Advice to Investors Who are Tired of Watching Their Portfolios Decline Due to Inflation and the Current Administration’s Economic Bungling
Does Your Portfolio Statement Look Like the One in the Image Below? If So, Here is How to Fix the Problem
By Tony Comerford
Tony Comerford is a finance writer and investment researcher.
How is the 8% inflation rate we are currently experiencing affecting you? Here is an image of the summary portion of an investment brokerage account for the month of January and February 2022.
Notice the net change in the portfolio value for the months of January and February? That’s right, they are both in the negative. This change is primarily due to the current administration’s ridiculous policies, especially the policies regarding energy.
I am sure your portfolio looks something like this also.
How can we combat rising inflation and plummeting stock portfolios?
In my opinion, the two images below provide the most compelling reason to include gold and precious metals in your investment portfolio, whether it is through a 401k to gold IRA rollover, or by simply purchasing and holding physical precious metal assets.
The charts show a comparison between the value of the dollar and the value of gold during the same time period between 2002 and 2008 which was the beginning and the period through the last big recession during the bursting of the real estate bubble.
It is plain to see that the value of the dollar dropped drastically while the value of gold rose drastically.
If you owned gold in your investment portfolio you would have been hedged against the decline of the dollar because as the dollar fell, the price of gold rose to fill the gap and absorb the loss.
Need more recent proof?
Here is another chart that shows the dollars relation to gold during the height of the recent COVID-19 pandemic:
You can clearly see that the value of the US Dollar dropped drastically in sharp contrast to the value of both gold and silver!
If you held gold in your portfolio, you would have been hedged against the value of the dollar.
By Including Gold in Your Investment Portfolio, You are protecting your investments With a Hedge.
According to millionaire financial expert and analyst, Peter Schiff, both gold and the US Dollar work hand in hand.
So, when the dollar increases in strength, gold prices begin to take a tumble, and “when the dollar plummets, gold prices begin to take flight”.
You can use this dollar/gold relationship to protect yourself against losses in mutual fund investments, and traditional stock-based IRA accounts.
Gold is also a very effective if not the perfect way to preserve wealth and ascertain that it gets passed down from generation to generation.
And once you successfully incorporate a core holding of gold bullion into your investment portfolio then different but relevant investments like those in mutual funds and mining stocks as well as a variety of speculative and critical gold investment options can be taken into account.
So, In my opinion, gold bullion should either be in your personal possession or given to a third party for secure storage
What is the Best Way to Harness the Power of Gold to hedge Your Portfolio Against Inflation?
There are many different ways to become an owner of gold. You can buy physical gold (including gold coins), gold ETFs (Stocks basically), and gold mutual funds.
But perhaps the best way for most of us to buy gold is to use the existing funds in our IRA or 401k by rolling all or a portion of it into a gold IRA/401k rollover.
What is a Gold-Backed IRA or 401k to gold IRA rollover?
1. A Gold Backed IRA
First, a gold-backed IRA is a method of retirement investing that is approved by the IRS. A Gold IRA is a Self-Directed Individual Retirement Account that allows you to safely own physical precious metals in a tax-deferred account.
Instead of containing investments in stock, bonds, or mutual funds like a traditional IRA, a precious metals IRA allows you to purchase gold and other precious metals with pre-tax money and receive the same tax advantages that you would in your regular retirement account.
2. A Gold Backed 401k
A 401k to gold IRA rollover is a Self-Directed Individual Retirement Account that allows you to roll an existing 401k into an account that allows you to physically own precious metals such as gold, silver, platinum, and palladium tax-deferred.
These precious metals IRA accounts are not associated with stocks and bonds like traditional IRA’s but instead contain physical assets inside of the portfolio.
Whether you choose gold, silver, platinum, or palladium, your metals are stored on your behalf in a secure IRS-approved depository until the time of your retirement.
A gold-backed IRA along with a traditional IRA allows you to hedge against inflation and mitigate losses in the event of an economic downturn.
So How Do I Make This Happen?
Well, it is really easy. Here are the steps to initiate a gold-backed IRA and start hedging your portfolio against inflation.
1. First, you need to find a reputable IRA custodian that will handle your transaction safely and professionally.
I recommend Goldco Direct. Why? because I have a relationship with this company and I know they know what they are doing. They are rated A+ by the Better Business Bureau and Triple-A by Business Consumer Alliance and they can handle every step of the process for setting up your inflation-fighting gold investment account whether it’s an IRA, 401(k), 403(b), TSP, savings or similar tax-advantaged retirement account.
Goldco has a great kit that will educate you on all of the ins and outs of protecting your assets with the power of gold. You can get a copy by visiting the link below.
2. Open your account
Your custodian will help you open your tax-deferred Gold IRA account, this process is usually complete within 24 hours of submitting your application. The application requires some basic information, a couple of signatures-no big deal.
3. Transfer the amount of funds you would like to invest into your new gold-backed, tax-deferred IRA account.
Here is where (in my opinion) Goldco Direct really stands out from other gold IRA custodians. You see, most other gold investment firms will encourage you to put all of your retirement funds into gold. This is because the more money they administer, the more fees they collect. This completely defeats the whole concept of diversification! Goldco Direct does not recommend that you transfer all of your assets into gold, but instead recommends that you place a portion in gold for the purpose of hedging through a diversified portfolio.
This level of honesty and transparency is why I like and recommend this company for investing in gold. They want what’s right for you.
After that is is just like any other account, you will receive quarterly statements and you will have access via the internet 24/7.
Want more info?
The best thing I can recommend is to get the kit. It won’t cost you anything (including shipping) and you can read and learn about this great asset protection tool at your leisure.