Gold, Silver, Stocks, Cash or Equities?

[ZRPMs]

Hi Folks. 

I realise its a very broad question and one that has a very individual answer really but I find myself in a position where I need to think about a home for some funds having recently sold a property. Having cashed out of the property I have now lost the income generated from the rental. Whilst I don't need to match or find a greater rate of income. It would be prudent to invest at least some into an income generating investment. I would also like to add a bit of gold in the form of some Sovereign's and/ or Britannia's. I'm on the fence a little when it comes to silver. So, my multi part question is. What are peoples thoughts on the price of gold and silver in the near future? As we close out 2022 what is the likely direction for 2023? Is it better to wait a little for a slump in the new year or are we looking at a strong physical market price and will we get to £3,000 an ounce as a few have been saying to me. Trying to invoke the FOMO. 

I would like to get a batch of 100 sovereign or 25 Britannia's. I have noticed as well a reduced amount of the coins available at most of the usual places. I will give an update on which way I eventually go. 

Kind regards 

[honestinjun]

As I mentioned in an earlier post there is a massive disconnect between the 'spot' price and physical gold - coins in particular - they may as well be two different entities.

Waiting for the spot to drop in order to pick up some bargain bullion is a fools game. Any physical (coins in particular) that comes near spot is getting grabbed. Why? Because peopled are cottoning on to the worthless fiat currency (not money) that we are awash with. Physical gold/property is the only real store of value. Make of that what you will.

[Pete]

Depending on your age, when you are likely to retire, other assets and the amount of money you are wanting to invest here are my suggestion -

1. Pay off any debt that charges interest higher than you can get for depositing cash in a bank savings account.

2. If you have a mortgage and if the worst happened and you could loose your house then maybe pay off some of the loan.

3. If you are a tax payer then consider paying money into a SIPP and get full tax credit into your SIPP.
This assumes you are not wanting to use SIPP money until aged 55+
Ignoring the tax relief offered is a big mistake.
Use your SIPP money to buy UK Equity Growth Funds that are always hot on the list of financial advisors with billions in value.

4. Ensure you have adequate cash to cover living expenses for at least 6 months and keep this cash in an ISA.

5. Finally if there is anything left over buy gold at as close to spot as you can find but generally 3% or less if you can find any.
It doesn't really matter whether you buy Krugerands, Maples, Britannia etc just look for 24ct rather than 22ct.
Sovereigns are extremely popular and easy to sell above spot but you pay over spot for them so if you see a bargain then go for it.

6. There is no harm in buying silver so all the popular coins and bars come to mind but selling to a bullion dealer will only get you close to spot but buying silver cost 20% more due to the VAT. You can ignore the VAT selling privately where you will pay more than spot + premium but sell for spot + premium with VAT equivalent included both buying and selling i.e. built-in to the price. Some stackers reckon silver has much more potential upside because compared to gold it is seen as cheap but that's been the story for many years now.

7. Gold definitely seems to win out BUT..BUT.. no-one can predict the future price and even though it is easily traded with small margins, you are speculating that the price will rise. There are as many "experts" believing gold will rise as fall but hopefully over the longer term ( i.e. decades ) as a minimum it will retain its original value whilst fiat currencies through inflation and QE will depreciate significantly.

8. Remember the wise advice of DIVERSIFY and don't put all your eggs in one basket.

Please note that I am not a financial advisor or qualified to give advice, just an ordinary forum member who has seen and experienced good and bad in a wide variety of sectors & investments over the years and just willing to share my personal views hoping it can help others.

[LawrenceChard]

12 hours ago, ZRPMs said:

Hi Folks. 

I realise its a very broad question and one that has a very individual answer really but I find myself in a position where I need to think about a home for some funds having recently sold a property. Having cashed out of the property I have now lost the income generated from the rental. Whilst I don't need to match or find a greater rate of income. It would be prudent to invest at least some into an income generating investment. I would also like to add a bit of gold in the form of some Sovereign's and/ or Britannia's. I'm on the fence a little when it comes to silver. So, my multi part question is. What are peoples thoughts on the price of gold and silver in the near future? As we close out 2022 what is the likely direction for 2023? Is it better to wait a little for a slump in the new year or are we looking at a strong physical market price and will we get to £3,000 an ounce as a few have been saying to me. Trying to invoke the FOMO. 

