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Are Costco's gold bars worth it?

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Gold bars are worth the price for a lot of investors — and there are a few good reasons for it. Getty Images/iStockphoto

Gold has been revered for its beauty, rarity and value for centuries. It has played a pivotal role in human history as both a currency and a symbol of wealth, and in today's financial landscape, investing in gold continues to be a popular choice. 

But gold comes in various forms, including gold IRAs, gold ETFs and gold bars. And, while the sale of gold bars in particular was once mostly limited to gold and precious metal dealers, the warehouse retailer Costco recently made headlines after it began selling 1-ounce gold bars online last month.

The demand for Costco's gold bars has been so high, in fact, that the inventory is selling out in a matter of hours — making it tough for members to get their hands on them. But while these gold bars may be a hot commodity for Costco, are they really worth it for investors?

Learn more about the benefits of gold investing here.

Are Costco's gold bars worth it?

Costco is currently selling two types of 1-ounce gold bars, which are priced at $1,980 and $1,950, respectively. While that may seem like a high price tag, that price is about average for 1-ounce gold bars. 

And, in general, Costco's gold bars — as well as the 1-ounce gold bars sold by respected dealers — are worth the price, at least for most people. Here are a few reasons why:

They're a tangible asset with inherent value

One of the key advantages of investing in gold bars is that they are tangible assets with inherent value. Unlike stocks or bonds, which can be influenced by market volatility and economic downturns, gold is a physical commodity. 

This means that it has intrinsic worth that cannot be easily eroded. Plus, gold's value is not dependent on the performance of a specific company or government, making it a reliable store of value in times of economic uncertainty.

Find out more about your gold investing options here.

They can be used for diversification and risk mitigation

Diversification is a fundamental principle in investing, and gold bars offer a unique way to diversify your investment portfolio. Adding gold to your investment mix can help spread risk, as it typically doesn't correlate with the movement of traditional financial assets like stocks and bonds. When stock markets are turbulent or inflation is on the rise, gold often acts as a safe haven asset, helping to protect your wealth.

Gold bars can help hedge against inflation

Inflation erodes the purchasing power of regular currencies, and that is a concern for many investors — especially right now, as stubborn inflation continues to impact the value of the dollar. But gold bars have historically served as an effective hedge against inflation. When the value of paper currency decreases, the price of gold often increases, preserving your wealth and maintaining your purchasing power over time.

They offer liquidity and easy storage

Gold bars are highly liquid assets. They can be easily bought and sold on the open market, making them a convenient investment option. And,1-ounce gold bars, like the ones that Costco is selling, are compact and require minimal storage space. You can store them securely in a bank vault or a personal safe, reducing the need for extensive storage costs.

They're globally accepted

Gold is universally recognized as a valuable asset. Whether you're in the United States, China, India or any other part of the world, gold maintains its intrinsic worth. This global acceptance ensures that your investment remains valuable regardless of your location or currency denomination.

Gold bars have a history of long-term appreciation

Gold has a long history of appreciating in value over time — and that includes gold bars. While short-term price fluctuations may occur, gold has consistently demonstrated its ability to retain and increase in value over the long term. In turn, it is a reliable choice for investors seeking to build wealth gradually.

They can help preserve your wealth

Gold bars are an ideal way to preserve and protect your wealth. In times of economic turmoil, political instability or currency devaluation, gold can provide financial stability and security. This makes gold bars an excellent choice for individuals who want to safeguard their assets for future generations.

The bottom line

Gold bars are worth considering as a smart investment choice due to the unique benefits they offer. They can serve as a hedge against inflation, are highly liquid, can help diversify your portfolio and are accepted globally. And, while all investments carry some degree of risk, gold bars have a proven track record of long-term appreciation and wealth preservation.

Before investing in gold bars, though, it's essential to conduct thorough research and consider your financial goals to ensure they align with your overall investment strategy. With these factors in mind, gold bars — whether from Costco or another precious metal dealer — can be a valuable addition to your investment portfolio.

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