The advantages and risks of saving gold

Gold Savings: The Advantages and Risks You Need to Know

Advantages and Risks of Gold Savings – Gold savings are a popular investment choice among millennials because they are considered a safe and profitable way to manage finances. 

However, before you decide to start saving gold, it is important to understand the advantages and risks that you need to consider. 

In this article, Whiz will discuss five advantages and five risks of gold savings that you need to know before you start investing in gold.

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Advantages and Risks of Gold Savings

Advantages of Gold Savings

The advantages and risks of saving gold
1. Resistant to Market Changes

Gold is known as an asset that is resistant to drastic market changes. When stock or currency markets experience instability, gold prices tend to remain strong or even increase, making it a good hedge against inflation or economic recession.

2. Prices are relatively stable

One of the advantages of gold savings is that the price of gold is relatively more stable. In contrast to other investments which may be susceptible to extreme market fluctuations, gold prices tend to be more stable and even tend to increase over time.

This makes gold savings an attractive option for those of you who want to look for assets that can provide value stability in the long term.

3. High Liquidity

One of the other advantages of gold savings is its high liquidity. Gold can be easily converted into cash at various places such as gold shops or financial institutions, so you can quickly access funds when you need them.

4. Can be used as collateral

The relatively stable price of gold means that gold can be used as collateral, you know. This is because the price of gold tends to be consistent and has an intrinsic value that is recognized globally, gold can be used as collateral for loans, credit or other financial transactions.

5. Easy Availability

Investing in gold is relatively easy to do because it is available in various forms, from gold bars to gold jewelry and even digital gold savings. This makes it a flexible choice for various types of investors.

So, those are some of the advantages of gold savings, but not only do they have advantages, investing in gold savings also has various risks. Let's look at the risks of gold savings below.

Risks of Gold Savings

1. Price Volatility

Although gold tends to be stable in the long term, gold prices can also experience significant volatility in the short term. Fluctuations in gold prices can affect the overall value of your investment.

2. Storage and Security Difficulties

Storing gold in physical form such as gold bars or jewelry can pose risks related to security and storage. You need to ensure that your gold is stored safely, either in a personal safe or at a trusted financial institution.

3. Additional Fees

Buying and selling physical gold often involves additional costs such as storage fees, insurance fees, and transaction fees. These costs can affect your investment results in the long term.

4. Does not generate passive income

Gold does not generate passive income like dividends or interest provided by stocks or bonds. As a result, you will not get a return on your investment apart from the increase in the price of gold itself.

5. Risks of Online Trading and Digital Investments

For those who choose to invest in digital gold or online gold savings, there are risks associated with the security and reliability of the platform. You need to choose a trusted and safe platform to carry out gold transactions online.

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So, those are the advantages and risks of saving gold. Even though gold savings offer attractive benefits, keep in mind that deposits are also an investment option worth considering, you know.

Compared to gold savings which have the risk of price fluctuations, deposits offer more stable and reliable profits over a certain period of time. So, apart from considering gold savings, you can also try deposit options such as Whiz Smart Saver. 

With Smart Saver you can get fixed interest of 6,75% and it's definitely safer because Whiz works with BPR which is guaranteed by LPS. Smart Saver can be an attractive choice to maximize fund growth and achieve your financial goals.