The rich history and value of gold makes it respected throughout the globe.
Since it was first mined some 7000 years ago, it has been used in various cultures as part of tradition and customs; most important, it has shaped how the world financial system works.
Historically, governments and institutions used gold as a way to measure wealth and stabilise the economy.
Despite this, over the years, the number of people owning gold has significantly dropped.
One of the reasons this may be happening, is the fact that the US dropped the “gold standard” money system in 1971.
This meant that the US dollar, which was previously pegged to gold, was no longer the case.
However, to this day, when financial instability strikes, gold is the very commodity that people buy as it is still considered a stable hedge against uncertain times.
Besides that, here some other reasons why you should start owning gold!
1. Past currencies of the world, including the USD, have seen their value fall drastically. When currencies have tremendously fallen in the past, such as with the dollar between 1998 and 2008, the price of gold remained high and people placed their security in gold.
2. As the cost of living increases, the price of gold continues to rise and hence it is seen as an excellent hedge against inflation.
3. The world today is full of geopolitical uncertainties and since paper money does not retain its value but gold does, owning gold can prevent one from falling into crises with their commodities.
4. There are no counterparty risks associated to those who own gold. This is because there are no middlemen, paper contracts or other parties needed. It is, as a result, the only financial asset which is not simultaneously a liability to another entity.
5. Compared to paper money and other financial assets, gold is one of the few assets that can provide privacy. For many other financial assets, people must still report them as gains when filing their income tax. Gold can be anonymous if one chooses it to be, other people or the government would not know about the gold they have.
6. Gold makes it easier for one to own bitcoins in their retirement portfolio. The sufficient diversification of gold allows it to be actively traded by investors worldwide. While bitcoin is seen as an alternative asset, gold offers an even better opportunity which is not widely available.
7. Owning gold as a replacement for paper money is a form of tax-free saving. The process of owning gold is tax-free regardless of the plan that one has in place. With gold, one can create a rollover without losing part of the savings to tax.
8. In many countries, the government or regime’s debts continuously increase. This means it is possible that paper money savings might be affected significantly unlike with gold which historically helped track global debt.
Compared to other stocks, gold is a bargain. Its S&P ratio is currently at its lowest point in the past ten years. Compared to gold, the stock market is overvalued. Additionally, the stock markets are in a massive bubble.
9. Over the past decade, wealth in economies of emerging markets have increased. This greatly boosted the demand for gold but, the production of gold is declining globally. Many investors now see the value in commodities such as gold being allocated. As such, a great fortune can be made by the long-term gold investors.
Check out the HelloGold app and take charge of your future in gold saving now!