If you are interesting in investing in precious metals, you might simply consult with a trusted broker. This company can provide you with proven products and professional advice. Before you contact a broker, it might be important to understand why you are interested in this market in the first place. Distinguish between precious metals investing and savings first. While the purchase of gold, silver, platinum, and palladium might allow you to do both, it is important to understand the difference.
Saving: This usually refers to setting aside some extra income for an emergency. Remember how your parents always told you to save for a rainy day? Everybody should have three to six months’ worth of savings set aside in case of a job loss, illness or other financial issue. If you are saving for retirement, you will want several years’ worth of living expenses stashed away. Making a profit is not the primary goal, but retaining the value of your savings is an issue.
Investing: This implies putting money into an asset that will appreciate in value. Investments are more than savings because they provide a way to get your money to actually work to make more money. Your asset should generally appreciate over the long-term, but it may not increase in value every day, every week or even every month.
Precious Metals as a Savings and Investment Tool
How do you know if you are buying precious metals to invest or save? In an ideal situation, you can accomplish both things at the same time. You can use your extra money to purchase an asset with a value that appreciates. This concept is simplest to illustrate if you compare the value of gold and dollars. Dollars are a measure of U.S. currency. Gold is the most commonly discussed precious metal.
• The spot price for an ounce of gold was about $250 in September of 1999 according to Kitco.com historical data.
• The spot price for an ounce of gold on August 1, 2013 was about $1,310 according to that same data.
• The US Census tells you that the average sales price of a US home was $193,000 in 1999 and is about $294,000 today.
Make things simple. This is actually helping the case for the US dollar but say that gold has gone up $1,000 over the last 14 years. Meanwhile, the average sales price of a home has risen $100,000. It would have taken 779 ounces of gold to purchase the average house in 1999. It would only take 226 ounces of gold to purchase the average new home this year.
It should be clear that it would have been a great idea to purchase gold fourteen years ago. It would have been a great investment and way to save. The value of gold not only held its actual buying power, it kicked the proverbial donkey!
This is true even though the price of this precious metal dropped back from its all-time high. If you held onto gold past that high, you should not be kicking yourself for not selling when it peaked. You should be patting yourself on the back for buying it when you did.
What Are Precious Metals Good For?
It is true that gold does not have as many essential industrial uses as some other precious metals. That does not mean that it does not have any. This does not really break the case for precious metals investing, but simply strengthens the case to consider some of the other metals.
Of course, all precious metals are used to make jewelry and even bullion coins. Silver is used in photography and sophisticated electronic components because of its ability to conduct electricity and heat. The automotive industry generates about half the demand for platinum. Because it is almost completely resistant to corrosion, palladium goes into many electronic components too. These precious metals all have a high demand generated because of both an intrinsic and extrinsic value, but they are all usually measured against gold.
What Kind Of Precious Metals Can You Buy?
You should also understand the difference between buying bullion and collectible coins. Collecting coins with a humanistic value can be a great hobby. Some collectors even make some money. However, this rare coin market is very volatile and not really based upon the actual value of the gold, silver, platinum, or palladium that the coin is made out of.
Most bullion brokerages deal in bars, rounds, and even coins that are mostly valued for their precious metal content. These types of products are what can be tracked against the actual value of different currencies and different physical assets. Dealing in rare coins is more art and speculation than science.
That said, many major countries do produce their own modern coinage out of precious metals. These are easy to spot and certify. They can be a very good physical asset to purchase. They are considered bullion coins, and they are not considered rare coins.
What Is The Outlook For Precious Metal Investing?
Nothing is more certain than uncertainty in these chaotic times. Everybody thought that the dollar, interest rates, property values and the stock market would keep booming a few years ago. Gold bugs certainly came out on the winning end of that episode.
Nobody can really tell you what the value of a stock, house, or currency will be like in a few years. Nobody can even say exactly how much an ounce of gold or silver will be within a decade. But there are some things you can predict with certainly.
Precious metals have held their actual buying power through the centuries. This cannot always be measured in dollars, yen, or Euros. It can be measured in the amount of bullion it takes to purchase a house, a car or a loaf of bread. When some currencies have dropped to nothing, gold and other types of bullion have retained their value.
Precious metals have also always been considered a safe-haven investment during uncertain times. This is true during wars, natural disasters or even simple economic uncertainty. This was true from ancient history right up to the present.
Precious metals might offer fantastic returns. As illustrated, an ounce of gold purchased a decade ago would be considered a great value today. Nobody can assure you that the price of gold will rise up that dramatically again. Many experts believe investors can expect further gains though.
But at the very least, this physical asset will hold its value unlike many types of “paper” assets. Since these are actual physical assets, you might liken them to a small and valuable piece of real estate that you can carry around in your pocket if you choose to.
How Can You Save Precious Metals For The Future?
Are you ready to purchase gold, silver or other precious metals? If so, you have several options.
• You can take delivery of your bullion and store it yourself.
• You can set up a storage account. You retain title to your assets and can request delivery at any time. A reliable broker handles secure storage for you.
• You can even invest in precious metals as part of your individual retirement account (IRA). Most people who choose this option will also set up a storage account. Upon retirement, you are free to sell your bullion back to the brokerage or take delivery.
You might pay for your purchase with a credit card or check. Some large brokerages can even arrange financing as long as you put up a down payment. You can usually pay by sending you payment in through the mail or even paying online. Purchasing and selecting bullion has never been easier.
Are You Ready To Save And Invest In Precious Metals?
Precious metals can be a great way to invest and save. It is better to hold them for the long-term so you are immune to temporary fluctuations, but they are easy to sell if you do experience a financial problem. Reliable brokers can make this transaction simple and ultimately profitable. Why not find out more about buying precious metals today?
http://www.census.gov/const/uspricemon.pdf – home price