Before investing in gold, it is necessary to know about the safest way of buying gold. One must have the knowledge about buying physical gold and keeping it in the right and suitable jurisdictions to have the protection of gold investment outside the banking system.
Here are the top 10 most important tips about dealing in gold:
1. Only Physical Gold
The basic philosophy which works behind the dealing of gold and silver is that it functions exactly like money. And every investor must be familiar with that. For about 5000 years ago, gold and silver were used as money.
In 1971, Nixon was the first person in the history of mankind, who introduced the system of paper currency. He shifted the system of dealing from physical gold to paper money which was not financially supported by gold.
Before 1971, all paper money had got material and moral support by gold.
It is important to note that in this era, the world’s paper money is not financially supported by gold which is in the safe custody of the different government.
As the trend of people who buy money that is morally supported by a physical commodity increase, the paper market for gold has grown to a great extent.
Never buy gold on paper. Always buy gold physically. Most of the people believe that they own gold if they have paper currency. However, when they go to the bank and ask for gold, they don’t find enough physical gold there. So always try to buy physically gold instead of paper currency.
2. It Must Be Under Your Direct Ownership
It is a quite famous proverb that, “If you cannot hold your gold, you don’t own it.” This point is important for those persons who do not have a lot of money to invest in gold. If you are going through such a situation, you should purchase a small number of gold coins physically. Keep these gold coins nearby your residency. So you have these gold coins whenever you need it.
If your financial conditions are good, and you have decided to invest a considerable amount of your wealth into physical gold, you should keep it into jurisdictions that have strong private property rights.
Another point to keep in mind is to make sure that you are the real owner of that gold, and that gold belongs to you directly while singing an agreement with a gold storage company.
3. Only The Most Liquid Coins And Bars
If you want to purchase as much gold for cash as possible, the main and suitable rule is to build up your liquid gold.
In other words, you are investing in legal tender coins. You must go through a process of confirmation that they are all legal tender with small fabrication fee.
While buying gold through a shop or an online store, never pay more than 5 to 6 %. One important point in this regard is never buy gold on eBay or any other online platform. If you have no option other than such platforms, you must be careful while buying gold through phone sources.
4. Build Up Liquid Stocks
As we know that gold is an insurance which is related to money. It is a way of building up saving over a long period of time. To understand this fact look at an example.
A person invested about $100,000 in gold in the year 1970. At that time the investment was suitable to buy about 1800 ounces of gold. According to the recent price of gold, he would be the owner of about $ 2million.
Nobody can print wealth out of nothing. It is quite impossible. It can be done for a specific period of time, but debt is to be repaid.
According to some reports, in 2008, the credit in the financial systems was 140 trillion but now we have almost 210 trillion of credit. This is a colossal amount. We should put liquid gold on the side, and have direct access to our gold in a period of crisis.
5. Don’t Use Credit Buy With Savings
The current system depends on credit, debt, and consumption. These three things are the direct and exact opposite of a healthy economy. The backbone of a healthy economy is to save money before investing it in buying gold.
If you want to buy gold, you must use your savings, put your saving on the side. Always make sure that this amount is yours and you are the direct and sole owner. Don’t use your credit card to buy gold. It is a fantastic way to invest a large amount of money in gold because nobody knows the market.
Always use your saving to buy gold.
6. Store Some Coins Near You
It has been described briefly, you must have direct and easy access to your gold. So that you might have your gold whenever you need in the period of crisis. For this purpose, you can put your gold coins in a safe house.
Another important point in this regard is that you must not place or save all of your gold nearby. Keep only a handsome amount of gold in your direct access. You must insure yourself outside the country so that you may use that gold in any misadventure.
7. Store Some Of Your Gold In A Safe Jurisdiction
You must keep a small amount of gold in safe jurisdiction because of the above-mentioned reasons. Gold must be stored in those jurisdictions where political powers are limited. One of the safest place in the world in respect of jurisdiction is Switzerland.
The question is why Switzerland is the safest jurisdiction in that respect. The simple answer to that question is that Switzerland has a decentralized its political system with seven presidents.
The states and municipalities have limited powers to govern. No one knows the name of the president in Switzerland. It is the last saying of Swiss people that they do not allow anyone to seize their property with authority. This is a unique system of government which is not prevailing in any other country.
8. Always Store Outside The Banking System
The ongoing system of banking was founded on credit, paper and the third one is computer digits. As so many people are buying gold to protect themselves, will result in an enormous banking crisis. Physical gold is an antidote to the current banking system. So if you are interested in investing in gold, it is mandatory to keep it outside the banking system. Property rights provided by current banking systems are temporary in their nature. It has been reported in the past that banks had sized the properties such as gold and cash.
9. Be Compliant With All Laws When You Buy
If you want to invest in gold, you must purchase a few coins. The benefit of buying a small amount of gold is that you can buy them privately and this is a quite legal and positive way. When you will buy gold in small denominations, you would buy anonymously. In this way, you would not show your identity. With disclosing any personal information you would be able to buy a few coins of gold and it is fully legal and positive. Another benefit of buying a small amount of gold is that it will provide you more security and privacy.
According to law, if you are going to invest a huge amount of wealth in gold, you must follow the law and it should be declared.
10. Only Invest Money You Don’t Need For Five Years
The most important and solid point in this respect is that only invest that amount of money which you do not need for the next five years at least. If you are buying a huge amount of gold, it means you are waiting outside a bull market. Anything can happen in the next five year. If you want a handsome amount of profit, you must wait for about five years.
An Important and insight trend of gold investors
The trend of the clients is changing such that they are moving their assets from different banks to their private held vaults. There are several reasons behind this act. Here are a few important reasons: