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Investing in gold is among the best options for long term needs, happiness and security.
- Investment in gold works both in hedge market fluctuation and inflation. Gold prices are less volatile than equities and gold gives a good return even in falling markets.
- Gold can be bought in physical form or in the form of ETFs (Exchange Traded Funds). It is easier to buy, hold and sell gold in ETF form. In case you don’t have a demat account, then gold funds are also available like other mutual fund units through SIP.
- Investment in gold is tax efficient too. As there is no income during the holding period of gold, the tax liability is nil. If you need to sell, then, the long term capital gain tax rates are also lower than normal rates. Moreover the cost of purchase gets increased by inflation index. Thus, zero tax liability in holding while your money is appreciating more than the rate of interest or inflation in general and lower tax liability in case of sale also – that’s the advantage of buying Gold.
- To buy a house, you can mortgage the gold and take a loan. Interest paid on this loan can again be claimed as a deduction from your house property income. This is specifically useful for houses which cannot be easily mortgaged. Therefore, we recommend you to reduce your tax liability by purchasing gold as compared to NSC/FD in your child’s name.
- You can also take a loan against gold as a security for temporary needs at a reasonable rate of interest within minutes. Buy gold for long term needs, happiness and security.
Buying gold coins from banks or MMTC at a premium from market price does not help. You may not be able to sell it at a premium too – your sale might be below the market price. Hence, investing in gold (be it buying in ETF form or even as jewelry) keeps your loved ones happy.