Is gold the best option?

principa

sabretoothtigger wrote: »

Most people don't have savings, they have debt and a bit of liquidity between pay cheques and the mortgage payment. Basically they are debtors not savers.
In UK that is most of us.

This is a very good point - why invest at all if you are in debt? Every time I buy something for a £1, because I have a mortgage it is actually costing £1.20 or thereabouts.

If I was stupid enough to buy £1000 in gold I would immediately take a £150 hit.

atush

3) They only seem to be prepared to invest in gold or cash, given the circumstances, could you tell me what you would suggest o wise one that's so much better ?

I would suggest, that the vulnerable person with mental heath issues have a legal guardian appointed to deal with their financial matters. Help getting this done, is what needs to happen here, not advising investing solutions.

atush

Yes, I read it. did you? Did you read the post where the OP admits they have mental health issues or not?

padington

atush wrote: »

Yes, I read it. did you? Did you read the post where the OP admits they have mental health issues or not?

Everyone has mental health issues to some degree now and again but the idea of sectioning their finances to invest in ways they are not comfortable with especially when they can clearly hold a down a job is simply laughable.

atush

this person is hoarding cash in their home. Which could burn down, be burgled etc.

Because of an irrational fear of Banks. When there are other savings institutions out there that ARE NOT banks from credit unions, to mutuals like Building societies to National savings. To the fact you'd need more than 85K in any bank to stand a chance at losing the money.

This isn't a difficult concept to grasp, and any paranoia above this threshold is quite severe.

I am quite surprised the individual in question can hold down a paying job, are we certain the money is earned income? Or could it come from trusts and the state?

In any case, telling them to hold gold in their home is ridiculous and unsafe.

vx220fan

I can't offer much advice but I can contribute some on-topic discussion.

I've also thought about investing in gold simply as a 'fun' way to diversify my portfolio.

Gold purchases are VAT free unlike silver, and gold coins (British legal tender such as sovereigns) are capital gains tax exempt unlike gold bars. This means there's no overhead in buying or selling the gold. Contrast this to a second home, for example, where there's the stamp duty when buying and capital gains tax when selling (subject to purchase price, CGT allowance etc).

A couple of serious considerations to note:

Like any non-cash investment, the value can go down as well as up. Your friend might do incredibly well out of gold, but on the other hand might lose out. Or remain neutral. Note the value of gold is often (but not always) the inverse of the strength of the US dollar.

It's a good idea to ensure the gold is kept safe. Stuffing it in the back of a sock draw might keep it out of sight of a burglar but won't help much in the event of a fire. My plan is to research safety deposit boxes but I have no idea how they work. Does the bank insure their contents? Do I have access if I need it? What is the rental charge? I can't answer any of these questions but you might want to investigate on behalf of your friend/colleague.

Andrew.

padington

atush wrote: »

In any case, telling them to hold gold in their home is ridiculous and unsafe.

Wrong again, at no point did I suggest that. I suggested they place some of their wealth into a vault with bullionvault.

Now stop embarrassing your self, atush and pipe down, I gave reasonable advice for someone who is paranoid about counter party risk which is a reasonable fear given the euro / Cyprus savings situation regarding money in banks or building societies because uniquely your savings remain in your ownership in bullionvault, even though its in their vault and you can't lose even if they go bankrupt, whilst it doesn't come on the radar because its not a bank account.

(for the poster above - its also interesting to note they offer a tax exemption for silver because the customers don't take delivery themselves ).

in terms of counter party risk it's safer than keeping cash or gold at home and safer and cheaper than keeping cash or gold in the bank for ammounts over 85k if in the uk. Pretty decent advice if you ask me.

PS I am nothing to do with bullionvault, I just think they offer a brilliant savings solution for anyone who thinks gold is going to have a good future and wants to keep their savings lock down safe in a way not many others offer and think they are a great British company that deserves to be better known about and they fit the bill well with the concerns that this person is having, which I personally think are very valid concerns to have indeed.

atush

Why would they trust Bullion Vault, when they won't trust a bank? That is Super counter party risk.


you are quite frankly off topic and a little (metal) crazy. I hold gold, bought at great prices years ago. I hold silver.

Would not buy either now and despite my experience would never advise a vulnerable person to do so. Why not put a big post it note or tatoo their head- ROB ME NOW?

Really just stop, think, and hang your head in shame.

Go back to advising precious metals to first time investors of sound mind at least.

vx220fan

padington wrote: »

(for the poster above - its also interesting to note they offer a tax exemption for silver because the customers don't take delivery themselves ).

The original issue requires taking delivery of the commodity. Sorry if I've misunderstood your original question.

gadgetmind

padington wrote: »

uniquely your savings remain in your ownership in bullionvault, even though its in their vault and you can't lose

Sorry, but that's just denial. The money in Cyprus banks also remains the property of the depositors but the government has levied a tax against it. Any government could do exactly the same to hoarded gold.

Also bear in mind that saying "Hey, that was my gold!" does no good if the vault is found to be empty when opened.

At least deposits up to €100k have some security and look like they'll even survive in Cyprus, though liquidity might be limited.

The advice for the person in question to seek help from a mental health professional is sound as is the advice for them to seriously consider putting their finances in the hands of someone else until they are thinking more rationally.