Protect Your Wealth When You Invest in Precious Metals

Investing is risky. Buying stocks can be a great way to generate passive income, grow your wealth over time, and save for the future, but the stock market can be volatile. Leaving your money in the bank isn’t a great idea, either, because while you don’t risk losing it to a market crash, you are guaranteed to lose purchasing power to inflation over the years.

Putting your money into precious metals offers you a way to protect your wealth from inflation and from the ups and downs of the stock market. Precious metals hold their value well, keeping track with inflation so that you can retain your money’s purchasing power over the years. Precious metals like gold, silver, palladium, and platinum also have intrinsic value, so their worth isn’t tied to the stock market or to the value of the currency. That’s why precious metals have long been a trusted method for protecting wealth over time.

Precious Metals Are Immune to Inflation

There’s a reason why financial experts advise investing in the stock market despite the market’s well-known volatility — historically, your stock market investments are likely to grow more valuable over time, at a rate that outstrips inflation. That means you don’t lose your money’s purchasing power over the years, like you would if you put it in a bank savings account drawing a few dollars a year in interest.

Inflation is a fact of life, as goods and services will naturally cost more over time. When you buy precious metals, your investment retains its value in spite of inflation. The value of precious metals isn’t tied to the value of your local fiat currency — rather, it’s inherent. So when inflation occurs, your gold or silver or platinum or palladium gets more valuable, so your money retains its purchasing power.

Buying precious metals also serves as a hedge against times of hyperinflation. When paper money becomes worthless due to economic collapse or political upheaval, gold, silver, and other precious metals still hold their value. That’s what makes precious metals a popular investment vehicle among survivalists and doomsday preppers — if you have savings in precious metals, you’ll still have something of value that you can exchange for food, shelter, medicine, or safe passage, as needed.

You Can Avoid the Volatility of the Stock Market

Some people put all their savings into precious metals, hoping to avoid losing money in the stock market. And while the price of precious metals can be volatile, they do usually gain value over time. Even if you don’t want to put all of your money into precious metals — and doing so could be ungainly if you’re going to need to convert some of those assets to cash anytime soon — you can still shore up your portfolio against market collapses by adding some precious metals to your holdings. Put between five to 15 percent of your investment holdings into precious metals, to hedge against market fluctuations.

Precious metals can protect your wealth from market crashes because, when the market dips, investors lose faith in stocks and bonds and want to pull their money out of those securities and put them in something more stable. That something is precious metals. You’ll often find that precious metals go up in value when the stock market is going down. That’s a reflection of investors seeking to offset their losses by moving their holdings into precious metals, which have a long reputation of holding intrinsic value.

Anyone Can Buy Precious Metals

You don’t need a lot of money to be able to invest in precious metals. You may not be able to afford to buy an ounce of gold or palladium all at once, but you can buy the more expensive precious metals in smaller weights — as small as one gram. A gold bar may be too expensive to buy outright, but you can buy a 5 oz silver bar for a fraction of the cost.

silver barIn fact, silver is the ideal entry metal for investors looking to get a foot on the ladder of precious metals investing. Silver has a much lower spot price than more expensive metals like gold, palladium, and platinum, making it more accessible to the average investor. And because silver has a range of industrial applications, its price is more likely to fluctuate in the short term, leaving you the opportunity to realize some short-term profits on your silver investment.

Investing your savings always carries risks, but you can mitigate some of those risks by putting money into precious metals. Gold, silver, and other precious metals never lose their intrinsic value, no matter what happens to the economy. So protect your wealth today, and buy some precious metals.