For most of us, the new year brings about new opportunities. Certainly, I would consider myself amongst them. We can apply this idea to all facets of life, and personally I am really looking to improve my investing game. That is why I started to look into precious metals – they seemed to be an asset on the up and up based on the press coverage that I was seeing!
Today, I am here to discuss with you whether this is true or not. Spoiler alert: it certainly is the case. I am getting ahead of myself, though. First, we will discuss what precious metals are, the role that they have in the investment world in general, and some of the reasons that people have for purchasing them. If that sounds interesting, be sure to stick around for the rest of this piece!
The Basics: What are Precious Metals, anyway?
It only seems appropriate to start out here, right? So – let us go ahead and cut right to the chase. Precious metals are a group of specific metals on the periodic table of elements. You can find some important contextual information on this page, if you would like a brief refresher on the table of elements in general.
Otherwise, though, I will be speaking a lot more generally on this topic. All that you really need to know on the chemical level is that these are rare metals that are highly conductive, malleable, and do not degrade easily. While it was their rareness that made them so popular in the past, these days most folks seem to put much more stock (or importance) upon the other
factors that I listed above.
Of course, it does remain true that these are finite resources. However, there are certain groups working on making some artificial versions that can be used to mimic the appearance of gold in particular. This means that while certain collectibles might be able to be recreated with said artificial materials, the real stuff will be put to those other uses that I was talking about.
In terms of investing, the ones that typically get the most attention are gold, silver, palladium, and platinum. Obviously, gold gets the most traction considering how it is fairly unique in color compared to the other three, and the whole “it incited a lot of the colonization across the world” thing as well. The fabulous jewelry that can be made from it, let alone getting into the other collectibles, make it something well worth investing in.
What Does Retirement Have to do with it?
If you were not aware, oftentimes the question of retirement comes up in discussions about precious metals. For instance, you might hear about the best Gold IRA Reviews if that is something that someone you know is considering. Pretty much everyone needs to save up for their retirement, so it should really come as no surprise that some opt to utilize gold or other precious metals in doing so.
How does that work, though? While it definitely seems like it would be a complicated process, I have some good news – it really is not all that hard if you know the steps involved. Of course, having someone along the way who can assist you or walk you through it can certainly still make a difference.
Admittedly, much of it does in fact come down to the broker that you decide to purchase your bullion from, and if they offer additional services such as helping you to establish an IRA (individual retirement arrangement) when you do so. While it may not seem all that important to do, there are actually many motivations that you could have for creating one.
Precious Metals IRAs are a type of self-directed account, which does mean that you will end up having a lot of control over it. However, similar to the other types of IRAs, there are some restrictions put in place by the Internal Revenue Service. Check out some of those on this page: https://money.usnews.com/money/retirement/iras/articles/a-guide-to-self-directed-iras.
Wondering why anyone bothers with dealing with those restrictions? Well, individual retirement arrangements come with certain tax benefits (depending on the type that you opt for, they may look different). This is a big deal for individual investors, seeing as there are exorbitant fees on most collectible purchases on a federal (and sometimes state) level.
Any way that we can make that less painful, we should certainly take advantage of. Again, I would say that you should shop for a broker carefully. Certain places are a bit “dodgier” than others and may not be as trustworthy as others. That is part of why I always check out the online reviews both from other consumers that are like me and from financial experts who
really know their stuff.
Projections for 2023
On a final note for today, let us briefly discuss some of the projections for the precious metals market as we enter the new year. For the most part, it is expected that they will stay around the same price over the next several months. There may be some fluctuations in prices (which pretty much always happens with commodities, even these), but on a larger scale, the value will probably not change too much.
Still, prices are rising right now because of how much inflation that we are seeing on a global scale. Seeing as gold is considered one of the best “hedges” against inflations (also known as a way to store your wealth without relying on paper currency), it is selling like hotcakes. Naturally, that increased demand means that folks will ask for more in return.
Even with that, though, now is hardly a bad time to start investing. If you have been uncertain about whether you want to or not, I understand. However, I hope that this article has helped to offer you some perspectives on why it could be beneficial to finally start investing in gold this quarter.