How Much Can I Invest?
This blog has been written in response to the major misconception about investing in Gold, which is that it’s “only for the rich”.
There’s no rulebook that says you must invest a specific amount. You can start off small by investing about £220 in a ¼ Gold Sovereign (October 2025) and if you want to spend less you can always look at silver where you can probably get a Britannia for around £50 (October 2025).
Buy whatever you’re comfortable with.
If you like it, you can build your position over time, if you don’t, you can simply sell it.
You don’t have to spend all your money day one.
What you do with it is very much up to you.
Although you can take delivery, I prefer to have mine stored and insured away from my house. I don’t want the hassle of having a safe or dealing with insurers. It’s a common misconception is that you have to take delivery, that’s simply not true. This blog on storing and insuring gold will shed some light on that.
Another consideration is the liquidity that it offers. Several dealers offer a service whereby you store and insure your gold with them (the cost can be as little as 0.3% per year) and when you sell, the proceeds go back into your bank account.
I find this is a very useful way of having cash outside may bank account (so I don’t spend it!), but highly liquid in case I need it.
If you’re investing for a particular reason – perhaps you feel gold can protect you from inflation – and that reason “goes away”, you can simply liquidate your holding.
Similarly, it can be a great way to diversify your portfolio, but later on you may decide that you would rather invest in something else, again, you can sell it. It’s very liquid. Gold is one of the few “global assets”, it’s not just considered valuable in the West, but across the World.
Here are a few other reasons behind why you may be thinking about getting some.
Try and protect yourself from market volatility
It’s a tangible asset that can’t be printed
Convert some cash into a highly liquid asset
I’m not sure how many gold dealers there are in the country, but what I am sure about is they’re not set up to open hundreds of accounts each day. So I would certainly suggest that you open up an account reasonably soon. Then at least it’s there if you need it. Imagine if everyone is clamouring to open a bullion account. That’s NOT a queue you want to be in.
It's worth noting that you don’t have to buy physical gold.
Given it is likely to cost in the region of 3-4% to buy it (you’ll pay this percentage over the spot price) and a similar percentage to sell it and you’ve also got storage and insurance costs which are probably in the region of 0.3% - 0.5%, I would not view it as a short term investment (this varies from person to person but let’s say less than a year).
If you hold it for a longer period, then these costs are obviously diluted and so I feel they’re much more reasonable.
If you’re looking for short term investment then you may find an ETF is suitable for you. But these vary enormously, so you need to make sure that it’s appropriate for you.
There’s also mining shares and gold backed crypto, but there’s a lot I can write on either of those, so I don’t want to get into them with this blog. All I would say is both are likely to have buying, selling and holding costs, so you need to make sure that they make sense considering both what else you have and also the time horizon you’re looking at holding them for.
Going back to physical Gold.
You may be wondering - What should I buy?
Although it really depends on WHY you want it, as a VERY general rule I’d say that
For gifting: smaller coins or bars are ideal.
For wealth preservation: A lot depends on what platform you are using. If it’s a pension, then you may want to think about some gold bullion (but you need to check with your pension provider first to make sure they find it acceptable). Should it be outside your pension then you may want to try and take advantage of any Capital Gains Tax benefits from certain gold coins. If it’s through an ISA then you can often buy company shares and funds, but you should speak with your broker before buying anything to make sure that it’s acceptable.
In all cases you should get some professional financial advice.
