The shiny, brilliant nature of gold makes it very desired, and thusly very valuable and expensive. Investing in the rare precious metal is no doubt a good idea, however can seem like a tricky game. Plenty of scams are out there on the market, and so I am here to give you some tips and pointers on what to look for when investing, how to best protect your money and investment by avoiding scams, and how to find an online dealer.
First off, know that there are multiple types of gold that you can invest in. For one, there is physical gold, including bullion bars and coins. These can be purchased from online or physical dealers and are either shipped to you or stored in a vault for a fee. There are also different types of “paper gold,” including ETFs (exchange traded funds), as well as certain stocks and bonds that you can invest in, such as investing into the securities of gold mining companies. Gold IRAs are another way to own gold, however this is monitored by the IRS and they do not allow investors to physically retain the gold, rather a trustee must be employed to handle the transfer and storage of the bullion.
To understand how to keep your investment legitimate and safe, be aware of the commons scams that can happen regarding gold investment. Regarding paper gold, which is where common scams are more likely to take place, companies will sell you any amount of gold and then send you completely falsified paperwork backing your purchase. So when push comes to shove, there is no actual gold behind your paper certificate. This can be the case with purchasing stocks and bonds as well. Make sure to buy only from trusted, reputable, well-established dealers who have been in business for at least 10 years.
Regarding physical gold, there are two major scams. One is to be sold gold that is very low in purity, and the other is to be sold something that is indeed not gold at all, but rather just has a gold coating over it. The best way to avoid this scam is to again, make sure that the dealer you choose is reputable, well-trusted and has longevity, and ensure that they deal directly with the U.S. Mint (in the case of buying U.S. gold).
Finding a dealer online is possible, but its good to start with what you know best – friends and family. Ask around for names of reputable dealers. Maybe your financial advisor knows of the perfect company. You can use the internet to search too, and when you find a few you are interested in, do thorough research, covering every angle to ensure that the company is trustworthy. Always check multiple sources, and if any red flags at all pop up, bail and try the next one. Good luck!
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