Dave Ramsey – Should You Invest in Gold?
Dave Ramsey is an American financial personality and personal finance expert known for teaching people how to make wise financial decisions. His advice has helped millions of Americans get out of debt and save for the future.
Many of his listeners have asked whether he advises investing in gold. Unfortunately, his response often emphasizes its illiquid nature and should be avoided altogether.
History
Since ancient times, precious metals have been highly prized and prized commodities. Gold has long been used in coins, bullion and jewellery; its value also serves as an effective hedge against inflation.
Personal finance expert Dave Ramsey has issued numerous warnings against investing in gold. According to one of his articles, owning it could mean flushing money down the toilet should the dollar take a nosedive.
He bases this statement on the fact that President Nixon ended the government’s practice of exchanging dollars for gold in 1971, meaning it’s impossible for anyone to bring dollars to the government and receive gold back as payment. Yet many still view gold as an attractive investment because unlike stocks and equities, gold has proven its ability to protect against inflation over time while being less volatile than other commodities.
Taxes
Dave Ramsey is a self-made multimillionaire known for using Christian principles to spread financial wisdom. With a popular radio show and best-selling books under his belt, his advice is utilized by millions worldwide. Since 1992 he has started his company to assist those looking to regain control of their finances and live debt-free lives.
He offers practical financial guidance through books, podcasts and the Financial Peace University course. His methods utilize personal experience as well as biblical scriptures to impart sound money management practices.
Gold has long been seen as a safe haven investment during times of economic instability, thanks to its rarity and ability to maintain its value. Investors purchase it to diversify their portfolios. Gold can also be used in jewelry making or as an store of wealth; governments and central banks may stockpile gold as currency; its widespread usage throughout modern society attests to this fact.
Emotional connection
Gold has long been associated with wealth. An inedible metal, its value rests with society rather than individual ownership. While production may not be readily available for all uses as currency, its noncorrodible nature makes it ideal as currency to exchange goods and services.
However, it’s essential to remain cognizant of the emotional connection gold can have on individuals. Gold may cause some to develop an exaggerated sense of self-worth or superiority that leads to feelings of stress, anxiety or overwhelm.
Ultimately, investment decisions involving precious metals should be guided by sound judgment and facts. Do your research on an investment type’s past performance, its current emotional climate and what you can learn about them from their history and current standing. Avoid making financial decisions based on fear and greed alone – instead invest in things with potential to appreciate over time such as real estate and 401ks.
Diversification
As with any investment decision, it’s vital to conduct extensive research and seek professional advice before making your own investment decisions. When it comes to gold investments specifically, be mindful that price fluctuations often depend on emotion rather than facts – although myth has it that gold acts as the primary medium of exchange during economic crises; that has never been proven true in reality.
Instead, diversify your portfolio with investments that offer long-term returns, so if one investment disappoints it won’t have such an adverse effect on overall return.
As a personal finance expert, Ramsey has made a name for himself by helping people get out of debt and build wealth. While he may not specialize in precious metals like gold investing, following his advice can still prove helpful for many individuals. By following his tips instead of investing in gold you could find safer methods of growing your money that allow less worrying about its price and more on building equity in your home or growing your 401(k).
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