Obviously, you may be wondering why gold is so important or precious and what all this noise is really about. Well, the brain behind my article is that I don’t want you to ignore your future and financial/investment/retirement planning. You should not continue going out in the dark in terms of gold and precious metals, so I present you infallible reasons why gold should be part of your investment combo.
1. Diversification of assets. When thinking about investment vehicles, an old adage “don’t put all your eggs in one basket” often comes to mind. Although some reviewers say to put all your eggs in one basket and take care of it, good luck to them. Reasonable and savvy investors should ensure that at least 5% of their investment portfolio is gold and precious metals.
2. Continuous existence of gold. The fact is that gold is long past the human age and as long as the world remains, gold will be in perpetuity. Gold is superior to other properties, products, or investments (buildings, vehicles, stocks, bonds, etc.) because the value of these properties can erode over time and prevailing economic events. Take, for example, the 2008 global stock market saga; You must also incur maintenance costs to keep them in good repair.
Gold, on the other hand, its value does not erode or oxidize regardless of the number of years that we are considering.
3. Shortage of gold. The gold supply is finite. The statistics revealed that the annual world gold production is about 2,500 tons and the value of gold worldwide is estimated at 9 trillion US dollars. It is better that you buy gold now rather than regret it in later years.
4. Status symbol. To put it bluntly, gold is very attractive to the eye and has a powerful impact on nature/human race. In fact, China and India are well known for the high value they place on gold as their store of wealth, so your wealth is expressed by the quantity and quality of gold you owned.
It is built into human nature to want to belong to the highest political/social/investor class, so the value of the gold you owned in any society will dictate whether you belong to this ostentatious class of elites.
5. Counterparty risks. Gold is absolutely excluded from counterparty risk. Such a term means that you are placing your faith in the other party’s ability to perform a deal/contract on the expiration date. Examples of stock purchase, entrepreneurs and employees will explain it better.
You buy stocks from the capital market in anticipation of dividends, price appreciation, and cash in the year ahead. The stock market may crash before your target date or in the case of an employee working for an employer, the employer is expected to pay the tip and pension at retirement, but the employer may go under before The retirement. All of these scenarios cannot happen to gold because it is tangible, it is in your possession, and you can easily convert it into cash to upgrade your lots.
6. Substitute insurance policy. The purpose of the insurance policy is to put you in the exact financial position you enjoyed before the loss. Gold can also play the same role if you have the same. In times of national crises (wars) like the one experienced in Africa – Liberia and Ruwanda, 1kg of gold can restore a person to a life of convenience again.
7. Bull market (gold). When you read any guidance or advisory on commodities or securities, the disclaimer is usually at the beginning of the advisory and the summary is that “past performance is no guarantee of future results.” Therefore, gold is exempt from this standard and since the beginning of the new millennium; gold has been on the rise with double-digit gains.
8. Anchor against deflation. Of course, an open secret that the economic downturn is now a global phenomenon, the ever-increasing debts of nations (the US and the UK, for example) could potentially result in deflation with catastrophic economic impacts. The consequence is that the value of assets will erode, but gold has resilience and works better to maintain its value regardless of economic challenges.
9. Geopolitical risks. Wars, terrorism (USA – unforgettable 9/11), natural disasters and other allied dangers characterize today’s global society. At the time of war, for example, the safety and survival of the individual is the main concern, there will surely be paralysis and economic recessions. The main assets; real estate, financial instruments, other property, and cash currency will be nearly worthless in value. During that time, gold provides peace of mind and the value remains constant.
10. Store of value. Historically, gold is thousands of years old with supporting records as the best store of value. Regardless of economic and global situations (technological changes, trends, development, etc.), gold possessed the characteristic of acceptability and constancy of value. Therefore, for the security of your investment, retirement and to pass your assets to the next generation, gold is your best bet.
11. Gold backs money. History tells us that the first gold coins were minted and put into circulation around the year 550 BC; Gold has been the longest and most enduring form of money. Inherently, until the sun rises tomorrow, gold is still a way to back money.
In view of these green lights, one stitch in time saves nine. Click the link below to start your gold or 401K investment.