Precious Metals - Are They Worth Investing In?

In the economic climate of today, with the middle class slowly fizzling out, more and more people are searching for any means possible to ensure a financially secure future for themselves and their family. For some, this means taking on a second job or going back to school to earn a degree in a field that will provide them with a more high paying career. For others, this means coming up with alternative methods to make sure that their family will have a safety net of cash to fall on should they fall into a difficult financial emergency, like so many others have in the past several years.

One of these alternative methods is investing in precious metals. In this article we will discuss whether or not investing in precious metals is worth the initial cost, as well as tips in precious metals investment, and the best precious metals to invest in to ensure the most successful possible monetary outcome for you and your family.

• Is investing in precious metals worth it?

In short, yes. While there are some arguments against investing in precious metals, none come close to refuting all of the reasons for making the investment. As economists watch world economies begin to lose their stamina and lose value across the globe, interest in investing in precious metals has become more and more popular. One day, paper money may very well be worth no more than the paper it's printed on - but gold will always be gold. Buying precious metals now is a safe haven against a potential collapse in the economy, in a worst case scenario. And while a total collapse may be unlikely, precious metals still provide padding to your portfolio in the event of the value of the dollar decreasing at all, something which has proven to be unavoidable in the past.

• Tips in precious metals investment.

The best advice is not to over invest. In a manner of speaking, like with any aspect of your life, you don't want to put all of your eggs into one basket. While precious metals are a sound investment, they should not be your only investment. Top financial advisers and gurus suggest investing 3-8% of your total portfolio in precious metals.

In addition to not investing too much, it's imperative to understand exactly why people choose to invest in precious metals. It offers no annual payback, no cash in the bank. Investing in precious metals is an investment in the future, a preparation for problems in the economy. Expecting immediate returns from precious metals will only lead to disappointment. Of course, this should not deter you. While there is no immediate financial gain from purchasing precious metals, the safety net created for you and your family is nearly invaluable.

Lastly, make sure to research different ways of investing in precious metals and decide which works best for you. The top three ways suggested by financial advisers and gurus are: stocks and mutual funds holding shares in mining companies, exchange traded funds that hold bullion (precious metal bars valued by weight), or coins - both antique and newly minted - that are made from gold, silver, platinum, or palladium.

• Best precious metals to invest in.

Of course, when most people think of investing in precious metals - or when they think about precious metals at all - the one that comes to mind is gold. And with good reason, as gold has long been a symbol of wealth, dating all the way back to ancient times, and is unlikely to ever lose value. But it isn't the only precious metal that's worth investing in. The other three precious metals that analysts suggest investing in are silver, platinum, and palladium.

In particular, platinum and palladium are growing in popularity wildly with investors in recent years. Platinum, because it is ten times more rare than gold, and palladium, because it is one of the more obscure precious metals.

Ultimately, the decision lies with you. Do as much research as you can, and remember that an investment in precious metals is an investment not in today, but in tomorrow.  

How Liquid Are Your Assets?

When it comes to financial asset management understanding the ability to turn assets into cash is important. When an emergency comes up or an opportunity to make a substantial investment presents itself it is imperative to have access to the money needed without long wait times.

What Is Liquidity

Liquidity refers to the ability to take assets and turn them around into spendable or investable cash. Cash is, itself, the most liquid asset since it is easily spendable as it is. Other types of investments vary in liquidity - which means how easy are they to convert to cash. To have a firm idea of the financial state of someone attempting to make a major purchase or investment, they would be asked "how liquid are you?" Since some assets are not easily convertible they are still valid investments but don't aid in liquidity in the event a person needs a quick influx of spendable cash.

Ranking Liquidity of Assets

If concerned about having substantial liquid assets, one should consider having a diverse portfolio of investments and assets. Here is a ranking of liquidity that can serve as a guide.

• Savings Bonds - After cash, these are the most liquid because they can easily be sold to a bank and offer immediate cash in hand.
• Stocks, bonds, options & commodities - These can be sold fairly easily and quickly, but may take a loss in doing so.
• Certificates of deposit - These are not too difficult to convert but there is a penalty.
• Collectibles - This includes art, coins and more. If taken to a dealer they may be convertible to cash fairly quickly but not likely at the fairest rate. For some collectibles it may be more difficult and time-consuming to find a dealer or pawn shop willing to take them. The best bet for the investment made is to send them to auction or other sale, but that can take a good deal of time to arrange.
• Preferred or restricted shares - These have restrictions on when and how they can be sold so are less liquid and may not be accessible at all under the circumstances in which the cash is needed.
• Retirement funds - These may allow the owner to take a loan or to close them under certain conditions but it can take several days to a few weeks and comes with hefty penalties or interest on the loan.
• Real estate - Obviously one of the least liquid assets though also one of the most significant assets to own, real estate can take a significant amount of time to sell and even longer if you want to obtain the most money possible for the investment made.

