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What are disadvantages of investing money in gold?

· 4 months ago · 3 replies · 251

Indeed, gold is a great investment. However, the fact remains that there are some disadvantages of investing money in gold. Gold does not generate income like real estate investments or stock investments. Moreover, you nay also suffer from losses in case if the value of gold drops. Gold investments are also taxed heavily as well. So, what are some other disadvantages of gold investments?

3 replies

· 4 months ago

Here again my idea of buying gold was to wear it and not think in terms of profiteering by it The gold that one buys to wear is never sold. And those who buy as investment need to keep a vigil to kow when is the best time to sell it.

· 4 months ago

Taxed heavily? Guess that depends on where you live. Some states have no tax on it.

The disadvantage of no income generating is one but you don't invest in gold for that reason, if you do you're doing it for the wrong reasons.

The other disadvantages are if you buy paper gold, like an etf or gld, you don't actually own the physical gold and have counterparty risk. If you own physical, you have to find a secure place for it which can be hard to do if you don't own your own place and even then if you're a target it would be hard to prevent theft.

OP · 4 months ago

On Jun 9, 2026, MoneyMan said:
Taxed heavily? Guess that depends on where you live. Some states have no tax on it.
The disadvantage of no income generating is one but you don't invest in gold for that reason, if you do you're doing it for the wrong reasons.
The other disadvantages are if you buy paper gold, like an etf or gld, you don't actually own the physical gold and have counterparty risk. If you own physical, you have to find a secure place for it which can be hard to do if you don't own your own place and even then if you're a target it would be hard to prevent theft.

Majority of the people never generate income in daiky basis when they buy gold. However, gold traders certainly do generate profits when they buy and sell gold in daily basis. There are many scalpers who tend to generate profits when they trade in gold online. I am not sure if they actually buy real gold. However, they are indeed generating profits on gold.

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