5 cheap and easy ways to invest in gold right now
These days, investors have a lot of asset options to choose from, including traditional investments, like stocks and bonds, and alternative assets, like cryptocurrency. And, while too many choices can be overwhelming, in this case, it's a good thing. After all, diversification is a key strategy when building a portfolio that can withstand losses due to economic fluctuations, so you need to have a good mix of assets in your portfolio.
But buying into a variety of investment assets is just one part of the equation. When you diversify your portfolio, you also need to ensure that your investments come with variable levels of risk. That way, the safer assets offset potential losses from the riskier — but potentially more lucrative — options.
That's where gold can play a role. Gold has long been considered a safe-haven asset that acts as a hedge against economic uncertainties, which makes it a smart addition to a well-diversified portfolio. And, while some methods of investing in gold can be costly and complex, there are several affordable and straightforward ways to add this precious metal to your investment portfolio right now.
Learn more about how a gold IRA could benefit your investment strategy.
5 cheap and easy ways to invest in gold right now
If you want to add gold to your portfolio without much hassle or expense, the following options could make sense to consider:
Gold exchange-traded funds
Investing in gold exchange-traded funds (ETFs) has gained popularity in recent years and it's due, in large part, to the simplicity and cost-effectiveness of this type of investment. Gold ETFs allow investors to gain exposure to the price of gold without physically owning the metal. These funds will instead typically track the performance of gold bullion and provide a cost-effective way to invest in gold, as they have lower expense ratios compared to actively managed funds.
Investing in a gold ETF is as simple as buying shares through a brokerage account. You may have to pay broker fees for transactions related to gold ETFs, but this method provides liquidity, flexibility and transparency, making it an ideal option for investors who are looking for an easy entry into the gold market.
Find your top gold IRA options online now.
Gold mutual funds
If you prefer a hands-off approach, gold mutual funds offer a diversified portfolio of gold-related assets managed by professionals. These funds may include investments in gold mining companies, bullion and other gold-related securities.
It's worth noting, though, that gold mutual funds will typically have slightly higher expense ratios compared to ETFs. However, these types of mutual funds provide investors with the expertise of fund managers who actively make investment decisions based on market conditions. In turn, this option is particularly appealing to individuals who want exposure to gold but lack the time or expertise to manage their investments actively.
Gold savings accounts
Some financial institutions will offer gold savings accounts to investors, allowing them to buy and sell gold in small increments. These accounts are linked to the real-time market price of gold and offer a convenient way to accumulate the precious metal gradually. The gold is usually stored securely by the financial institution on behalf of the account holder.
Gold savings accounts are an easy way for you to start building a position in gold without the need for a large upfront investment — which can be ideal for those who aren't ready to invest a hefty amount of cash. And, these accounts provide the flexibility to convert gold holdings into cash or take physical delivery of gold when desired, which is a pretty notable bonus for the right investor.
Gold bullion coins
If you prefer to own physical gold, gold bullion coins may present a cost-effective and tangible option. The American Gold Eagle, Canadian Maple Leaf or South African Krugerrand are popular choices, as these coins are made of pure gold and are generally easily tradable in the market.
While purchasing physical gold may involve higher transaction costs and storage considerations, it provides you with a tangible asset that can be held in your hands. And, it's easy to find this type of investment, as many reputable dealers offer gold bullion coins. Plus, the prices on gold coins are generally close to the spot price of gold, making them a relatively affordable option for most types of investors.
Gold individual retirement accounts
Gold individual retirement accounts (IRAs) allow investors to incorporate gold into their retirement savings. A gold IRA works similarly to a traditional IRA, but instead of holding conventional assets, it includes physical gold or other precious metals. Setting up a Gold IRA involves working with a custodian specializing in precious metals, who ensures compliance with IRS regulations.
Gold IRAs offer a tax-advantaged way to invest in gold, which keeps your investment costs lower over the long run. These accounts can provide a hedge against inflation and economic uncertainties as well. While there are some administrative and storage fees associated with gold IRAs, they offer a unique opportunity for you to diversify your retirement portfolio with a tangible and historically valuable asset — along with some pretty big tax advantages as well.
The bottom line
Investing in gold doesn't have to be a complex or expensive process. There are a variety of options available, allowing you to choose the method that aligns best with your preferences and financial goals. And, the choices outlined above also provide opportunities to diversify your portfolio without breaking the bank — so they can be worth considering if you're trying to find ways to invest in gold both easily and affordably. As with any investment, though, it's crucial to conduct thorough research to make well-informed decisions based on your unique financial situation and objectives.