I would like to get a batch of 100 sovereign or 25 Britannia's. I have noticed as well a reduced amount of the coins available at most of the usual places. I will give an update on which way I eventually go. 

Kind regards 

You might want to try reading this advice page:

https://www.chards.co.uk/blog/advice-guide-for-uk-bullion-investors/1041

Which will steer to towards gold rather than silver.

There are plenty of one ounce gold Brits around, and premiums are lower than for sovereigns.

😎

[ZRPMs]

Thanks to all that have answered.

Lots of great advise. Especially in getting rid of debt. I had only earmarked about 5% to 10% of any funds for my PM's purchases. This way I only use what I can afford to leave sitting for an unspecified length of time. I have about 12 months living expenses as liquid funds with a small emergency fund as well. I do use my ISA. My house is paid for, so mortgage free. I have other property at about 50%LTV as a conservative estimate. I have been making regular over payments. I intend on paying a couple off. I've not really put much into my SIPP. Only reason is I have had quite a few health scares. Latest was a heart attack. I'm ok and still a few years from 50 but never really wanted to tie up my money in something I could not get it out of if worst case happened. I realise the tax advantages of the pension. It just concerned me that with all that happened I might not actually get to benefit from the savings. I like the idea of gold more than silver only due to the VAT status. It always makes me feel I end up paying too much for the silver. I think the idea of just getting it when you have the spare cash. In effect £ cost averaging. Makes as much if not more sense than trying to play the market waiting for the dips. Only concern I have is it is a larger purchase than I would normally make. I have a small collection of other collectables, again, nothing I need to rely on for income. Nice to have and at worst I should get a bit more than I've put in with a little effort on the sales side. They remain quite sort after. Still its not all about the money and like my coins I do get some enjoyment from them.

I'll keep you posted on what I get and look forward to perhaps posting a picture or two. Once again, Many thanks for all your responses.

Kind regards ZRPMs

[Bigmarc]

Difficult buying first lot of gold so close to it's all time high. It's easy for us to say as we are already invested at a lower rate. I don't do shares myself but at the moment they seem an absolute bargain. If I was someone else who had money kicking around I would definitely look into buying Google or apple and try to time it as the fed pivots, and we all know this is when inflation is at the 2% mark. 

[Mcgrimes]

On 11/12/2022 at 11:23, honestinjun said:

As I mentioned in an earlier post there is a massive disconnect between the 'spot' price and physical gold - coins in particular - they may as well be two different entities.

Waiting for the spot to drop in order to pick up some bargain bullion is a fools game. Any physical (coins in particular) that comes near spot is getting grabbed. Why? Because peopled are cottoning on to the worthless fiat currency (not money) that we are awash with. Physical gold/property is the only real store of value. Make of that what you will.

As much as I like gold and silver, which is plenty, it’s even less useful than jewellery, which by design is intended to be displayed.

Therefore, it’s perception of physical store of value is dependent on like minded people sharing this common mindset, which is less than those that see the same use in the USD, a significantly more liquid type of store of value.

I suppose my point is that it isn’t one of two stores of value, but in actual fact, a fairly inefficient one

Edited December 12, 2022 by Mcgrimes

[honestinjun]

11 minutes ago, Mcgrimes said:

As much as I like gold and silver, which is plenty, it’s even less useful than jewellery, which by design is intended to be displayed.

Therefore, it’s perception of physical store of value is dependent on like minded people sharing this common mindset, which is less than those that see the same use in the USD, a significantly more liquid type of store of value.

I suppose my point is that it isn’t one of two stores of value, but in actual fact, a fairly inefficient one

How can the USD, or any other fiat, be a store of value when it is backed by absolutely nothing and can be printed ad infinitum?

[Mcgrimes]

1 hour ago, honestinjun said:

How can the USD, or any other fiat, be a store of value when it is backed by absolutely nothing and can be printed ad infinitum?

How can a metal with very limited industrial use that can be mined from the ground be used as a store of value?

Money is a store of value, because you can use it to procure products at a later stage. I’d argue currency was created with store of value being one of its prime purposes.

Money can be printed (inflated), but so can gold by way of increasing supply. Granted, money is easier to inflate on a larger and more readily available scale.

