Would it be better to start buying small amounts of gold rather than invest money in a pension fund?
2006-11-01 00:50:30 · 5 answers · asked by popeye 1 in Business & Finance ➔ Personal Finance
I'd suggest that you do both.
A pension fund is insurance, and it will pay off if the economy remains prosperous. Gold is insurance, and it will pay off if the economy goes into the toilet.
Think about it. The Federal Government spent $620 billion more, last year, than it took in. The only way that massive hole in the budget can be plugged is to close down Department after Department, in the Executive Branch, or to raise taxes to the tune of $2,000 or more for every person in the country. If neither option is exercised, the dollar will have to lose value. That's just the way it is. And if the dollar loses value, then whatever you have in savings will also lose value. It's called inflation, and it is a killer of wealth.
Gold is a hedge against inflation. If inflation is high, the price of gold goes up, maintaining the security of your savings.
The price of gold didn't start going down, in the 80s, until the Government proved that it was serious about fighting inflation, and maintaining some sort of stability in the value of the dollar. The price of gold is going up, now, because the Government has proved that it doesn't give a damn about the value of the dollar. Inflation is already raging at a rate higher than it was, when Nixon initiated his failed attempt to control wages and prices, in the 70s.
The way I look at it, inflation will eat away at the savings you've invested in your pension fund. That's why I'd recommend buying gold bullion. But, on the off chance that we manage to muddle through, somehow, due to some sort of divine intervention, I'd keep contributing to my pension plan, too.
Look at the price that you think gold will achieve, in the next few years. How many ounces of gold will you have to own, at that price, in order to be able to pay off your house? I'd suggest that you find a way to accumulate that many ounces of gold.
Of course, there's always the risk of a second gold confiscation, in the US. They did it before, and they can do it again. Beware.
2006-11-01 05:53:35 · answer #1 · answered by Larry Powers 3 · 0⤊ 0⤋
A pension fund has some sort of guarantee with it, gold does not. Although gold has shown excellent returns for now, what will happen in the future. Gold went up several decades ago, and then the bottom fell out, dropping 100s of dollars. Only in the last few years has it gone back up.
2006-11-01 01:01:32 · answer #2 · answered by words_smith_4u 6 · 1⤊ 0⤋
invest in a good pension fund
2006-11-01 00:52:16 · answer #3 · answered by Mary Smith 6 · 0⤊ 0⤋
It is not time for gold you missed the gold boat. It took of a few years ago.
2006-11-01 02:22:52 · answer #4 · answered by Anonymous · 0⤊ 0⤋
Pension without any doubt.
2006-11-01 04:09:08 · answer #5 · answered by waggy_33 6 · 0⤊ 0⤋