Investing in gold? Here are 3 things you may not have known

In today’s economy with cooling inflation but still high interest rates, many Americans find themselves taking a closer look at their savings — and their investments. One such option that has taken on new life in 2023 (and came close to a record-high price in April) is gold. The precious metal may not be the first investment type that comes to mind, but that doesn’t mean it’s not valuable, either.

That said, like any investment, it helps to do your research and understand your options before jumping in. To that point, there are some things about gold investing that you may not have known but that can still help you invest in the best and most valuable way possible. By accounting for these three factors you can more effectively — and successfully — start adding some shine to your investments.

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3 things you may not have known about gold investing

Here are three things you may not have known about investing in gold.

The amount you should invest varies

While gold investing can be beneficial for those of all ages, the specific amount you should have in your portfolio varies from person to person. Younger people, for example, who have a longer investment horizon in front of them, will do best by investing more in gold than older investors close to retirement age who will need more income-producing investments. 

While the general rule is that gold should be limited to no more than 10% of your overall portfolio, how much of that 10% you utilize will depend on your age and personal financial situation. Younger people will likely want to be closer to the top of that range while older investors and prospective retirees may want to be on the lower end. Still, everyone is different, so it pays to be introspective and understand all your options before diving in.

Learn more about investing in gold for retirement here now.

There are multiple ways to invest 

We’ve all seen television commercials showcasing shiny gold coins, emphasizing the benefit of buying gold that way. And while that may be an option worth pursuing, there are multiple other ways to invest in gold, too. You could put some money into a gold IRA (a common way of hedging against inflation and diversifying your portfolio with gold). Or you could pursue a gold exchange-traded fund (ETF). If you like speculating on where gold is heading amid larger economic concerns then gold futures may be for you. 

The bottom line is this: There are multiple ways to invest in gold. So make sure you’ve found the best way for you before you get stuck with a type that didn’t meet your goals (and that you have to pay to store in the interim).

It won’t produce income like other investments do

Gold is a smart way to protect your hard-earned money, but there’s a reason why experts say you should limit how much you invest. That’s because gold, unlike some other investments, isn’t known for producing immediate income. If your primary goal is that then you’ll generally want to stay more with stocks and bonds. 

That said, stocks and bonds can be volatile and you can make money as quickly as you could lose it. That’s why gold is a reliable backup for when the market sours and inflation roars. Just don’t expect to buy low and sell for a high profit right away.

Learn more about gold investing with a free investors kit now!

The bottom line

Gold investing may not be the first thing you think of when it comes to your money but it can still be worthwhile and effective, particularly as the economy rebounds from a period of high inflation. To get the greatest return on your gold investment make sure you understand how much to exactly put into the precious metal and explore all of the different options available. Finally, understand that gold is a long-term investment with long-term benefits and that it typically won’t provide a get-rich-quick route.