For those planning to retire, or at least cut back on working commitments in 2023, top of the New Year’s Resolutions list should be working out how to fund this next stage in life. Investing in gold can be an excellent option for people wishing to retire in the near or mid-term future. Gold is relatively stable with prices increasing year on year. It is tangible, easy to trade and straightforward to store until it is needed. Gold investment also offers an effective way to diversify an existing investment portfolio for relatively little additional cost. It tends to behave differently to stocks and bonds and helps offset losses experienced from price crashes in other areas of investment.
Gold especially offers value to people considering retirement due to its solid track record in retaining value during times of uncertainty. Cost of living concerns, political instability around the world and continuing repercussions from the COVID-19 pandemic mean that personal financial security is prized more than ever.
Precious metal prices often rise during times of turmoil for this exact reason – people know where they stand when it comes to investing in gold coins, bullion or bars and can sell pretty much straight away to release funds when they are needed to cover living expenses.
How to invest in gold for retirement
Another advantage to choosing to invest in gold is that there are several ways in which this can be done. For example, you can purchase physical gold coins or bars from a reputable company. This allows you to physically hold your investment and choose which type of coin or bar to invest in and collect.
You can also select from various values, weights, gold purities and mints. These details are stamped on the gold itself, or contained within accompanying authenticity paperwork. Weights start from as little at 1/10th of an ounce and go up to much heavier amounts. Alternatively, you can invest in exchange-traded funds (ETFs), gold mining stocks or mutual funds, but this can require slightly more enhanced knowledge of how the markets work.
Once you have worked out how you want to invest in gold, the next decision to make is how much money to commit. There are no upper or lower limits legally, but you will ned to bear in mind how the tax situation is affected, as well as how much money you need to keep in cash or in a bank account for instant access. A gold investment company will be able to advise you further on tax implications, including inheritance tax and capital gains tax.
Some more top tips
Registering for an account with your chosen gold investment company will help you keep track of what you have bought, how much for and what its value is at any given time. You can also use your account to sell your gold when you need to liquify some funds – you can often get favourable rates when you buy and sell from the same company. A good habit to maintain is to also keep track of your investment in another way, such as an Excel spreadsheet. This means you can spot any inconsistencies straight away, should they occur.
Keeping a close eye on how your investments are doing can be both fascinating and lucrative, as you can spot when prices are rising or falling and take advantage of how the market is performing. Always act sensibly, as investing for retirement purposes needs to be managed for the longer term. If you do find yourself making more profits than planned, these can be ploughed back into buying more gold or used to fund larger things, such as house deposits for children or grandchildren, home repairs or charitable donations
Finally, choose gold coins or bars that appeal to you personally. Gold is a tactile and beautiful precious metal and there are countless attractive designs available on coins, medallions and bars. Choose a theme of interest, such as royal commemorative coins, historical medals or gold bars from a specific country, heritage or mint. If you plan to leave your gold portfolio as part of your estate to your children, grandchildren or other loved ones, you could consider doing some research into your collection, writing or printing your findings out and keeping them safely with your gold to add interest and provenance.