How to invest in gold amid banking troubles

You have many options when it comes to investing in gold.

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The recent collapse of Silicon Valley and Signature Bank caused concern on the state of the banking system. As a result, bank stocks fall sharply and many people worry about how safe their money is in the bank. An investment that is doing well? gold.

Spot gold prices (how much it costs to buy gold now), gold futures prices (which indicate investor confidence in an asset) and gold bullion prices (physical gold) rose last week, making gold particularly attractive to people seeking protect their money.

Gold is a wise investment for many reasons. It is a good hedge against inflation because it tends to retain its value over time despite market fluctuations. It’s also a good way to diversify your portfolio, which minimizes your losses during economic uncertainty. Historically, gold has been considered a safe haven for investors, and in today’s market uncertainty, safety is as important as ever.

Start exploring your gold investment options today by requesting a free gold information kit.

How to invest in gold amid banking troubles

Experts generally recommend putting 5% to 10% of your investments into gold. This allows room in your portfolio for other asset classes, such as stocks and bonds. As for where to invest this amount, you have several choices. Three common ways to invest in gold are:

Gold IRAs

Individual Retirement Accounts (IRAs) are long-term savings plans that offer tax advantages. There are three types of gold IRAs:

  • Traditional gold IRAs are financed with pre-tax dollars. Your contributions are tax-deductible and grow tax-deferred. This means you get tax relief for them now, but you’ll pay tax when you withdraw funds.
  • Roth gold IRAs are financed with after-tax dollars. Your contributions are not tax-deductible, but grow tax-free. So you won’t see an immediate tax benefit, but you also won’t pay taxes when you withdraw funds.
  • Simplified Employee Pension (SEP) gold IRAS are available to small business owners and the self-employed. Like traditional gold IRAs, they are funded with pre-tax dollars and withdrawals are taxed as ordinary income.

Request a free information kit now to learn more about investing in gold IRAs.

Physical gold

Physical gold is more liquid than investments such as stocks and bonds. In other words, it’s easier to exchange cash, which can be important in tough economic times if you’re struggling to stay afloat. You can buy physical gold, known as bullion, in the form of bars or coins. Keep in mind that you must have secure storage to store physical gold, and bullion can require significant space. You will also need to insure physical gold so that your investment is protected in case your gold is stolen.

Gold ETFs or Mutual Funds

Exchange-traded funds (ETFs) and mutual funds are pooled investment funds that provide easy access to the gold market. There is no need to research individual gold mining companies to invest in; the fund manager does the work for you. In general, ETFs are a better choice if you’re looking for tax advantages, hands-on control over your investments, and niche exposure. Mutual funds are generally better if you want to make regular investments and prefer passive management and lower risk.

The bottom row

Which type of gold investment you choose depends on your personal preferences. But there’s one thing that’s true regardless of your choice: In a financial environment as volatile as today’s, investments like gold are a smart way to protect your financial future.

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