I was once given this advice about how to invest in gold coins.

May 18, 2011 – I was once given this advice about how to invest in gold coins: “Buy them regularly, regardless of price. Stash them away safely. And forget about them.” My gut reaction was that it is insane to buy anything without considering price, but it made sense after ruminating on it for a while.

Regularly purchasing gold coins will average out any price volatility, and the investment will track gold’s long term trends. I am not a gambler, so I invest for the long term – speculation on short term movements is just too risky and more than a little harrowing.

When the economy is on the upside I expect gold to fall accordingly – but its value remains intact. All that means to me is that my periodic investment buys more gold coins. When the cycle reverses again, gold will rise accordingly but my investment will also continue to grow.

The trick is to consider gold coin investments differently than all of the others. Before inflation began to strip away the dollar’s worth it was common practice to hoard cash. It made sense because the banking system was fraught with danger, costing many their life savings. Cash stuffed in the mattress, however, would always be there – assuming no catastrophe occurred – and it would buy essentially the same things it did when it was stashed away.

Gold coins in a safe-deposit box is today’s version of the greenback stuffed mattress. It’s not put there to earn dollars but to ensure that the wealth it represents will always be at your disposal. No matter what happens to the dollar or the economy in general, gold’s purchasing power remains constant.

Many experts predict the dollar will soon become worthless, possibly in just the next few years. Wealth denominated in dollars will be meaningless, but those “do-nothing” gold coin investments will have the same true value as the day they were bought, put away, and forgotten.

Kevin Johnson

Senior Staff Writer –

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