Smart gold investing starts with deciding on an investment strategy. The first step for the investor is to set goals and maintain reasonable expectations. Smart gold investing for short term profit will require a different approach than investing in gold to achieve the excellent returns possible with investments held over many years.
Short term gold investing is reasonably defined as buying gold bullion coins or bars, and holding for 14 months to two years before selling. Smart gold investing takes into account how fast the gold market will rise and if there will be corrections. Smart investing may well be to hold a little capital in reserve to invest when there is a correction.
When the investor sells gold bullion after a run up in gold prices he or she needs to pay capital gains taxes. Part of the reason for holding on to gold for more than a year is that short term capital gains on assets held for less than a year are taxed at the investor's regular tax rate. Assets, including gold bullion, held for more than a year are taxed as long term capital gains which may well be at a more favorable tax rate.
For the investor interested in long term appreciation of assets a more profitable approach is often to invest in investment grade certified rare gold coins. Over many years these investments tend to appreciate substantially more than gold bullion.
Also, individuals often invest in gold as a hedge against a falling dollar and economic uncertainty. The nation and the world are in the worst recession since the Great Depression. Things got so bad in 1933 at the start of the Depression that the United States Government confiscated privately held gold and then devalued the dollar. At that time rare gold coins in coin collections were exempted from confiscation while bullion went into the government coffers.
Smart gold investing needs to include an appreciation of how well certified, investment grade rare coins can appreciate over the years and the legal precedent attached to these coins when times get worse and the government comes again to demand gold bullion.
For more information feel free to call 1-800-300-0715 where our gold experts will be pleased to answer any of your gold investing questions.