Saving for a house deposit. Should I save in Cash or Gold?

[theylivewesleep27]

I have about 15k in savings which I'm saving for a deposit to buy a house in a few years. I was thinking about using that money to buy gold instead of having cash in the bank. Then wehn it comes time to buy a house i can sell it, and hopefully i will have made money if gold prices go higher. Any advice on what i should do? Buy the gold or just keep saving the cash?

[HerefordBullyun]

25 minutes ago, theylivewesleep27 said:

I have about 15k in savings which I'm saving for a deposit to buy a house in a few years. I was thinking about using that money to buy gold instead of having cash in the bank. Then wehn it comes time to buy a house i can sell it, and hopefully i will have made money if gold prices go higher. Any advice on what i should do? Buy the gold or just keep saving the cash?

I have a stocks and shares ISA. Because many standard ISAs are a c**p rate of interest. I am using it for the same. I play the stock market and go into mining stocks. Really bullish market for commodities. You will get a better rate of return but there is a but. Reaserch the stock. There is about 3 or 4 threads on stocks. But also be prepared to  be speculative enough to lose it. If you want one with decent rates and managed by professionals  vanguard do a good one. I only started this year but a couple of k up.

 

[HerefordBullyun]

Just now, HerefordBullyun said:

I have a stocks and shares ISA. Because many standard ISAs are a c**p rate of interest. I am using it for the same. I play the stock market and go into mining stocks. Really bullish market for commodities. You will get a better rate of return but there is a but. Reaserch the stock. There is about 3 or 4 threads on stocks. But also be prepared to  be speculative enough to lose it. If you want one with decent rates and managed by professionals Hargreaves landsdown do a good one. I only started this year but a couple of k up.

 

Edited to add I'm not a financial advisor this is not financial advise👍

[Shep]

Depends on your appetite for risk and when you intend to buy 🤷‍♂️. 

I’m not sure playing a short game with gold (2-5 years) is a good way of preserving wealth or “making money” as you put it. 

I try and go by the permanent portfolio of 25% cash, 25% bonds, 25% stocks (ISA) and 25% gold to try and even out the ebbs and flows of each. Not very exciting but it works well enough for me.

[sixgun]

Well don't save in cash unless you believe there will be deflation.
Physical gold - sovereigns - this is a good way. Gold is real money. i expect a repricing of gold and silver, so i think you will have more value than you started out with.

i would not recommend shares - we are in this scamdemic - companies are going bankrupt - stock prices are way over the top. i might suggest gold/ silver miners - i might recommend uranium in a little bit - i might recommend many commodities BUT this is your home deposit - i would say play safe and bung it into gold.
The issue will be when you need to liquidate it. You need to know how you are going to do this. You will have a decent stash and i wouldn't want to sell it to a dealer - i would for example build up a strong reputation here and sell through the Silver Forum. You can shift a lot of gold through the forum at a better price a dealer will give you.
If you have UK gold (or silver) coins you will not need to worry about capital gains under current legislation.

Personally i would use Kinesis (kinesis.money) at some point b/c ultimately i would be able to liquidate a gold investment however it big it might be at the click of a mouse. i would also be able to collect a yield on my gold. Kinesis is almost at a point i would strongly recommend it but not quite yet.

[silenceissilver]

22 minutes ago, sixgun said:

Well don't save in cash unless you believe there is be deflation.
Physical gold - sovereigns - this is a good way. Gold is real money. i expect a repricing of gold and silver, so i think you will have more value than you started out with.

i would not recommend shares - we are in this scamdemic - companies are going bankrupt - stock prices are way over the top. i might suggest gold/ silver miners - i might recommend uranium in a little bit - i might recommend many commodities BUT this is your home deposit - i would say play safe and bung it into gold.
The issue will be when you need to liquidate it. You need to know how you are going to do this. You will have a decent stash and i wouldn't want to sell it to a dealer - i would for example build up a strong reputation here and sell through the Silver Forum. You can shift a lot of gold through the forum at a better price a dealer will give you.
If you have UK gold (or silver) coins you will not need to worry about capital gains under current legislation.

Personally i would use Kinesis (kinesis.money) at some point b/c ultimately i would be able to liquidate a gold investment however it big it might be at the click of a mouse. i would also be able to collect a yield on my gold. Kinesis is almost at a point i would strongly recommend it but not quite yet.

