Do you have to be rich to buy gold? No, but you shouldn’t mind becoming one. Buying gold is for everyone, from students to housewives; However, caution is advised! Read carefully, because with a little knowledge, buying gold turns out to be a very fun and financially beneficial activity. First things first, what exactly is gold?
King of metals
Gold is not only a valuable metal, it also has a mysterious appeal to most people, as evidenced by the many important appearances of gold in history. For those who would like to read more historical stories about gold, this site has more than enough; think of Tutankhamun, King Midas, the three Kings, the quest of the Alchemists, King Solomon, gold among the ancient Greeks and the Californian Gold Rush. There are numerous applications in medicine, electrical engineering and space travel.
Why buy gold
If you are aware of the applications of gold, you now understand that the demand for gold will only increase in the future. While the supply will -logically- not increase and even seems to decrease. Anyone looking for a graph of the gold price in recent years will see a very nice upward trend. Moreover, it is a mistake to interpret this increase as absolute; it is not just the value of gold that is rising, it is mainly the value of money that is falling! While several payment systems have not stood the test of time, gold has been an excellent means of payment for thousands of years. Gold is known for its value retention and is therefore a solution in these turbulent times. The extreme inflation in Zimbabwe, for example, led to people no longer accepting their own currency there, only gold and silver. Money can be printed, gold cannot. Recently, the Chinese government advised its citizens to save gold as they foresee where the dollar could go. Since our euro does not have much history, we can also question the attributed strength of our currency. If the monetary system were to collapse (unlikely) we would fall back on gold and silver. Central banks in Brazil, China and Russia, for example, have been increasing their gold reserves in recent years, thereby strengthening their financial position compared to the West.
Physical and cashless gold
Gold has been exempt from VAT in the Netherlands for several years, but there are still some differences between purchasing cashless and physical gold that you should consider. First of all, to avoid common mistakes, gold mine stocks are not equal to gold stocks! Several intelligent analysts will advise you against buying physical gold… They would rather cheat you out of the money you convert into gold with the craziest investment constructions! Investing in gold overnight is possible at established banks in the Netherlands. However, the small print states that the bank can lend out the gold, so the real power of investing in gold will still pass you by if they fall into a crisis again. You can buy physical gold in two ways. You buy the gold and have it for safekeeping yourself, or you buy gold and have the seller place it in a safe (which you also pay for, of course). Whether you want to buy physical gold in a vault or actually hold it, in both cases I recommend that you compare prices and pay close attention to the reliability of the provider in question. What you will soon discover is that prices can vary considerably and that the price of the gold offered is sometimes above the exchange rate. What you should not forget is that most providers charge a large amount on top. Many banks and other providers offer so-called ‘unallocated’ gold at a very attractive price. Apart from the fact that if you want to physically receive this gold you still have to pay extra, the major stumbling block is the true nature of this gold. Let’s just be clear, unallocated gold is tradable gold, but it doesn’t even have to physically exist! If a provider or bank collapses, you are absolutely no longer sure of your converted capital. The physical gold that the bank does own goes to the creditors and investors in ‘unallocated’ gold are left empty-handed. Buying this form of gold is a great financial move, but not in these times! A safer move is therefore to buy ‘allocated’ gold. From a reliable supplier, you buy gold that has already been produced and delivered, the price is very good, but of course does not correspond to the romantic price that you often encounter (‘unallocated’).
As with most things, you can now also do well via the internet. If you are looking for a reliable supplier for physical gold, you have several options.