Three Reasons To Invest In Gold

Everyone needs to save for the future. Once you have the basics covered like a roof over your head and enough money to look after you and your family for a year should you lose your job you can begin to build up some investments. You will need something to live on in your old age, so you need to invest in financial products that offer security as well as a good return.

It is important to diversify your investment portfolio. If you have never considered including gold in your portfolio, you really should, and here are three good reasons to do so.

Gold holds its value

Naturally, like any investment product the value of gold goes up and down. However, never in the history of gold trading has it become worthless, which has happened to some stocks, annuities, pensions and life assurance products. In some countries, people have even lost money when their bank has gone bust.

The price of gold has never reached the point where it was worthless.

Works well as an inflation hedge

Inflation is the enemy of any investment portfolio. If the rate of inflation outstrips the amount of interest you get your investment grows, but only on paper. In real terms, it has gone down because the rising cost of living means that your money buys you less.

The price of gold tends to do the opposite it goes up when the cost of living rises. This means that having some gold in your portfolio can protect you against inflation.

Gold is in short supply

There is very little new gold being found and mined. In fact, since 2000 gold production has fallen. This means that demand can easily outstrip supply, which bodes well for those who have gold in their portfolio. When something is in high demand, the price stays high or goes up.

The price of gold can go down as well as up, but overall it is a good investment vehicle, which everyone should seriously consider.