Buying gold is becoming increasingly popular. Why investing in gold is a rewarding undertaking for long-term investors.
Investing money in gold is becoming more and more interesting for many people. A study found that individuals in Germany own over 8,900 tons of precious metal. But why is it so popular? Three reasons to invest in gold!
Security in times of crisis
For many people, gold is a hedge of wealth. While capital loss is often threatened by government currencies and speculation in equities is often a rewarding but complex and risky asset, physical gold offers the advantage of a tangible counterpart. Gold has proven itself for thousands of years as a means of exchange and payment. In addition, the price has fluctuated only slightly in recent years. If crises occur, investors will still have a stable currency with gold – regardless of governments or banks.
The fact that there is an abrupt major loss of value in gold, is considered very unlikely. The already very high production costs of gold speak against it. Due to the stable price, the risk for investors is comparatively low. Moreover, those who are afraid of future crises or a currency crash and the associated total loss of funds can convert part of their assets into physical gold. Not least due to the worldwide limited reserves of reserves, the precious metal always retains its value. Because unlike state currency, it can not be endlessly proliferated.
In addition to security, the precious metal offers another advantage: tax exemption. Under certain conditions, since 1993 the investment in physical gold has been exempt from both VAT and withholding tax as well as income tax. From a holding period of 12 months, the price gained is tax-free.