But scarcity doesn’t necessitate value.

[honestinjun]

15 minutes ago, Mcgrimes said:

How can a metal with very limited industrial use that can be mined from the ground be used as a store of value?

Money is a store of value, because you can use it to procure products at a later stage. I’d argue currency was created with store of value being one of its prime purposes.

Money can be printed (inflated), but so can gold by way of increasing supply. Granted, money is easier to inflate on a larger and more readily available scale.

But scarcity doesn’t necessitate value.

Man I'm glad I don't have you as a financial adviser. Gold is a store of value because it is not subject to the inflationary pressures that fiat currencies are. Since 1913, the US dollar has lost 96% of its value. Over the last 20 years, inflation in the US has eaten away 57% of the dollar's purchasing power. Compare that to gold.

[Mcgrimes]

54 minutes ago, honestinjun said:

Man I'm glad I don't have you as a financial adviser. Gold is a store of value because it is not subject to the inflationary pressures that fiat currencies are. Since 1913, the US dollar has lost 96% of its value. Over the last 20 years, inflation in the US has eaten away 57% of the dollar's purchasing power. Compare that to gold.

Gold lost 5% of its value in the past 6 months; just because something can lose value, doesn’t mean it isn’t a store of value.

You also ignore the growth potential of fiat investments; 10k invested in the ftse 100 (with reinvestment of dividends) in 1987 would have 10x its value in 30 years according to HL. Though it’s easy to cherry pick dates to prove a point, I don’t know what the equivalent would be for a sum of money to be invested in 1913, I’ll let you look.

Gold is also comparatively illiquid and suffers from fairly high spreads compared to other stores of value.

To be clear, my previous question was sarcastic, I do see metals as stores of value.

Edited December 12, 2022 by Mcgrimes

[Mcgrimes]

Just now, Mcgrimes said:

Gold lost 5% of its value in the past 6 months; just because something can lose value, doesn’t mean it isn’t a store of value.

You also ignore the growth potential of fiat investments; 10k invested in the ftse 100 (with reinvestment of dividends) in 1987 would have 10x its value in 30 years according to HL. Though it’s easy to cherry pick dates to prove a point, I don’t know what the equivalent would be for a sum of money to be invested in 1913, I’ll let you look.

Gold is also comparatively illiquid and suffers from fairly high spreads compared to other stores of value.

To be clear, my previous question was sarcastic, I do see metals as stores of value.

 

 

[Stuntman]

Quote

 

At the moment, I think there is probably some medium to long term value in buying selected FTSE 100 stocks with good dividend yields and a sound underlying business model.  I am doing this with my monthly SIPP contributions at the moment, started in November and bought some more this month and will probably buy some more in January.

Currently I have bought seven stocks across a range of sectors with an average dividend yield of about 5%.  I expect these to continue to pay at least this amount of dividend cash in absolute value terms for the next few years and they should probably go up in value over the medium term.

Like @Bigmarc, I think there is currently a buying opportunity for some blue-chip businesses as they have perhaps been smashed down beyond what would be considered fair value.  I can afford to tie up this capital for a few years and benefit from the income rolling up in the SIPP until I choose to access it when the rules allow me to.

[honestinjun]

1 hour ago, honestinjun said:

How can a metal with very limited industrial use that can be mined from the ground be used as a store of value?

Money is a store of value, because you can use it to procure products at a later stage. I’d argue currency was created with store of value being one of its prime purposes.

My time is too valuable to waste with someone who thinks currency is money.

Goodnight.

Edited December 12, 2022 by honestinjun

[PhilOdgny]

My pension contributions are my investment in the stock markets ... tax free.  The rest is up to me to invest in other things.

[Silverlocks]

On 11/12/2022 at 13:54, Pete said:

3. If you are a tax payer then consider paying money into a SIPP and get full tax credit into your SIPP.
This assumes you are not wanting to use SIPP money until aged 55+
Ignoring the tax relief offered is a big mistake.
Use your SIPP money to buy UK Equity Growth Funds that are always hot on the list of financial advisors with billions in value.

If this money has already had income tax paid on it (which it presumably has as OP has bought and sold a house with it) then a SIPP is of little real benefit, with the possible benefit of insulating OP from capital gains tax - which can be achieved by buying CGT-exempt gold coins.  A SIPP will only count against tax if you invest salary or other income pre-tax through salary sacrifice.

