If you do it right, investing in gold can reap many benefits. Top IRA companies like American Hartford Gold and Noble Gold Investments show that there is money to be made. However, when investing in gold, it’s crucial to look into reviews (such as Birch Gold reviews) to ensure the best quality and prices. Here are some common mistakes that people make when investing in gold:
1. Lack of research
When investing in gold, it’s important to do an adequate amount of research before jumping in. Unfortunately, there are plenty of dealers looking to make a quick buck off of low-quality or fake gold. To avoid this, it’s crucial to ensure that the dealer you purchase from is trustworthy, transparent, established, and reputable. Researching the credentials of the dealer is a great place to start.
2. Not outlining goals
We all have different tastes, interests, and niches. After all, you wouldn’t tell a real estate agent to sell a computer. That’s exactly why buying the product that adheres to your own personal goals is critical. For example, if you’re interested in reselling, gold coins are a safe bet to sell in small amounts—they are smaller and weigh less, making them more versatile for investors—rather than gold bars, which are larger and weigh more.
3. Not checking purity and authenticity
Imagine this: you buy a beautiful piece of gold from a dealer who claims it’s authentic and priced right. You later find out, however, that the gold is inauthentic and priced way higher than what it would go for elsewhere. To avoid a disappointing mistake like this one, it’s crucial to check the purity and authenticity of gold before buying. While there are many ways to do this, some common ones are to look for mint marks, ask the dealer for a certificate of authenticity, and ensure that the gold is not magnetic.
4. Misunderstanding the gold market
By not knowing the current market value of gold, you could end up overpaying or missing out on a sweet deal. Taking the time to understand the gold market—including the factors that affect pricing such as time—can reap long run benefits. This can also help you avoid making emotional decisions about buying gold, such as only making purchases during geopolitical or economic upheaval.
5. Failing to consider storage and security
Keeping your gold safe is just as important as getting it for a good deal. By failing to consider the storage and security of your gold, you are at risk of damaging your new precious metal. Getting a fireproof safe or storing your gold in a bank safe deposit box to prevent elemental damage and theft can go a long way. Similarly, insuring your gold is usually a wise decision: typically, homeowners insurance policies won’t cover the full amount and bank safe deposit boxes aren’t insured.