In India, gold is deeply ingrained in our cultural fabric, it remains a popular choice of youth as well as the people at retirement age for safeguarding wealth and building assets. Demand is so significant that it is also clearly visible in a recent report by the World Gold Council revealing India as the world’s largest gold consumer, accounting for nearly 25% of demand.
Let’s take your own example, if you ask your Mother to sell all gold to invest in the stock market then 9 Out of 10 times, the chances are you would end up hearing straight-up NO!
But vis-a-versa, if you were to ask if should invest in gold redeeming your other investment or cash then you would be appreciated as the most intelligent grown-up child in your family.
With such interest, there are many options for you when it comes to gold as an investment & for the same we’ve prepared this guide for you to navigate the complex gold investment landscape. We understand that you might be concerned about putting the amount from your hard-earned money but not anymore!
This guide aims to demystify various gold investment options, concentrating specifically on purchasing physical gold offline and gold coins/bars online for investment.
Understanding the Benefits of Gold Investment:
Hedge against inflation: Gone are the days of paper assets whose value may deteriorate or depreciate over time, gold is your stable investment that will only appreciate over a longer time horizon against the rising inflationary environment.
Safe haven: Gold has a track record of appreciating its own value in times of market volatility & economic turbulences due to geopolitical tensions or global market downturns. This is mainly because in these times, people tend to have a tangible investment feeling that if everything goes wrong, gold is still in their hands.
Liquidity: From ancient times, gold has been considered as the only real currency & it’s true. Every paper currency is issued based on the amount of gold the country possesses. This is the reason why gold is recognized and accepted globally, enabling you to encash/fulfil your requirements.
Diversification: Even the most seasoned investors believe that diversification with gold is the key to building a strong investment portfolio, eliminating the risks created by one single investment.
Benefits Of Investing in Physical Gold (Offline)
Physical Location: When it comes to higher ticket size purchases, you may prefer visiting a store to ensure that you always know whom to ask the doubts and whether or not to trust the brand. Don’t worry, This is very common and it is because of human psychology, that you tend to trust more faces than anything else.
High liquidity: Small quantities like 1g to 10g of gold coins/bars are readily bought back quickly provided that it’s tempered packed and is of a recognized brand by Jewellers.
Portability: Easy storage and transportation allowed by its compact size offer greater flexibility in managing your holdings in gold.
Tangible ownership: Unlike other investments like stocks, bonds or real estate, gold coins/bars are in your hands providing you with a sense of complete security.
Important Precautions:
Verify purity: Always have your eyes on the certifications like BIS Hallmark, ISO or Assay signature, etc verifying the purity and authenticity of your gold purchase. Additionally, you could look for
Compare prices: Window shopping can be a great thing especially when it comes to buying something for your future. Many sellers sell you at a premium because there might be many mediators in the chain where they receive their gold. You should look for gold manufacturers who sell you directly like GGC which offers your wholesale prices.
Vendor reputation: This is very critical since established players in the gold market care a lot about their reputation versus the newer players which have nothing to lose in the name of reputation.
Benefits of Buying Gold Coins and Bars Online:
Competitive Prices: Online platforms that have lower overhead costs as compared to the physical store so they often offer you attractive rates enabling you to invest a higher investment in grams.
Wider selection: The savings you have every month will not be necessarily the same as the price of the ten tola bar you always want but when it comes to online platforms, you always have a wide range starting with just a few grams.
Convenience: You can choose when you want your gold and they will provide you with insured delivery at your doorstep, this is especially helpful when you’re away from your hometown but want to buy from the store you always trusted.
Transparency: Detailed specific information about pricing at transparent live rates is something you should look for before opting for the platform.
Essential Precautions:
Platform security: Ensure the platform security by looking at the payment gateways and cross-checking that all government compliance are followed.
Delivery insurance: The gold you order should have delivery insurance covering anything that can potentially cause damage to your gold while it’s in the transportation process.
Vendor reputation: Just like the offline stores, Online platform reputation is equally important & you may check this by looking at the customer reviews on services/products.
Conclusion:
Whether you choose the affordability of physical gold or the convenience of online purchases, remember that you have to consider your financial situation first. Some financial reserve or insurance for emergencies is always recommended before you start investing.
For example, if your goal is retirement then theoretically you should invest 25,000 per month to achieve retirement but practically if you first invest in levelling up your skills to ultimately reach an income of Rs.50,000 monthly so that you can invest Rs.25,000 per month in gold will make more sense here.
Gold investment offers a valuable opportunity to diversify your portfolio and secure your financial future. By understanding the different options and following the tips and precautions outlined in this guide, you can embark on a confident and informed gold investment journey.