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My intention is to invest once each month or each other month.

What are my options?

Physically buy some American Eagle/Krugerrand/Maple leaf Gold Coins? I have to admit that they look really good, but storing them at home seems like a security risk, and I wanted to buy it as a safe alternative. so that would defeat the point.

Invest in some gold-backed fund? But that makes me unease about the honesty of it. How can I know I'm not investing in a scam? That could also defy the point.

Rent a safebox and put the gold there?

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    Possible duplicate of money.stackexchange.com/questions/7102/storing-gold-and-silver
    – CactusCake
    Commented Oct 12, 2017 at 12:33
  • @CactusCake: that covers partially my question, but does not answer whether someone should choose EFT or safebox, for example.
    – D. Eoj
    Commented Oct 12, 2017 at 13:08
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    Why buy gold in the first place? What makes you think that the price of gold will continue to rise?
    – D Stanley
    Commented Oct 12, 2017 at 13:21
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    @DStanley: invest or not invest in precious metals is another question.
    – D. Eoj
    Commented Oct 12, 2017 at 14:45
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    @D.Eoj true, but I ask because this seems to be your only investment choice. I'm just making sure you understand the large risk inherent in single-commodity investments.
    – D Stanley
    Commented Oct 12, 2017 at 15:24

1 Answer 1

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Investpedia has a concise list of the ways to invest in gold but doesn't really get a the pros/cons so I'll talk about that a bit.

Physical gold is one common method of owning gold (coins, bullion) but it has a number of costs and risks. The cost of safe storage usually a deposit box or a vault can really eat into your wealth. The cost of the coins can be sometimes much higher than the value in gold so watch where you buy. Also, in a truly end of civilization scenario you probably wouldn't be able to get at the gold. Storing it in your house however carries risks of theft which can be devastating. You can insure the gold but that costs more than deposit storage.

Jewelry and collector coins can look rather pretty but you pay quite a premium over the actual costs of the coins. They carry the same theft risk as well.

Gold ETFs and Mutual Funds track the value of gold fairly well even during the last crash. If you go with a large reputable fund your odds of getting scammed are likely much less than buying coins where people get scammed rather frequently. Still you replace the storage risk and costs of storage with the risk that the ETF/Funds/Banks will fail in which case you may not always get back the full value. Most funds hold physical gold, but some funds use gold futures instead which has some extra risk that the futures won't track gold but has some nice tax advantages over physical gold etfs and holding coins.

Gold futures are complicated and likely too expensive for a individual investor and have some of the same risks as an ETF or mutual fund.

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    As a final word of advice, be careful. Many people fail to meet their retirement goals because of gold, there is a lot of scams and theft, but mainly just because you don't get the returns you tend to get from long-term ownership of stocks and bonds.
    – rhaskett
    Commented Oct 12, 2017 at 17:47

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