GOLDEN TIPS
ON BUYING GOLD
From investment point of view, one
should invest in bars, coins and not jewellery. You may not get a good price
for jewellery because of making and processing charges involved in it. If you
sell gold after keeping it for less than three years of buying it, you have to
pay 30% capital gain tax. Tax will be 20% if you sell after three years.
Here are some tips that you must
consider before buying gold:
1- Level of
Purity - Ensure that the gold you are buying is pure. Karat is the unit
used to measure the purity of gold, higher the karat, more pure the gold is.
Therefore, 24, 22, 18 karat gold has the purest form in that order. In case of
24k gold, all 24 parts in the gold are pure gold with extremely low level of
impurities. If you are purchasing for investment purpose, 24K suits else opt
for 22K if you intend to use it for your own consumption. The price of 24K is
higher than lower karat gold.
For instance ,22k gold is 91.6% gold as it contains 22 parts gold and 2 parts of other metal. Likewise, 18k gold is made up of 18 parts of gold and 6 parts of other metals, making it 75% gold .Research the type of gold you want and the different rates based on purity levels.
For instance ,22k gold is 91.6% gold as it contains 22 parts gold and 2 parts of other metal. Likewise, 18k gold is made up of 18 parts of gold and 6 parts of other metals, making it 75% gold .Research the type of gold you want and the different rates based on purity levels.
2-When to buy Gold- When looking to buy gold bullion,keep an eye out for any
major news and announcements coming
from institutions including Banks, the Stock Exchange, Wall Street, Governments etc. Negative
economic and political messages regarding Credit, Currency, Stocks, Debt, Property, Unemployment
and Quantitative Easing create unrest, with particular reference to the more influential economies
such as those of the US, China and Europe.
As a general rule of thumb it is said when other investments such as property and stocks are underperforming, the price of gold and silver rise as it is believed many major investors and companies use gold as an insurance policy to cover these losses accumulated elsewhere. This often provides an ideal time to add more gold bullion to your portfolio or enter the market for the first time.
from institutions including Banks, the Stock Exchange, Wall Street, Governments etc. Negative
economic and political messages regarding Credit, Currency, Stocks, Debt, Property, Unemployment
and Quantitative Easing create unrest, with particular reference to the more influential economies
such as those of the US, China and Europe.
As a general rule of thumb it is said when other investments such as property and stocks are underperforming, the price of gold and silver rise as it is believed many major investors and companies use gold as an insurance policy to cover these losses accumulated elsewhere. This often provides an ideal time to add more gold bullion to your portfolio or enter the market for the first time.
3- Cost per gram
- Before buying any amount of gold, ensure you check the per gram cost. This
will give you a fair idea of the current price of gold in the market. Remember
that gold prices can vary at different showrooms . This is because they come from
different associations of gold jewellers . However , the biggest jewellers
usually have similar rates .
4- Genuine Certification – Gold that does
not carry certification by BIS (Bureau of Indian Standard) may not be the real deal.
India has over 13000 BIS hallmark jewellery showrooms , which are responsible for
ensuring gold is of genuine quality and needs certain standards . However, according
to the QUINT, less than one in every 3 pieces of jewellery sold in India
currently is guaranteed for quality and purity that is hallmarked. Thus, whether
it is good jewellery to wear or a gold coin for investing purposes , make your
purchase only after you see evidence of the BIS hallmark.
5-Fineness: Fineness shows the purity of
precious metals by parts per thousand rather than karats. Fineness is another
way of expressing the precious metal content of gold jewellery, and represents
the purity in parts per thousand. When gold is refined to a fineness level of
999.9 parts per thousand it is stated as 999.9.
So whenever you go to purchase gold it is suggested to ask for its fineness.
So whenever you go to purchase gold it is suggested to ask for its fineness.
6-Return policy: Always check for the
website or seller's return or buyback policy while buying gold online. These
days most big gold chains have their online stores and they offer both returns
and exchange. However, the exchange policy of gold has stricter terms and conditions
as compared to other items sold online. So, it is important to go through the
terms and conditions carefully before making your purchase decision.
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