Real estate, gold investing, and precious metals have traditionally been the wealthy’s secret to protecting their wealth and purchasing power against the ravages of inflation.
Today, gold bullion prices are at a bargain, while real estate prices are near their previous highs. Making gold purchases advantageous. Buy it when it’s on sale.
Let’s take a look at real estate for a moment just in case you’re considering it as an investment.
The problem with real estate, especially today, is that the barrier to entry is so high that most mere mortals are priced out of the market.
It used to be that twenty-something-year-olds would get married, buy a house, a car, and start a family soon after graduating college. These were the bread and butter home buyers, young families.
But it’s not the case anymore. Millennials are holding off on marriage, and thereby delaying (indefinitely) the purchase of their first starter home.
What this means is– there is an entire army of intelligent “investors” with large disposable incomes seeking safe long-term investments. They were, in the past, looking to real estate, their first home, as this shelter.
There is a high likelihood that at least some (if not much more) of this money will spillover into the precious metals industry.
Here’s a quote from Gallup/U.S. Census Bureau:
“For millennials currently aged 18 to 30, just 20% are married, compared with nearly 60% of 18- to 30-year-olds in 1962, according to the U.S. Census”
Now May Be Time to Consider an Investment in GOLD Bullion
Gold has similar characteristics to real estate.
- It has a finite supply, which is why it’s a precious metals.
- It’s in demand by both consumers and industry. Consumers use gold and gold jewelry as a store of wealth, which can be traded later or handed down to their heirs.
- In industry, gold (and other precious metals like silver) are necessary in electronics, solar panels, building material like reflective windows, and in medical science.
- Gold is also stable and holds its value no matter what paper money does.
It’s said that a gold coin could buy an ancient Roman a fine set of clothes, leather sandals, and a leather belt. Today, a gold coin like the American Eagle, can easily buy a top quality business suit, a pair of shoes, and a belt.
What are some of the other characteristics that make Gold a better investment than real estate now and throughout 2017?
1. Size of investment ($$$)
The average cost of a home in California (in 2016) is $469,300 (per Zillow). This fact makes it very difficult to enter the real estate game even if one is interested. Add lengthy escrow times, closing costs, commissions, rehab, holding costs, insurance, taxes, and the paperwork alone could scare any investor off.
Gold, on the other hand, is divisible. You can easily get started with a couple of ounces, or fractions of an ounce (i.e. half-ounce, tenth-ounce), and invest what you have available.
It’s convenient to buy, too. You can easily buy gold coins online.
Gold, and even silver, are almost as liquid as cash. You can quickly turn gold into cash, or barter it and trade it in lieu of cash.
And guess what, if you put your cash under your mattress, it is very likely going to lose value and purchasing power… as it has done since the early 1900s.
Gold, and even silver, have held their value for millennia.
A store of gold and other precious metals can be kept private. Trading for goods and services with gold or silver gives you as much privacy as making those purchases in cash.
Gold coins stored in enough tubes to cover a typical laptop would be worth over $300,000 and weigh less than two gallons of milk.
In an emergency, you could carry this in a backpack, luggage, or your car and get away with a good portion of your wealth to start over somewhere else.
Unlike using diamonds or gems as a store of wealth or as a bartering device, it’s easy to calculate the value of your gold.
Gems are highly subjective. Ask three “experts” the value of a diamond and you’ll get three different opinions. The difference in prices could easily skew thousands or hundreds of thousands of dollars.
But with a gold or even silver coin, you either have one ounce or not. And the coin is either .999 pure, or it’s not. You know the value of your holdings with certainty.
6. Intrinsic Value
Similar to real estate, a gold coin has physical value. Paper money on the other hand can inflate to the value of tissue paper (and has done so hundreds of times through history). Stock certificates aren’t much different. They easily drop to zero.
But gold has intrinsic value. It has physical value that holds true.
There are risks and rewards in all avenues of investing. But the current environment and low gold prices make it a very interesting time to stake your claim in gold and protect your future buying power.