OP might be able to use it as a sort of big ISA to insulate investments made through it from CGT but I'm not sure a SIPP is necessarily the right vehicle for OP's money as it comes with some baggage and is still limited to £40,000 investment per annum.  An ISA might be a possibility but OP would be limited to £20,000 per year.

It might be the case that if OP wants to invest in physical PM's then the best way to do this is to buy a load of Britannias or bulk best-value sovs and maybe put some of the money into gold ETFs, or some sort of CGT shielded investment (allocated or otherwise) if they want to do other metals.  As to whether putting all their money into gold is the right thing to do, that's a more complex question.  I am not a financial advisor, nor do I play one on TV, so I'm not going to venture an opinion.  Having said this, there is going to be a savage reduction in the tax-free allowance for CGT, so if OP does want to invest in PMs then the case for Brits or Sovs is quite a bit stronger than it might have otherwise been.

Just a note to OP, if you're buying Brits or sovs in bulk, there are some discounts from vendors and vendors offering wholesale lots of (for example) 50 sovs at decent prices.  It would pay to shop around and also note that the market here on TSF is quite capable of absorbing 50-100 sovs in a week if they do want to flog them later on.

 

 

[Pete]

17 hours ago, Silverlocks said:

If this money has already had income tax paid on it (which it presumably has as OP has bought and sold a house with it) then a SIPP is of little real benefit, with the possible benefit of insulating OP from capital gains tax - which can be achieved by buying CGT-exempt gold coins.  A SIPP will only count against tax if you invest salary or other income pre-tax through salary sacrifice.

OP might be able to use it as a sort of big ISA to insulate investments made through it from CGT but I'm not sure a SIPP is necessarily the right vehicle for OP's money as it comes with some baggage and is still limited to £40,000 investment per annum.  An ISA might be a possibility but OP would be limited to £20,000 per year.

It might be the case that if OP wants to invest in physical PM's then the best way to do this is to buy a load of Britannias or bulk best-value sovs and maybe put some of the money into gold ETFs, or some sort of CGT shielded investment (allocated or otherwise) if they want to do other metals.  As to whether putting all their money into gold is the right thing to do, that's a more complex question.  I am not a financial advisor, nor do I play one on TV, so I'm not going to venture an opinion.  Having said this, there is going to be a savage reduction in the tax-free allowance for CGT, so if OP does want to invest in PMs then the case for Brits or Sovs is quite a bit stronger than it might have otherwise been.

Just a note to OP, if you're buying Brits or sovs in bulk, there are some discounts from vendors and vendors offering wholesale lots of (for example) 50 sovs at decent prices.  It would pay to shop around and also note that the market here on TSF is quite capable of absorbing 50-100 sovs in a week if they do want to flog them later on.

 

 

Yes you are correct in one respect but I am assuming this person also has some sort of taxed regular income and could therefore recover most if not all of his PAYE tax. The SIPP doesn't care where the money comes from but tax can be recovered from investing in a SIPP. Even people with zero income and no tax deducted can pay £2,880 into a SIPP each tax year and receive £720 for free. There is as you point out an annual cap at £40k but doing this before the end of March followed by another tranche a week later falls into 2 tax years making £80k available.

[Stuntman]

^^^ I agree with what @Pete says above.  And you can also carry forward unused allowances from the previous three tax years, so as long as you have enough taxable earnings in the current year, you can put more than £40,000 away in a SIPP this year, obtain the tax relief, but have to wait until age 55 or 57 until you can take the benefits.

This may be a very good idea, depending on your age and which tax bracket you are in.  My SIPP is the first home for any investment money I have at the moment, and I use it to hold cash, individual shares, stock market funds, and ETFs.

[ZRPMs]

Hi Everyone,

I've been looking around for my purchase. To be honest, Chards seem to be offering about the best. I've bought with them in the past and they had good service then. Only other dealer I've used that posted was Atkinsons, who were also helpful but I think Chards just piped them. I would like a bulk 100 of sovereigns but they just don't seem to be out there. My local dealers don't seem to be able to fill existing orders for sovereigns. So I think its going to have to be 25 Britannia's. also being tempted by a couple of kilo bars of silver. 

