I am absolutely fed up with all the advertisements on the air telling you now is the time to buy gold. Everyone out there is telling you it’s the smart thing to do. “Gold has never been higher!” “Get in while you still can!” “Gold is yielding record returns!”
Well that’s exactly the problem. Gold is indeed at an all-time high. So why would you buy it? Why would you speculate on an investment that costs you more to purchase than ever before and has never been sold higher than what it is now? It seems to me the fundamentals of investing have always been to buy low and sell high, yet we have tons of people flocking to buy gold at the highest price in history. At least that’s what the commercials tell you.
Even worse, celebrities are jumping on the bandwagon to sell this faulty concept to you. They’re telling you how gold will hedge inflation. They’re talking about how gold will be the only currency when the economy fails. They are preying on our fears in order to make more money. These advertisements are just simply advertisements. They’re preying on senior citizens who are fearful of the stock market after the 2008 crash. These are people who lost a lot of money by listening to the pundits on tv saying they needed to sell out to save their portfolios. So when they sold they locked in their losses and now their retirement account balances are too low because they were afraid to get back into the market. Now they are looking for a quick hit to restore their retirement accounts. The problem is, there is no getting rich quickly. Especially in gold. Buying gold now at record high prices is setting yourself up for failure and loss when the prices tank.
The truth about gold is this: you shouldn’t be buying gold in a bad economy. If I were to recommend buying gold at all, it would be in a good economy when prices are low. Then you would have gold on hand to sell when the economy slows and gold prices rise. I know, that’s exactly opposite of what everyone else is saying right now. But that’s the way to make the most money in investing.
If you truly want to experience living in financial excellence, don’t make your investing decisions based on tv or radio advertisements. In fact, your best bet may be to do the exact opposite of what the masses are telling you to do. If the general population says it’s a good idea, you know it’s really a bad idea. Hey, the general population says debt is a tool and look where that got them. Deeper in debt and stuck in a financial crisis caused by over-borrowing. Yes, Virginia, buying gold in today’s economy is a really bad idea.Matt Wegner is a personal finance, small business and leadership coach focused on teaching his clients the tools for L.I.F.E. (Living In Financial Excellence). Want to learn how to invest without the pressure to buy investments? Apply today for a free planning session with Matt or visit financialexcellence.net.