For hundreds of years, people have trusted gold as an asset that doesn’t lose its value. The resilient, non-rusting metal has been in demand all around the globe for millennia, where it is used in everything from technology and jewellery to tooth fillings. However, investing in gold is not totally risk-free. Investors may be sold counterfeit products or offered prices above the fair market value. Here are the tips you need to buy gold safely.
1. Verify Authenticity
There are many different ways to buy gold as an investor today. We will focus here on ones where you do take physical possession of it, such as buying gold jewellery. One of the main risks you face when doing so is being sold a counterfeit product. That’s why it’s important to always get a certificate of authenticity or assay report from the seller, and to inspect the hallmarks.
2. Buy From Reputable Sellers
Whether you want to sell your gold or buy some, one of the best ways to ensure that you get a fair price is to transact only with reputable dealers. These can also include banks, mints, or government-authorised distributors. Besides relying on their perceived reputation within the gold market, you can also investigate whether they belong to any industry associations. These usually require members to adhere to strict standards of professional conduct.
3. Understand Pricing and Premiums
When you physically buy gold, you’re not just paying for the metal. The price for that, known as the spot price, fluctuates daily and is worth knowing as a reference, but you will pay a premium on top of it. This covers things like the cost of mining the gold, distributing it, and moulding it into bars, coins, jewellery, and other forms. Comparing premiums from different dealers can help you find a fair price.
4. Use Secure Payment and Delivery Methods
Transactions involving gold are often large. For this reason, it’s best to stick to highly traceable payment methods like bank transfers or credit cards, which ensure the transaction is recorded. The banks and credit services may also be able to help with dispute resolution if problems are identified later. If the gold is being delivered to you, always opt for tracked and insured shipping.
5. Store Your Gold Safely
You won’t need the same level of protection as governmental gold reserves, but it is important to store your gold securely if you are treating it as a long-term investment. A home safe may suffice for small amounts, but many investors prefer safe deposit boxes inside banks. If you choose home storage, check if it is covered by your home insurance. Record and photograph how much is there in case it gets stolen or lost.
Conclusion
When you buy gold, it’s important to exercise common sense and caution. This valuable metal is highly alluring, but that sadly means that some people will try to fake it, overcharge for it, or steal it. The five tips outlined in this article will help you avoid all of these things, allowing you to feel confident in your investment.
