Dan Celia

Financial Issues

November 2018 – Q: I need income. Since many believe the market is going to crash, I am currently looking at putting all of my money into gold. Would that be wise?

A: Some of the worst years in the market have been in the last 10 years. During that time, gold hit an all-time high. As of September, gold had been up about 50.2% in the last 10 years (an average of 4.1% a year). In contrast, the S&P 500 was up 133% and the Dow Industrials up 131%. 

Gold does not produce dividends each year, and it can cost as much as 40% to sell it. If you truly want to protect your money, use CDs, inflation-protected government bonds, or even treasury bonds. 

Better yet, develop a good income portfolio using these things along with a charitable gift annuity and great income-producing stocks.

Gold and silver speculative commodities are very risky. If you need income and want protection, in my opinion, gold or silver is not the answer.

____________________

Dan Celia has been in financial management for more than 30 years. He works closely with AFA Foundation and can be heard six days a week on AFR Talk (afr.net).

Financial Issues website
Email: [email protected]
AFA Foundation: 800-326-4543, ext 345