I think we will see a short period of deflation before a hyperinflation. So, having a bit of cash is recommendable. But a bit, not the bulk of your positions, unless they are so small they you can just about cover 3 months of your daily expenses - which you should keep in cash.

Otherwise, I think saving in gold for property in a few years is a very good idea in the current situation. Houses are way overvalued, at some point they must come down whereas gold can be expected to go up in the next few years.

The average property in the UK (and all over the UK) compared to the average income - if you look at this ratio in the 1950s and in 2007 and compare the two ratios -then properties were 5 times more expensive in 2007, in this comparison. And certainly the gap has increased since 2007. How far can a balloon grow before it bursts?

Saving in cash or on a bank account - the printing press is running like crazy, so apart from keeping a small part for a brief but heavy deflationary phase, is a very bad idea.

 

 

[sixgun]

8 minutes ago, silenceissilver said:

I think we will see a short period of deflation before a hyperinflation. So, having a bit of cash is recommendable. But a bit, not the bulk of your positions, unless they are so small they you can just about cover 3 months of your daily expenses - which you should keep in cash.

Otherwise, I think saving in gold for property in a few years is a very good idea in the current situation. Houses are way overvalued, at some point they must come down whereas gold can be expected to go up in the next few years.

The average property in the UK (and all over the UK) compared to the average income - if you look at this ratio in the 1950s and in 2007 and compare the two ratios -then properties were 5 times more expensive in 2007, in this comparison. And certainly the gap has increased since 2007. How far can a balloon grow before it bursts?

Saving in cash or on a bank account - the printing press is running like crazy, so apart from keeping a small part for a brief but heavy deflationary phase, is a very bad idea.

Well this is why i mentioned planning how you would best be able to liquidate your gold savings. i do not see gold falling in price such that you would be in a worse position than saving in cash, well not in a time period of say more than 6 months.
If one were to accept that to be the case then gold is the better savings vehicle. The advantages of cash used to be you received a yield when on deposit (which you can all but say is now zero these days) - the other point is it is there for immediate deployment.
Now if you could save in gold and have it available to spend immediately then that would be better. If you could spend it in small amounts - £5, £10 sort of thing - better still. Have gold and collect a yield - this is supreme. This is the reason i mention Kinesis. Something the OP might care to look at, at some point. i mention Kinesis b/c i am involved and i feel it will be the best option in the future.

[silenceissilver]

4 minutes ago, sixgun said:

Well this is why i mentioned planning how you would best be able to liquidate your gold savings. i do not see gold falling in price such that you would be in a worse position than saving in cash, well not in a time period of say more than 6 months.
If one were to accept that to be the case then gold is the better savings vehicle. The advantages of cash used to be you received a yield when on deposit (which you can all but say is now zero these days) - the other point is it is there for immediate deployment.
Now if you could save in gold and have it available to spend immediately then that would be better. If you could spend it in small amounts - £5, £10 sort of thing - better still. Have gold and collect a yield - this is supreme. This is the reason i mention Kinesis. Something the OP might care to look at, at some point. i mention Kinesis b/c i am involved and i feel it will be the best option in the future.

I know you have mentioned Kinesis a few times. I have still not looked into it but I will. Sound interesting

[theylivewesleep27]

I just think this scamdemic will have an effect on our enonomy and with all the small bussiness goin extinct i think this could have an effect on our fake fiat money. I feel my money will always be safer in gold.

 

[FlorinCollector]

Depends on the risk you like to take. I wouldn't be risking the money I have for a home in any sort of investment. As I assume you will be looking to buy a house in the not too far future. 

[Roy]

With Joseph here, it's too short a timeframe.

You can make money easily if you have the flair for it.

Our @Paul once wrote a cracking thread on this. Buy mountain bikes and camper vans in the winter. Put some lipstick on them and sell in the summer etc.

Look for opportunities.

[Chorlton]

Any investment is a risk and you need to understand this and your exit strategy from the investment. If you invest in something that halves in value it would likely delay or alter your house purchase, the reverse is true if the investment went up in value significantly. Gains or losses from an investment are only realised when you cash them in. This is not financial advice just observations.

[Tn21]

£4k in liferime-isa.

£2k- £5k gold 

Rest in cash bank.

 

 

[theylivewesleep27]

Whats an ISA?

 

[Shep]

https://www.gov.uk/individual-savings-accounts

[Tn21]

32 minutes ago, theylivewesleep27 said:

Whats an ISA?

