- May 3, 2013
- Posted by: John Fischer
- Category: Accredited Investors
According to CNBC’s All-America Economic Survey investing in gold is a top pick of many Americans. According to the survey investing in gold was the top pick for 35% of respondents, over real estate at 27% and stocks at 21%. This is in spite of the fact that the Dow Jones Industrial Average and the Standard & Poor’s 500 Index are back on track and hitting record highs.
Those polled are still unsure about investing in the stock market and view gold as a safer alternative. Of those that responded 21% said they were sure it was a good time to invest in the stock market. This is however an increase from the previous year at 9%.
There are many reasons that people like to invest in gold. One of them being that it is a commodity, something you can touch and hold. People have used gold as currency for thousands of years and with economic uncertainty people tend to cling to things they are sure of – gold being one of them. The reason the cost of gold continues to go up is that the demand isn’t going down. Gold is still used in jewelry, electronic devices, piping, and more. As precious metals are used in new electronic devices the demand will continue to rise.
Gold is a long term investment. It is something that you purchase and hold on to, selling after years of accumulation. Many people are investing in gold to use during their retirement. The gains may not be astronomical but they are steady and can help to balance some of the risk from other investments. Many people view gold as “safe money”. It is safe because it doesn’t depend on a particular currency or economic conditions. It will hold steady, at least traditionally.
Those that invest in gold should also consider allocating a portion of their portfolio into other investments. Whether investing in the stock market, private placement memorandums, crowdfunding, or as an angel investor – include some higher risk/higher payout investments in your portfolio. Use gold as a way to even out your investment portfolio and act as safety net. Investing in gold alone is typically not a sound strategy for retirement planning. As with any portfolio, a gold only retirement plan may not deliver the results you are looking for. A seasoned financial adviser can help you to decide how much money to allocate towards specific investment categories. In the meantime go buy some gold and enjoy wearing your investment. It’s a lot more fun than carrying around a stock certificate.