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Investing in bullion can be a great way to keep your savings safe from an uncertain market. Gold and silver are well-known as assets that prove resilient to volatility and economic crises.
It can be tough to get started, especially in today’s economy when it’s so hard to save anything. These are four tips for getting started with investing in bullion and one way you should definitely avoid.
#1 Invest Your Tax Refund
Getting a tax refund is always exciting. Whether you’re getting money back from tax credits or because of RRSP contributions, it’s more money in your pocket. It can be tempting to splurge as soon as you get that refund but don’t forget that a tax refund is money that you earned. One quick way to start investing is to use that tax refund to get started.
#2 Rebalance Your Portfolio
If you’re already an investor, one way you can add bullion to your portfolio is by rebalancing it. Many bullion investors make sure gold or silver takes up anywhere from 5 to 15% or more of their portfolio.
You can sell off stocks or other assets to make room in your investment portfolio for this alternative.
#3 Start Small with a Silver Starter Kit
One of the best ways to start investing in bullion now is to start small. You don’t need thousands of dollars to invest in bullion today. Bullion dealers Global Bullion Suppliers have some very beginner-friendly options, such as silver starter kits.
The price of silver is much lower than gold, and that makes it much more accessible to people who are still working on building their wealth. Investing in silver provides an asset with:
- Growth potential.
- Resilience to geopolitical uncertainty.
- A history of maintaining value against inflation.
#4 Keep Saving When You’re Debt-Free
Whether it’s student loans, car payments, or credit card debt, getting out of debt will demand financial discipline. You have to keep up with payments and pay more than the minimum if you’re going to make progress on the principal.
While debt should never be your goal, getting out of it shows some pretty remarkable financial discipline. If you want to pivot from getting out of debt to building your investments, there’s a simple trick.
When you get out of debt, keep saving the amount you usually would have put toward that debt. You’ve grown accustomed to budgeting without having that money to spend, and you will rapidly grow a fund that you can invest in.
#5 Never Use a Loan to Invest in Bullion
Borrowing money to invest in anything is called leveraged investing, and it is a big risk that can lead to a major disaster. The first risk is that you picked a bad investment. If the value of your investment craters, you can’t sell off the asset to pay off the debt. You’re stuck in debt with little to show for it.
The other risk is more pertinent to gold and silver. Bullion is not an asset that generates interest, and borrowing money costs interest. Leveraged investing only makes sense if you get ongoing income that is higher than the interest you have to pay.
Gold and silver are long-term assets that do not generate interest or dividends but can preserve their value against uncertainty and inflation. Start investing in bullion the smart way and keep your savings safe!