Precious Metals (Gold, Silver) have been a 🔥 topic lately with the wild US monetary policy —
Here’s a breakdown of all the ways you can invest in precious metals, as well as whether I think it’s good investment (for me).
\*thread*\ ☕️
There are generally 3️⃣ main ways to invest in precious metals:
• Physical metal (coins, stored gold, etc)
• ETFs that track the spot price of the metal (and shares are often backed by physical metal)
• Mining companies 💰 ⛏ — they dig the stuff up and sell it.
First, the physical metal —
Some people love collecting gold and silver coins or bars.
The upside is you physically own it!
Two issues I don’t like: You need to safety store it (get a good safe or pay someone) and they’re hard to move (not very liquid if you want to sell).
This can be a good alternative to physical as you don’t have to protect it (because you just own shares) and you can sell it quick (more liquid).
A good example is iShares Silver Trust - it tracks the current silver spot price per ounce.
Lastly, perhaps my personal favorite, the mining company.
I personal own shares of Barrick gold.
The risk with a mining company is that you’re also investing in a company, so if their metrics (besides the metal price) are poor, you won’t see returns.
also pays a dividend (although it’s a tiny one!) to reward you for investing with them.
The pros of owning a mining company is you aren’t owning gold someone can steal (like coins), it’s liquid, and if you know the bushes well you can profit on their gain.
However you choose to invest, you need to decide are precious metals right for YOU.
For me, they’re a small part of my portfolio (10% or less) and act as a good counter to inflation.
Gold and silver also tend to go up in times of economic uncertainty.
Am I buying more?
Currently NO. I bought into precious metals around March of this year, and have not bought more in the last few months.
While I consider it a good investment, I personally feel pricing is quite high due to uncertainty.
Should we see market stability, prices likely lower.
I bought shares of Barrick at around $17 a share, and they now sit around $29 a share. I’ve been paid dividends to hold the shares, and will likely continue to hold .
Should prices return to previous levels, I’ll likely buy more.
Hope you learned a few things! 📖 📚
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Saving money is something you can get better at it the more you do it.
Eventually, you can save money without having to think much about it at all.
Here’s 5 tricks I’ve used to consistently save 50%+ of my income a month:
Number 1
Write it all down. In the beginning you need to understand what you spend and why. How often. On what. That means you need money data.
When I started this I’d carry a pen and small notebook with me and I’d write the date, what I bought, and how much I spent
Number 2
Start talking to your friends and family about saving money. Talk to strangers. Talk to anyone who will talk to you about saving and spending. How much is their cell phone bill? Where’s the cheapest place for groceries? What’s their favorite way to save?
We suck at money because we’re afraid to talk about money. Talk about it with people and you’ll learn what they know.
Here are 5 quick ways to hack your mindset so you’ll spend less and save more
#1: Put a ‘time roadblock’ in front of your spending
I always wait a few days before buying anything new (that’s a want vs need)
Often after a few days, I don’t even want it anymore
Mr. Money Mustache calls this putting stuff in the spending machine to slow it down
#2: Separate wants vs needs (and be honest!)
It’s okay to want something. But it’s not okay to pretend you NEED something you WANT. Basic necessities like food, shelter, clothing, etc. are needs. Most other things are wants.
The Dogs of the Dow is a high yield dividend technique that most investors don’t know about
Its outperformed the stock market in some years, and can be a great way to find high yield dividend stocks
I’ll walk you thru the steps here \\thread\\
At the beginning of the year, the investor picks out the 10 highest yielding stocks on the Dow Jones Industrial Average and invests an equal amount into each
Highest yield refers to the stocks yearly dividend payout percentage compared to its share price
It’s called the Dogs of the Dow because stocks with a high yield are thought of as down on their luck (aka in the doghouse)
But there are be times when stocks go up in dividend yield and are undervalued
Here are the Dogs of the Dow and their dividend yields
50% of my investing portfolio is in index funds/ETFs
This gives me a diversified base to invest from, so worst case I will still have those if my other investments fail
Here are my Top 5 ETFs:
$VTI
THIS is the fund. If I held just one, it’d be this one. It’s vanguards Total US stock market fund.
Owning shares of these mean I own small pieces of every publicly traded company in the United States.
This is a great long term hold with growth and a small dividend.
$VXUS
This is vanguards international fund (basically exposure to the world minus the United States). I hold less of this than VTI (I try to keep it to 20% of my $VTI exposure or less). I hope the US continues to outperform but if not this gives me exposure to the globe.