Savings In Gold

axlcinema

Hey there people, I'm thinking about starting some kind of retirement scheme. I was looking at keeping my savings in Gold, maybe using bullionvault.com or goldmoney.com I've heard bad things about pension schemes and don't have a whole lot of trust in a savings account as currencies can turn bad, right ?
I think it would be safer to buy actual Gold bullion bars, does any one have any views or suggestions on this. Also I'm 24 years old, what is the right time to start saving for retirement ?

Mort5000

Hi Axl,

I would say that this may be a safe strategy to hedge your money short term. That is, gold is perceived to be 'safe' right now during a recession.

Long term I think regular pensions would absolutely murder your gold investment on performance.
Even a well diversified investment portfolio should beat a 'gold only' portfolio long term.

I think with investing, you should always try diversify to ease your risk as much as possible.

"what is the right time to start saving for retirement" <- as soon as you possibly can. The more you have saved, the higher the quality of life when you retire.

Don't forget that there are tax perks for contributing to PRSAs out of your salary. Check with a regular advisor / tax person about those.

As you are only 24, I'd say that you could follow the high risk strategies right now, and then move more conservative as you get older.
That said, I wouldn't rely on a gold only fund to get you all the way to, lets be honest here, your final breath.

What bad things have you heard about pension schemes?
In what way do you think savings schemes and currencies are related?

axlcinema

Now please correct me if i'm wrong on any of my points.


1. What bad things have you heard about pension schemes?

Now correct me if i'm wrong on any of my points please. I've heard from older people who payed into pension plans in companies and then these companies went broke and well - no pension. Can this happen ?

2. In what way do you think savings schemes and currencies are related?

The way i'm looking at it, is if you keep a savings account and inflation goes out of control in the future then the money you worked for may as well be plain paper. The thing that is attracting to me to gold is, even though you don't gain anything, it doesn't really lose any value, unlike money which can inflate and deflate right ?

woodseb

axlcinema wrote: »

Now please correct me if i'm wrong on any of my points.


1. What bad things have you heard about pension schemes?

Now correct me if i'm wrong on any of my points please. I've heard from older people who payed into pension plans in companies and then these companies went broke and well - no pension. Can this happen ?

This happened in defined benefit pension schemes where the company had to maintain a fund to pay employees when they retire. These are extremely rare in the private sector now and if you are discussing where to place your pension you have defined contribution which are administered outside the company and wont go bust.

2. In what way do you think savings schemes and currencies are related?

The way i'm looking at it, is if you keep a savings account and inflation goes out of control in the future then the money you worked for may as well be plain paper. The thing that is attracting to me to gold is, even though you don't gain anything, it doesn't really lose any value, unlike money which can inflate and deflate right ?

Gold prices move up and down too, you may have certainty that it will still have value in an armageddon scenario but it is not a good inflation hedge.

you should get some professional advice. Putting everything in gold in not advisable for someone so far away from retirement

samson09

In the past nothing has proven to be better than gold as a hedge against inflation. Also, gold always holds it purchasing power over time. IMO, it would be a good idea to start accumulating gold (physical or with one of the companies you mentioned) slowly, puchasing every so often on price dips. Keep in mind that gold will only preserve the wealth you have and generally will not increase wealth. If your looking to make some money, perhaps you should look into buying stock in alternative energy companies, gold mining companies and maybe even throw a few grand into bank shares when they revisit their lows again.

axlcinema

Thanks for the advice folks, please keep it coming.