Throughout 2020/2021 an unprecedented amount of paper money has been created and therefore every pound dollar, euro, yen etc. is subsequently worth lessthan the one before it. Now more than ever before it is imperative to protect and secure your finances from the devastating effects of inflation. Put simply, inflation is the devaluation of paper money regardless of the currency. Gold is a safe haven and is seen as a hedge against inflation and has been used as real money for thousands of years.  Over time gold has never lost its value and long term has proven to perform very well compared to paper money. As we have seen, paper money can be printed indefinitely whereas gold has a finite supply, with some mining experts predicting there is only 20yrs of mineable gold left.  The gap between the value of paper money and the value of gold has grown over time showing gold increasing in value whereas paper money is decreasing.

Start with the end in mind
In our experience the most overlooked and least considered part of buying metals is what you will do at the other end. When investing in anything it is wise to consider your end goal so that the decisions you make now pay off in the future. Once you have worked out your end goal you can assess if your investment has the means to reach your preferred outcome.

It is very important to consider the following questions;

a. How long do you want to hold your metals for?

b. Will you sell them at a predetermined price/level?

c. Will you hold the metals indefinitely and pass them on to the next generation?

d. Are you wanting to exit over a period of time or all at once?

e. Who will you sell your gold to and at what price?

All of these questions play an important role in deciding what your strategy for buying is and must be considered to ensure you make an informed and effective investment that will achieve your goal.

We suggest that you only buy LBMA certified metals, this is the London Bullion Market Association and is the top standard around the world. LBMA metals are recognised in every corner of the globe which gives you more options when you want to sell your metals. It is not advisable to buy metals that are only recognised by a limited audience even if you get a better price as this can limit who you sell to and the value of the metal.

Although there may be some legitimate sellers on well-known selling sites (e.g. eBay) we would suggest that you don’t use these sites for purchasing precious metals as it is difficult to verify legitimate sellers and this adds an unnecessary level of uncertainty to the buying process.

There are numerous different ways to invest in gold, it is important to note that many of these ways do not give you legal ownership of the physical metal itself. These are simply ways to bet on the price going up.

To safeguard your investment, you should ensure that you legally own the physical metals and that they are fully allocated to you with no counterparty risk. Therefore, if the company you bought from were to get into financial difficulty, it would not affect your metals as they are 100% legally owned by you and not the company.  Storing your metals in a vault outside of the banking system can be a great option but it’s vital you ensure that your metals are not held on the company balance sheet as this guarantees that you have full ownership and control of your precious metals.

Most people just look at the buy price, this is very important but certainly not the only thing to consider. Other costs that can be involved in your investment are storage fees including insurance and auditing as well as other management and handling fees. You should be informed and aware of these fees before you make the decision to invest.

It is extremely important to consider the buyback price that you will receive when it comes to selling your metals and to be aware that you do not need to sell metals back to the same company that you bought them from. The buyback price is most often overlooked however it can make the greatest difference to the overall profitability of your investment.

It is important to consider all of the above when purchasing precious metals to ensure that the actions you take today lead to a more profitable and financially secure future.

To ask the experts Adam & James about gold and silver head over to GoldBusters.co.uk complete the contact form and they will be in touch within the week.