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At the start of 2024, many Americans were optimistic that inflation was steadily cooling and that relief would soon be on the horizon. Unfortunately, this was not the case in the first quarter of the year, as inflation reports in January, February and March disappointing for many. Now that inflation has increased over the past two months, many are wondering whether reducing interest rates will come at all this year. But what should investors do amid this uncertainty?
Many have turned to gold. Investing in the precious metal took a hit 11-year peak last September. Because of portfolio diversification it can also offer the traditional hedging against inflation can act as, it is understandable why many have turned to gold. And on the price of the yellow metal has grown, breaching multitude records over the past few weeks.
To make the most of a potential gold investment now, however, investors must take certain steps. Below, we’ll break down three smart gold investment moves to make when inflation is on the rise.
Start exploring your gold investment options online here now.
3 Smart Gold Investing Moves to Make as Inflation Rises
Here are three moves investors should consider making today, when inflation is still problematic.
First steps
You can’t reap the benefits of gold without investing first, so don’t hesitate to start now. The price of gold has risen by hundreds of dollars in the past month and is currently at $2,332.18 an ounce. So if you wait much longer, the price may become prohibitive and you may end up getting your price cut. Plus, with inflation as high as it has been, it makes sense to add a timely benefit to your portfolio now to offset the corrosive effects inflation may have had on some of your other assets.
Start by researching your best gold options online.
Find out what gold can (and can’t) do
In order to reap the benefits of any investment, it is vital to understand what it can and cannot do. This is especially true for alternative assets such as gold. Although gold can be an effective hedge against inflation, maintaining its value when inflation erodes the purchasing power of your money — and can diversify a portfolio that otherwise consists of stocks and bonds — it is not traditionally an income-bearing investment. So don’t invest expecting a quick profit. While in theory this could happen now with price volatility, it is not something investors should consider a feature of their gold investment.
Don’t over invest
While gold is a smart investment right now, investors should understand that there is a limit to how much they can benefit from the precious metal. Many experts advise limiting investment in gold to 10% or less of your total portfolio, thereby allowing other assets such as stocks and bonds to grow as needed. However, the range between 1% and 10% of your portfolio will depend on your specific investor profile and your long-term goals. Just be careful not to invest too much, as the benefits of gold can overshadow other income-producing assets.
The bottom row
With inflation on the rise again and investors looking for some additional ways to grow and protect their money, many may want to turn to gold now. It makes sense to get started quickly as the price goes up and your portfolio may be more negatively affected by inflation anyway. Just make sure you understand gold’s ability to bring income and don’t be tempted to invest too much. But by making these three smart moves today, investors will improve their chances of success in gold, both now and in the months to come.
