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When most people think of investing, their minds immediately jump to the stock market. However, paper assets have a high level of risk. Many experts agree that it’s safer to diversify your portfolio with a precious metals investment, like gold bars, coins, or bullion. But what’s the right age to invest in gold and start a portfolio?
In this article, our investment experts from Oxford Gold Group will discuss the benefits and risks of buying gold for your wealth portfolio, starting with your 20s and moving through to your 50s. So get ready to learn about the pros and cons of purchasing gold and why precious metals are a relatively safe way to build your savings.
Is There a Right Age To Invest in Physical Gold?
Consider this market data from 2021: about one in four seniors has under $500 in their savings account to pay for medical bills. Several factors make it harder for Americans to save their available income. These are primarily rising inflation, unforeseen expenses, and poor economic conditions.
So, how do those factors affect investing? Is there a “right” or “wrong” age to begin a gold investment?
Well, it depends. Traditionally, older investors have more interest in the gold market than younger investors. However, that doesn’t mean younger people shouldn’t buy gold and invest in precious metals.
Historically, gold has been a strong hedge against high inflation. When America faces a financial crisis, gold prices will rise along with inflation and interest rates. With our nation undergoing a 41-year inflation high, many investors in 2022 are using gold to hedge against rising costs and a poorly performing economy.
Reasons To Buy Gold At Your Age: By the Numbers
Investors who want to buy and sell gold have several options for investing, including:
- Bullion (bars)
- Coins
- Stocks (mining companies)
- Gold ETFs (exchange-traded funds)
- Mutual funds
- Futures and contracts
- Gold jewelry
- Precious metals IRA
So, at which age are gold holdings the most advantageous? Should you start investing early or wait until you’re older and have greater purchasing power?
Investing at 20+: Maximizing the Rise in Gold Prices Over Time
While stocks and crypto are usually more popular with younger people, investing in gold during your 20s offers several benefits. Of course, many 20-somethings don’t have the funds to spare. However, if you can spare enough cash in your 20s to buy gold and maintain your investment long-term, you can build a comfortable retirement.
Plus, when you buy gold in your 20s, you have a much higher risk tolerance than in your 40s or 50s. So even if you make a bad investment, you still have decades to save money for retirement.
Also, gold prices have risen steadily over the years. Yes, the price of gold fluctuates (sometimes within a short period) according to supply and demand and other economic factors. But consider how much higher the gold price will be in 40 years! By investing early, you can take advantage of the lower price margin and make a tidy profit for retirement.
Investing at 30+
By their 30s, most people have a steady income stream and can manage money. Many 30-year-olds have found success by investing their extra cash in gold stocks or physical assets like gold coins and bars.
Gold stocks allow you to invest in companies that explore and mine for gold. In fact, mining stocks offer a surprising amount of upside potential for investors. They may even outperform the price of gold, increasing the value of your portfolio.
Investing at 40+
When you hit your 40s, it’s time to build a nest egg for retirement (if you haven’t already). An effective strategy is to spread out your investments and create a diversified portfolio instead of sinking everything into a single asset. Plus, this method of diversification also mitigates risk. Remember, you’ll be at retirement age in 25 years! That may seem like a long time, but it’s not.
Investing at 50+
Investors over 50 should feel a pressing need to build up their wealth and savings. While investments like the stock market and crypto are highly volatile, physical assets like gold jewelry, coins, and bars offer a safer way to grow your finances. Precious metal IRAs are another popular way for older investors to save for retirement and build wealth.
Pros and Cons of Gold Investing
Next, we’ll discuss the benefits and risks that gold buyers face in today’s economic market regarding precious metal investing:
Pros
Long-Term Value: Physical gold as an investment has stood the test of time over and over again. Gold prices may fluctuate, but they have risen steadily year over year.
Inflation Hedge: America is facing an unprecedented inflation high, but gold offers a way to hedge against those skyrocketing prices and interest rates.
High Liquidity: It’s fast and easy to buy and sell gold. The U.S. always has a healthy supply and demand for precious metals like gold, silver, platinum, and palladium.
Cons
High Capital: At the time of publication, the price of gold is $1,676 per ounce. You’ll need a lot of capital to purchase gold and build a portfolio.
Specialized Storage: You’ll need to pay a third-party facility to store your investment, like a bank or depository. Those storage fees add up quickly, and you won’t be able to have 24/7 access when you want to buy or sell.
Insurance: If you decide to store your gold at home, you’ll have to purchase an additional insurance policy. A standard homeowner’s policy won’t provide coverage.
Build Your Wealth at Any Age with Oxford Gold Group
So, what’s the right age to invest in gold? No matter how old you are, buying gold can help you build wealth and prepare for your golden years. While it does pose some risk, a physical metal like gold offers a safer investment than paper assets, which don’t retain their value in times of economic uncertainty.
Would you like to learn more? Call us at Oxford Gold Group today at 1 (833) 600-GOLD to speak with one of our talented financial experts and learn more about diversifying your portfolio with gold and other precious metals.
