Even when the rest of the world’s economy is starting to decline, gold still prospers. Therefore, more and more people are thinking about investing some of their hard earned savings into the gold industry. But what kind of gold is best? How much of your money should you put aside? We’ll answer all these questions and more to give you the best tips on how to invest in gold.

Tips for Investing in Gold

Gold can be a good long term investment if you buy in when prices decrease and then sell when there is a nice profit. In other words, wait until investors aren’t concerned about the price of gold increasing and then hold on to it.

• Decide how much of your portfolio you’ll devote to gold. Many first-time investors usually set aside around 5 to 15 percent of their investment portfolio for gold, while long time investors recommend up to 20 percent.

• Determining your reason for buying gold will help you decide what kind of gold will best suit your needs. If you’re just trying to aid financial uncertainty, you’re probably fine with some modern gold coins. However if you wish to take it further, you have options of historic coins, gold shares and certificates, and gold stocks.

• Buy the right kind of gold coins. Invest in 1-ounce coins as they’re easier to both buy and sell. Stick to well-known coins like the 24-karat Canadian Maple Leaf coin as these are easier to sell than less well-known coins. Modern coins are bought more for their weight in gold and that money value is kept in case of an emergency, while rare or historical coins are favoured because of certain details or stories.

• Try to buy gold as close to its spot price as possible. For example, if you bought a gold coin for $1,335 and the spot price was actually $1,300, you would figure out that the premium is 2.6 by subtracting the spot price from your price, and then dividing it by the spot price and multiplying by 100. This shows that that the price of gold only has to grow around 2.6 percent for you to make a profit.

• Invest in other forms of gold like gold exchange traded funds or gold stocks.  This allows you to buy 1/10 of an ounce of gold for each share you own.

When you are ready to buy or sell gold, remember to select a reputable dealer and to check that they are not selling it at more than a 4-5 percent premium. Otherwise, you’ll never see your profit back.