I think the rest of my pennies are going to invested in ISA, A little in the SIPP ( not too much only due to personal fears I might not make the next 10 years. Silly I know but can't help the thought ) Some cash savings just in case of a couple of opportunities present themselves. and I'll pay a couple of the BTL mortgages off. My rates at the moment are only 3% to 4% so still quite low but I suppose BOE are heading for the more usual 5% to 6% which is getting closer to the inflation rate after the mortgage company adds their cut.

I hope to post the pictures of the purchase when I have them.  Many thanks to everybody for their input. I am glad I joined The Silver Forum. 

Kind regards ZRPMs

[James32]

35 minutes ago, ZRPMs said:

Hi Everyone,

I've been looking around for my purchase. To be honest, Chards seem to be offering about the best. I've bought with them in the past and they had good service then. Only other dealer I've used that posted was Atkinsons, who were also helpful but I think Chards just piped them. I would like a bulk 100 of sovereigns but they just don't seem to be out there. My local dealers don't seem to be able to fill existing orders for sovereigns. So I think its going to have to be 25 Britannia's. also being tempted by a couple of kilo bars of silver. 

I think the rest of my pennies are going to invested in ISA, A little in the SIPP ( not too much only due to personal fears I might not make the next 10 years. Silly I know but can't help the thought ) Some cash savings just in case of a couple of opportunities present themselves. and I'll pay a couple of the BTL mortgages off. My rates at the moment are only 3% to 4% so still quite low but I suppose BOE are heading for the more usual 5% to 6% which is getting closer to the inflation rate after the mortgage company adds their cut.

I hope to post the pictures of the purchase when I have them.  Many thanks to everybody for their input. I am glad I joined The Silver Forum. 

Kind regards ZRPMs

Might be worthwhile getting a membership on here, pretty sure you won't find cheaper prices at a dealer. 

Put up some wanted ad's, and also spread out your buying over a period of months. 

[SiCole]

If you are purely looking to purchase for the price of gold to increase and not for any interest in them, book an appointment with an independent financial adviser. It is well worth the money!

[ZRPMs]

Thanks James32,

I've just posted a wanted. Hopefully done it right.

Kind regards ZRPMs

[Silverlocks]

12 hours ago, ZRPMs said:

Hi Everyone,

I've been looking around for my purchase. To be honest, Chards seem to be offering about the best. I've bought with them in the past and they had good service then. Only other dealer I've used that posted was Atkinsons, who were also helpful but I think Chards just piped them. I would like a bulk 100 of sovereigns but they just don't seem to be out there. My local dealers don't seem to be able to fill existing orders for sovereigns. So I think its going to have to be 25 Britannia's. also being tempted by a couple of kilo bars of silver. 

I think the rest of my pennies are going to invested in ISA, A little in the SIPP ( not too much only due to personal fears I might not make the next 10 years. Silly I know but can't help the thought ) Some cash savings just in case of a couple of opportunities present themselves. and I'll pay a couple of the BTL mortgages off. My rates at the moment are only 3% to 4% so still quite low but I suppose BOE are heading for the more usual 5% to 6% which is getting closer to the inflation rate after the mortgage company adds their cut.

I hope to post the pictures of the purchase when I have them.  Many thanks to everybody for their input. I am glad I joined The Silver Forum. 

Kind regards ZRPMs

If you're buying at scale you could try this from suissegold.eu.  Not a fantastic price (HGM would be cheaper for 50 if they had them in stock), but not bad - and they are claiming to have it available.  Tack on some for freight, starting about £30.  At that scale, maybe take a look at some of their other investment gold options.

Wholesale 50 x British Gold Sovereigns (suissegold.eu)

Tube of 10 x 2023 British Britannia 1 Ounce Gold Coin (suissegold.eu)

 

Edited December 14, 2022 by Silverlocks

[daca]

@ZRPMs the options posted just above are for storage only. Also check the dealers on trustpilot and scamadviser

https://uk.trustpilot.com/review/suissegold.eu

Edited December 14, 2022 by daca

[walker]

Hello im trying to find out how to buy gold  without paying the crazy expensive premiums ?? Any help would be greatly appreciated. I don’t mind a premium just hate paying $80-$100 + over spot