 

Lifetime ISA can be used for a deposit on a house. You can out a max of 4k in a l-isa and the gov will top.up 1k.

 

 

[theylivewesleep27]

Oh right. Yea i already have one of these.

 

[Swampy]

Asking investing advice is good, and having some skin in the game is even better!  

Buy an ounce (or two at most) if you fancy - you can see how it goes and if it interests you.  But hold the majority 11k + as cash for the moment.  You’ve learning to do, and you recognise that which is good.

Lifetime ISA - hit your 4K input every year as your priority so you get the max payout from gov. 

Key is, in my view, to start investing slowly and learn as you go.  It’s a lifetime journey not a get rich quick scheme.  I saved in a cash ISA and in premium bonds as my first investments for a property.  

Cash ISA’s now rubbish interest rates and the prizes on premium bonds have dropped. BUT, on both of these you are guaranteed the same amount of cash back.  Gold and stocks - you are not.  

I enjoy premium bonds - others will hate them!  

 

[silenceissilver]

I would rather have my dog watch a sausage than having a savings account that is heavily influenced by the government. I think all my scepticism about governments turned out to be true, in the last year.

If the government promises something - run!

[Wakey]

Like others have said max out your LISA each year first.

And as for the rest I'd just stick it in a Cash ISA/Savings account and not worry about it.

The stock market is at all time highs at the moment and if there is a crash would you be able to ride out the storm and put off buying a home for aslong as it takes to get your money back?

I'd suggest gold if your the type to keep dipping into your savings, away to put a barrier inbetween you and your cash. But you'v managed to save 15k so you seem to be doing fine as is.

[KDave]

LISA is a great idea. If I was doing it again I would use a LISA purely for the bonus towards a house,  what is it 25% bonus a year? Clearly that is going to be the best guaranteed return possible and massively beat inflation even if you just put cash in it. 

I would not use a LISA for retirement savings it is a trap imo when the SIPP is available. If you lose your job the state will count the LISA against your savings for benefits, making you withdraw the money from there first, which means paying back the bonus plus 5% I think, basically the government have made it that way so they can save on welfare costs and draw in a 5% tax from those who are capable and smart enough to save for their future but fall on hard times, its disgusting. A SIPP you don't have that problem as its not counted against assets and can't be touched until 57, though who knows one or both might change in the future.

But saving for a house, I would definitely use the LISA. Not advice of course. 

I would caution using gold for 'a few years', for gold short term is 10 years, medium and long term span multiple decades. It is capital in hand and tracks the general price level over time but that is only true over long time frames and gold has its cycles like other assets. The last bear market lasted 7 years. There are some strong indications that the top is in for metals, it could be 2008 top which recovered after a year or it could be 2011 top which as I say lasted 7 years, the question is do you feel lucky. Imagine coming back in 3 years time to buy your house and gold has not even bottomed yet 

Gold has its place over fiat for sure, fiat is not really a savings vehicle it is a medium of exchange, designed to lose value over time, 2% a year is the inflation target. In a LISA you can beat that by over 10 times but outside a LISA don't hold cash unless for emergency, to meet short term needs, to have some dry powder in the event of crash, etc, etc. It has its uses but its not a long term savings vehicle, its a claim on capital but not actual capital. Gold is capital in hand, it is purchasing power incarnate, but only over long periods of time. 

Its your money and future, do your due diligence, also don't take advice from internet forums. 

[SilverDrum]

Buy GOLD in the LISA? That's basically what everyone's saying right?! 🤣

PHAU WisdomTree Physical Gold ETC could be a good shout. 

[Swampy]

Would you Ladies and Gents leave cash in a current account or put it in premium bonds?  

[Shep]

Premium bonds for me. You can withdraw funds usually within about 3 day’s and it’s effectively entering a lottery every month where you get to keep your stake.

Current & savings accounts usually pay little or no interest, so the way I see it I might as well have the cash in something that might (however unlikely) win me a cash prize.

[silvernewbie]

Buying individual stocks for such a short time frame is too risky, and when you add in mining stocks just makes it even more volatile

i would buy diversified funds as the money printing will continue and stocks will keep getting inflated.  But keep an eye on the portfolio.  Otherwise 15k is a small amount just leave it in a savings account

gold you probably gain much and whilst i save in gold instead of cash now, i wouldnt have done so with a house deposit