investment in gold

Why is it a Wise Idea to Invest in Gold?

Generally, the world’s population can be divided into two categories: people who are content with whatever they have, and the ones who are always dreaming of getting ahead. The second group of people is a highly-motivated lot that is always striving to achieve the objective of a better life for themselves and their loved ones.

A wide majority of people spend their lives surviving on the fixed income they receive from their employers. They also manage to save a little amount out of that total monthly income. However, most people have very little idea who they should invest those savings in a constructive way in order to multiply it over time. One such area of investment people don’t pay much attention to is precious metals investing, which provides investors with a brilliant opportunity to grow their wealth over time

There are several investment options available for laymen, including equity holdings, mutual funds and commodities like gold and silver coins. Each one of the above listed investment options has its pros and cons. The below article will discuss why it is wise to invest in gold.

Why is it Wise to Invest in Gold?

Gold has obviously been one of the most important mediums of exchange for many centuries. It is also considered a good luck carrier in many civilizations. Some of the main reasons why gold is the best investment option, are listed below:

1. High Liquidity

When you are making an investment of any kind, the first thing you should look for, is the time it will take to liquidate that investment if the need arises.

Gold is a highly liquid commodity anywhere in the world. If you have an urgent need to liquidate your holding, you can simply sell it off in the market at the prevalent market price. Standard price of gold is offered every day and buyers for this precious commodity are always available. However, you may not get a very good rate of return when you liquidate your gold holdings in a hurry.

investment in gold

2. Inflation Screen

Gold is considered a great shield against inflationary trends in the economy. It has been observed historically that gold prices rarely change during times of inflation. This means that your investment holdings in gold will not suffer a loss when value of other investments will be falling. Gold prices remain relatively stable even during times of global recession.

3. Easy to Acquire, Easier to Dispose

Most of us must have bought – or tried to buy – real estate at some point in our lives. The process is a long one which involves a lot of paperwork and headache. On the contrary, it is easy to invest in gold coins. It does not take a lot of time, and involves no paperwork at all.

When it comes to selling real estate, the paperwork is there too, but you also need to find a prospective buyer and haggle with him / her over price. The actual process starts only after both parties have reached an agreement.

Selling gold is much easier. You don’t need to find a buyer because they are always available. There is no dispute over price because gold has standard price which is shared every day.

The process of buying / selling gold is convenient and tidy one with no space for price maneuvering.

4. Creation and Transfer of Wealth

Gold has been considered a precious matter since antiquity. Possession of gold increases the net worth of an individual. In fact, the precious metal, in many cases, has been passed from one generation to the other in the form of jewelry and heirlooms in order to transfer the wealth belonging to a generation, to the next one.

The Final Word

Significance of gold as an investment option cannot be emphasized. There are options available for investors who do not want to invest in physical gold. These people can easily invest in gold-based funds. Gold does not only provide you with a monetary shield against inflation during economic slowdowns, it also allows you to build a lasting family legacy.

Salman Zafar

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