchase the coins through a trustworthy individual or consider pawnshops, online sellers, or dealers. Whether buying online or in-person, watch out for forgeries and fraud.
Another great way of owning physical gold is by the purchase of jewelry. Most antique pieces have higher gold content and offer a better platform for buying gold. But, like gold coins, you’ll have to pay 20% to 300% premiums, depending on your jewelry’s manufacturer.
Similarly, not all glittery jewelry you find around is pure gold. Many manufacturers alloy their items with other metals to make them shinier or more durable.
Also, watch out for counterfeiters. Ensure that your dealer is a member of the Jewelers of America and has signed the professional code of conduct.
2. Invest in Stock of Gold Mines
Apart from buying the actual gold, you can invest in companies that mine, refine, and sell this precious metal. This method is more straightforward and doesn’t require much market knowledge.
However, stock shares of the gold companies may sometimes compare to the actual gold prices but relate more to the company’s existing expenses and profitability. As a result, gold stocks have a similar risk as any other stock market.
Barrick Gold (GOLD) is one of the best stock markets to consider.
3. Consider Gold Mutual Funds and EFTs
Investing in gold mutual funds and exchange-traded funds (EFTs) is a great way to gain exposure to the gold’s long-term stability while attaining higher liquidity than physical gold. Similarly, it offers you more diversification than investing in gold stocks.
This method entails investing in a pool of gold-related securities via EFTs or mutual funds. Some of the most common EFTs and gold mutual funds include Franklin Gold and Precious Metals Fund (FKRCX) and Invesco DB Gold Fund (DGL)
Buy Gold Safely and Effectively
Gold investment, like any other significant market, has several risks, and the chances of fraud are wide. Thus, ensure you understand the process and carefully research the market to avoid forgery when you buy gold.
Keep checking this website for more investment tips and guides on how to buy gold and other precious metals.