Should you buy gold during a recession? How about afterward? Should you at all? Here’s what you need to know about investing in gold to prepare.
Preparing financially is the most important prepping you could ever do in life, except staying healthy. Investing is great as it gives us what Archimedes said so perfectly,
“Give me a lever long enough and I’ll move the world” – Archimedes
Investing gives us leverage over time, our most scarce resource. We can take the money we earn and invest it, like sending soldiers out to fight for us. But money doesn’t get tired like soldiers will. So where are we going to invest it?
In our last post, you learned 10 of the best uses for gold. In this financial preparedness guide, we talk about investing in gold during a recession for long-term financial survival.
Have you heard about what’s been happening in Venezuela? The United States is not immune to these events. They happened before. They will happen again. Only this time, it will be worse.
Investing In Gold and Recessions
Why is it good to buy gold in a recession? Partly, it’s because of what happens to gold prices in a recession. According to thebalance, when the economy crashed in 1929 which was the beginning of the Great Depression, investors started trading their paper currency for gold. So much that the U.S. Treasury became concerned that they might actually run out of the countries supply of gold.
This made them ask the Fed to raise the rates to slow down the rate of gold trading. The rising rates also caused a rise in the dollar’s worth. The dollar became more valuable than gold in 1931.
In 1933, gold became so valuable that it was prohibited to privately own gold. Sounds like something of immense value to have in a recession.
Gold is known to be a strong indicator of the overall health of an economy.
Prices before a recession tend to increase partly due to fear. For example, CNBC announced that gold prices just rose 1% a few days ago for this very reason.
Prices after a recession tend to increase, more than a little. The gold price during the recession of 2008 skyrocketed up to an all-time record high of 1,895 on Sept 5, 2011.
Prices after a recession tend to decline as the economy becomes more stable. Looking at the history of gold rates before, during, and after recessions tells us that the gold prices in the next recession will increase just like past recessions.
Golden Nuggets For Buying
Like most things, buying is the most important part. You make a return on your investment at the time of purchase. You make money when you buy, not when you sell. So buying correctly is crucial. If you get the buying process wrong, anything after that will sink into the red.
Here are four tips for buying gold. Not just for investing during a recession, but in general.
To clarify what I mean when I say “buy gold”. We’re talking physical gold. The yellowish and shiny metal that makes your soul warm and fuzzy when looking over a stockpile of it.
Does that mean you shouldn’t invest in the stock? Not at all. But if you do, then do both. Having a physical stockpile of real gold is what will save you in a crash.
What Kind To Buy
Bars and Coins.
Now that we’ve established we’re talking about buying physical gold. All forms of gold aren’t equal. All gold is not worth the same as “gold”. Buying the right form of gold is key. When you go to invest and purchase gold, buy gold bars and gold coins. Avoid jewelry.
Hide and Hush
Tell no one about your golden investment. Especially not your friends.
People care about themselves first, then other people. During a catastrophic event, survival instincts take over. Nothing else matters to the person but protecting themselves. This kicks into overdrive in a crisis.
People become ruthless and will do anything to protect themselves. That includes robbing their friends gold.
So get a little creative when you hide it. No wall safes or backyard burying, too obvious.
Tell your immediate family (if you trust them, some of my family I don’t trust) and no one else.
People seem to wander through their day without thinking about what they would do if the dollar collapses.
What would you do?
Investing in gold before, during, or after a recession is one of the few ways we can properly prepare financially for future economic collapses and crises.
Gold will be what you’ll need to buy food.
If you’re still wondering if buying gold is a good investment during a recession, hopefully, you got a few golden nuggets from this article.
Remember, learning how to prepare for the apocalypse can be done in two words. Buy Gold.
I hope this article on whether or not you should invest in gold during a recession helped you.
Have you invested yet?