Approximately 2,600 tons of gold are mined each year. Some of this gold is destined for industrial use and some is even destroyed in the process of refining and/or manufacturing products. The vast majority, however, is used for investment purposes. Banks and national reserves take delivery of countless 400 and 1000-ounce bars each year. Organizations such as the US Mint and the Royal Canadian Mint produce hundreds of millions of gold bullion coins each year. Individuals in the United States, China and India buy massive amounts of gold bullion for personal use. Why is buying gold bullion such a popular decision? Should you buy gold bullion? Why or why not?

American household investors buy gold bullion for a number of reasons. Many people feel the need to hedge against losses in their stocks. Others feel that gold is a good way to combat inflation of the dollar. Some investors buy gold bullion for diversification purposes. Knowing why you want to buy gold bullion can help you choose the product(s) that will best meet your needs.

Who buys gold bullion bars?

Investors who buy gold bullion for retirement account purposes tend to prefer bars over coins. Bars are more cost effective and they cost less to store in a depository because they are standardized and do not have different values based on production date, mint marks, etc. The sole exception to this rule would be for individuals who want a non-confiscatable type of gold; in the event of a gold bullion confiscation bars would provide clients’ with no protection whatsoever.

Who buys gold bullion coins?

Some investors prefer currency-denominated coinage to bars. These investors purchase coins as a means to prepare for a post-dollar-collapse economy. The chance of our government standing idly by as the dollar disappeared is slim-to-none, but those who believe that this scenario will come to pass often pack their portfolio with fractional gold bullion coins. Potential gold investors should understand that gold bullion coins have a higher premium than bars on the front end, but most gold dealers pay the same amount (spot price) for gold bullion coins and bars alike.

Why buy gold bullion?

Gold bullion is an excellent way to store large amounts of wealth. Investors who know how to time the gold spot price make lots of money by completing multiple buys and sells each year. Gold bullion allows its owners to avoid the liabilities of cash and other paper-based assets. However, there are risks associated with gold bullion ownership that you may not be aware of, and for many people bullion is not the most advantageous form of gold to own. Contact Certified Gold Exchange today at 1-800-300-0715 to claim your free copy of our new 2015 Insider’s Guide to Gold Investing and find out if buying gold bullion is the right choice for you.