Investing in gold was commonplace for centuries. Before common paper money became the norm, gold was the payment option of choice. In fact, the vast majority of currency was backed by gold for hundreds of years. While this may no longer hold true, people have turned to gold investment options to bolster their investment portfolios. In the last ten years alone, gold has risen from nearly $400 an ounce to over $1800 an ounce at its high in 2011. Now, the rates are holding steady in the $1200 – $1300 range. Those that had the hindsight to invest in gold ten years ago have tripled their investment today.
Benefits of Investing in Gold
There are numerous benefits to investing in gold. Not only is gold a precious metal, but it is a metal that is used for jewelry, electronics and seen in various other applications. Gold investments are beneficial because of the following:
- Protection Against Economical Problems: When the economy took a turn for the worse, the value of gold rose, while the value of most currencies fell.
- Continual Increases: Over the last ten years, the value of gold has continually risen. While the market fluctuates daily, all forecasts point to gold prices rising higher in the future.
- Does Not Count as Income: If gold is purchased today, it will not be counted as income. This means that it will not cause a person any unwanted tax burdens.
- Easily Sold: Gold is in high-demand and turning physical hold into cash can be done on any given day. Whether gold bars are sold or bullions, there is a buyer with cash in hand willing to pay.
- A Solid Asset: Gold will be an asset that is dependable. If inflation rates hurt the dollar, gold will still hold its value.
- Limited: There is a limited quantity of gold on the planet. As demands increase, it will only keep rising in price. For the smart investor, this means that their portfolio grows with the scarcity of gold.
A person that chooses to invest in gold will be able to bolster their investment portfolio with an asset that has held its value for thousands of years. With the history of gold seeing a recurring value increase of 11 percent annually, investing in gold is a long-term endeavor that will yield significant gains for those that own it.
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