How to Invest in Gold

A popular investment for thousands of years, gold still functions as a viable investment in the 21st century. Gold provides investors with a “safety” play against inflation and recessions that can drag down investments such as stocks and bonds. It’s especially attractive for investors nearing retirement who want to avoid one of the disastrous 500-point drops in the Standard & Poor’s 500 Index (S&P 500) with a safe investment that’s tied to an actual product. Other investments seem very virtual or have values that can disappear overnight, so gold continues to provide a sense of comfort.

Buying Bullion

It’s relatively easy to purchase actual gold. The first route of purchase for many new investors is to buy one-ounce gold coins, as they are a standard size and highly liquid. The other option besides gold coins is to purchase actual gold bullion. The larger types of bullion are the gold bars featured in hundreds of movies and TV shows. The common sizes for these bars are one kilogram, which is about 32 troy ounces, the 100-ounce bar, and the larger 400-ounce ingot which weighs nearly 30 pounds.

Once the gold is in your possession you need to know how to store it safely. Some investors will keep their gold at home, ideally in a large and heavy industrial safe or similar location. Keep in mind that at current prices (late October 2017, the larger 400 ounce bar costs around $500,000) large quantities of gold will require a more secure storage option.

Consider using a depository company that’s fully insured and will allow you to check on your investment at your convenience. These companies can safely manage your gold, and even offer armored car transport for especially valuable holdings. For smaller shipments, they’ll likely use insured FedEx packages.

A Golden Retirement

Investors looking for long-term protection against inflation and steady price increases should consider a gold-based Individual Retirement Account (IRA). These are structured the same as traditional IRAs, with a few important differences. With a gold IRA, the investor is purchasing actual physical gold which is held by a trusted custodian who possesses and safeguards the metal. Since the investment is an actual quantifiable good, the value stays consistent and cannot be devalued (like a runaway currency).

Buying gold for an IRA involves starting a new account or transferring money from an existing 401(k) plan or other IRA and then using those funds gold. Such an investment gives people a way to diversify beyond stocks and bonds and helps “recession-proof” their money, especially if individuals are nearing retirement age.

Another investing option for gold is to purchase a gold-based ETF, which is an exchange traded fund that tracks the price of gold and is tradeable just like a stock. It allows an investor to gain access to the benefits of gold (stability and immunity to inflation) while not having to actually possess gold coins or bars. The value of these ETFs moves closely with the price of gold, and provides investors with a way to employ more complex investing decisions such as shorting.

To learn more about how to add precious metals to a range of retirement investment accounts including traditional and self-directed IRAs, as well as IRA and 401(k) rollovers, visit

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