No, no, no!
Don’t.
Stop it!
Al Bundy gives some great advice here:
If you can’t watch the clip, here’s the quote:
All kidding aside, run. Run hard, run now, run silent, run deep, run like Mexican water through a first-time tourist, but the key word here is “run!”
Should I Buy Gold Coins?
In case you missed the answer in the previous section, the answer is NO!
I’ve thought about writing this for some time. However, I figured that none of my readers would be caught by the gold coin or gold IRA trap. Hopefully, none of you have.
The Washington Post has a very good article (alas, paywall) about gold IRAs and the conservative media.
If you don’t have a subscription or just don’t want to read it, here’s my brief synopsis:
If you’ve watched any of the conservative television shows, you’ll see old network hosts make a political argument that the world is ending (or at least the financial world is ending. According to the commercial, gold is the way to protect your money. (We know it is advertising, right?)
When you look under the surface of what the companies are selling, they take a large percentage of the money for themselves. You get a little gold in return. Gold prices are almost at the high that they were in 1981. That’s not a good return on 40+ years of investing. If you managed to buy low, you might make a little profit, but we know that diversified corporate stocks and bonds have historically done much, much better.
The strange thing is that you rarely see these types of ads anywhere else. You won’t see Hulu ad-supported commercials for these gold IRA companies. They aren’t mainstream or liberal cable news networks. They aren’t on ABC, CBS, or NBC. The commercials and companies seem to be designed to take advantage of one audience and their fear, uncertainty, and doubt (often abbreviated FUD).
There are another couple of places where you’ll see these kinds of advertisements. You may see them on my site, as I don’t control the advertising. I saw an ad in Kiplinger Personal Finance magazine this month. They’ve openly stated how difficult print media is when it comes to financial information. Most of the information is months behind schedule due to the lead time they require to print all the magazines. I can imagine that they may have to take subpar advertisers just to deliver the great content that they do.
Finally, some bloggers will take money for sponsored posts like this. In that case, the article was kind of neutral but said that the fees were low, that there are pricing mark-ups, and pricing data is not listed on the website. It also implies Consumer Affairs is a reputable review site, which it is not.
Let me get back to the main point. The Washington Post article found several conservatives who have lost a large chunk of their retirement savings. They trusted the spokespeople.
So stay away. Don’t get scammed by the gold sellers!
Great article. FUD really seems to sell in certain media, and as you know you can generally tell who is listening because they parrot the same comments.
Always amazed when people fall for that type of scam. Always disgusted by the “celebrities” who endorse those scams.
In our culture, gold is a form of wealth storage. It’s portable and when SHTF you can take it. It has proven useful in our family history. But life is more stable for us now so we probably won’t need it. The stock market is a much better investment, for sure.
I don’t have any gold. Mrs. RB40 has a couple of rings that aren’t worth that much.
I’ve always thought that those days are gone. When the SHTF, gold is mostly useless – it has a very low intrinsic value. For example, the people in the Maui wildfires may have had to leave their gold behind, but their mutual funds are still fine.