About 6,000 years have passed since man began to mine gold for the first time and even today investing in this precious metal has certainly not gone into disuse, in fact many are wondering if it is worthwhile to invest in gold today.
We at Financial Empires will give you an answer today on this issue, also trying to understand when it is convenient to invest in gold to avoid spending money on an investment that could prove useless based on the period in which you choose to make it.
Why invest in gold
Gold is a very ancient precious metal, it is used in the field of luxury jewelry, in the construction of medical machinery and electronic devices, today thousands of tons of gold are extracted every year, the main gold producing countries are : China with 429 tons of gold, Australia with 289 tons, Russia with 272 tons, the United States with 210 tons, Canada with 171 tons.
Those mentioned are only 5 of the gold producing countries but there are gold mines also elsewhere, albeit of lesser importance.
At this point it is clear that interest in gold is linked precisely to its very large market, its price hardly tends to fall and precisely because of this characteristic it is defined by economists as a “safe haven”.
Gold is therefore a safe haven asset precisely because in the phases of decline of the economy it helps to preserve one’s wealth, in what way? By converting your money into gold before it loses its value.
It pays to invest in gold today
Without too many words, investing in gold is worthwhile today, we find ourselves in a stalemate in the economy, between the pandemic and the war in Ukraine, market sentiment has dropped a lot, the stock exchanges are very sensitive and also the confidence in the big companies. economic powers is lowered.
Added to this is the generalized inflation on prices, the increase in unemployment and the fear that a war may also arrive in our country, albeit in a very pessimistic perspective of the current situation.
Precisely for this reason the price of gold skyrockets, so if on the one hand it is not the best time to buy it because you usually buy it when the price is down, on the other hand, transforming your capital into gold gives us a security that no coin could ever give us.
In fact, if a possible war or even just a strong enough economic crisis were to break down in our country, the currency could be affected to such an extent that it no longer had market value and at that point only owning gold could put us in a position to save ourselves.
Our advice is to always keep an eye on the gold prices in real time, in order to invest when the gold price drops at least slightly to get the best possible market price when you intend to sell it again.
It is worthwhile to invest in physical or financial gold
In ancient times, the only way to invest in gold was to physically own it, but in the 21st century things have changed slightly, in fact there is also talk of investing in financial gold, but what does it mean exactly? And where is it worth investing in physical or financial gold?
Financial gold means the possibility of investing in financial instruments directly related to gold or the price of gold, in the latter case we are talking about derivatives.
In general, financial gold can be translated into: ETFs, mutual funds and futures.
While physical gold includes: Jewels, ingots and gold coins.
Financial gold compared to physical gold has significant advantages, for example it is much cheaper and more convenient to invest in financial gold for the small investor, as the latter having limited capital availability could not afford to pay a safety deposit box. to keep the yellow metal, or it may not be convenient to pay a fee to the bank that should take care of keeping it safe and so on.
In short, financial gold is certainly cheaper as all costs related to the actual possession of physical gold are reduced.
On the other hand, however, also physical gold has advantages, in fact the latter is exempt from VAT, this means that you can convert your liquidity into gold without being taxed, but be careful, however, not all that glitters is gold, in fact in sales phase on your proceeds you will have to pay a tax of 26% on the initial purchase price.
So if you thought of investing 1000 euros in gold and then resold it when the price was higher than 1500 you will have to pay 26% tax on the initial 1000 euros, for this reason it is important that you always keep the invoice during the purchase of certified gold bars or gold coins.
In the unfortunate event that you do not have the invoice because you have lost it, then a 25% tax will still be applied to you based on the proceeds of the sale.
That said, if you are a small investor it might be worth investing in financial gold while if you are an investor with higher possibilities you may find it convenient to invest in physical gold.
Today we have seen that investing in gold is convenient when the price is low or in very critical economic situations in which you want to safeguard your capital, we have seen the main difference between financial gold and physical gold with the pros and cons, therefore we believe that you have acquired a general smattering that allows you to judge for yourself whether it is worthwhile to invest in gold today or not based on the scenario we are currently experiencing.
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Financial Empires, The Editorial Staff
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