Investing in Gold for your Future

Are you thinking about your strategy in saving? Do you wonder how you could improve your life after retirement? Then you aren’t alone. Most of the people, especially those hit by the fall of the era of greatness which is the time where people were still able to create their profits. The increase of age or aging gives us less the ability to do work. In addition to that, investing in something has maintained its value throughout the ages. People see investment as a way to pass on and preserve their wealth from one generation to the next.

The fact is that, if you invest in a Traditional or Roth IRA or a company-sponsored plan such as a 401(k), you may not be aware of some weaknesses that are common among all of these paper-backed investments. This is a big help for you!

So thinking about gold? Gold is respected throughout the world for its value and rich history, which has been in cultures for thousands of years. Throughout the centuries, people have continued to hold gold for various reasons. Below are eight reasons to own gold today.

The increased wealth of emerging market economies boosted the demand for gold. In many of these countries, gold is intertwined with culture. Whereas gold bars are a traditional form of saving, the demand for gold has been steadfast.

Demand for gold has also grown among investors. Many are beginning to see commodities, particularly gold, as an investment class into which funds should be allocated. SPDR Gold Trust became one of the largest ETFs in the U.S., as well as one of the world's largest holders of gold bullion in 2008, only four years after its inception.

Paper-backed investments are based on the value of money. The value of money can be measured by buying power and exchange rate. Buying power is the number of goods or services that are exchanged for your money. Exchange rate, for instance, the value of your currency versus another currency. Since the United States went off the Gold Standard, the dollar has become weaker and weaker in terms of buying power. This affects your daily life because if the value of the dollar decreases, gas prices go up, food prices go up, and your dollar does not go as far as it did before.

History has shown that gold tends to rise with inflation, meaning that the gold that you own can still be exchanged for the same amount of goods and services year in and year out. Because the US government continues to print more money, the cash in your wallet buys less every year; the supply of gold is defined so it will always hold value. Over the past 50 years investors have seen gold prices soar and the stock market plunge during high-inflation years.

In addition to its use as an investment channel, gold has many practical uses that are in demand. The jewelry industry makes up more than 50% of the global demand for gold, and with global populations at an all-time high, demand will continue to rise.

Gold retains its value not only in times of financial uncertainty but in times of geopolitical uncertainty. Due to this uncertainty, people flee to its relative safety when world tensions rise; during such times, it often outperforms other investments. For example, gold prices experienced some major price movements this year in response to the crisis occurring in the European Union. Much of the supply of gold in the market since the 1990s has come from sales of gold bullion from the vaults of global central banks. This selling by global central banks slowed greatly in 2008.

Gold should be an important part of a diversified investment portfolio because its price increases in response to events that cause the value of paper investments, such as stocks and bonds, to decline. Although the price of gold can be volatile in the short term, it has always maintained its value over the long term. Through the years, it has served as a hedge against inflation and the erosion of major currencies, and this is an investment well worth considering.