Obtaining Substantial Liquid Assets

Having a diverse portfolio with a mix of several different types of assets makes it easier to liquidate assets when needed without destroying the portfolio. For proper financial asset management it is a good rule of thumb to maintain some assets in several different categories. Some assets should be easily available to convert to cash. Others that are less easy to convert often also have a higher return on the investment when they are sold or converted thoughtfully and taking the market into account. Retaining some assets that are difficult to liquidate may be a great way to ensure continued investment income. Balancing all of these needs is indispensable to financial health, but it is also valuable to ensure substantial liquid assets that can serve unexpected needs.
Every investor should ask themselves "how liquid are you?" and have a reasonable answer at any given time of how much cash they could convert their investments into including how long it would take to do so. Financial asset management includes the skill of being able to access those assets as needed.

Security for the Next Economic Collapse

As far as faith in the American Dollar is concerned, there has been a global paradigm shift. During the financial crisis of 2007 and 2008, the U.S. Congress held closed door sessions to discuss the economic crisis. Officials from President George W. Bush's administration and Federal Reserve Chairman Ben Bernanke warned Congressmen that if huge taxpayer bailouts were not passed, the country would suffer economic Armageddon. Administration officials threatened riots, bank runs and martial law. Since the crisis, massive inflation and a worldwide loss of confidence in the dollar ensued. Financial experts like Jim Rogers and Peter Schiff, and Presidential candidate Congressman Ron Paul, continued to predict the dollar collapse and the Next Great Depression. The only question now is how to protect yourself from economic collapse?

Just read the international news and you will find motivation to believe in and survive the collapse. Oil rich nations like Russia and Iraq no longer trade oil exclusively in petro-dollars. China and other leading economic nations openly reject the dollar and make plans to institute a totally different world reserve currency. The price of gold has sky-rocketed, a sign that the dollar is weak. The U.S. Stock Market is so inflated that its bubble is bound to pop soon. To survive the collapse, you have to first believe its coming. The signs are ominous.

The average citizen with little in savings or stockpile of supplies is vulnerable to the inevitable credit crunch and devaluation of the dollar. Bank runs and disruption in the food and retail supply chain will leave people with little means to survive over the long haul. A rapid economic collapse, whether triggered by a terrorist attack on our electric grid, a natural disaster larger than Katrina, a stock market crash, or hyperinflation, will leave most Americans scratching their heads and running for cover.

The global paradigm shift in our awareness of economics can actually push nations toward more fiscal responsibility and sustainable growth. However, I would not suggest waiting for your elected officials to fix the economy before you take precautions. How to protect yourself from economic collapse should be your top priority.

Stay Put!

First of all, don't leave the country thinking you will be better off. The corruption that exists in the United States government and economy exists worldwide! Would you rather tough it out in the United States, or in Africa? Fleeing the country to find safe haven in a foreign land is a foolish and dangerous option.

The Sky is Falling!

Planning for the worst, and hoping for the best, is not only very prudent, but also very liberating. Lets face it, not enough people look hard at their finances because they are scary. Putting all of your financial papers in front of you and determining ways to increase income and reduce spending are crucial survival skills. In an economic collapse, you will need to know what assets you have, and what skill sets you possess that can help feed you and your family for the next month. Develop those skills now, and even if the economy holds itself together, the worse that can happen is you will earn more money!

One Chicken For That Bag of Rice Please

Learn how to barter. Make sure you have stored plenty of goods you can trade, such as ammunition, water, food, clothing, and medicine. Money may be completely worthless in an economic collapse. In a traditional economy, only your skills and tangible goods carry much value. Start inventorying your storehouse now so that you can barter later for the survival items that you and your family will need.

Look Up To The Heavens
Soldiers are fond of the saying "Their ain't no atheists in a fox hole." I don't believe atheists would fair well during economic Armageddon either. Keep a strong faith in God and He will pull you through the worst of times. God wants you to prepare, but he also wants you to remain focused on Him and his Love and Mercy. Whatever faith tradition you follow, it sure doesn't hurt to pray when the SHTF.