This article does not contain any investment advice. It’s an article by a contributor outside of InvestingHaven’s core research team, and the beliefs are the ones from the writer.
The uncertainty caused by the coronavirus has sent the markets plunging. Some people feel that this is the best time to invest, and others worry that investing in the market is not safe. Investors understand that a crash can be a good time to purchase stocks at a discount. It can be compared to when property prices plummet. A tanking stock market can be a great opportunity for new buyers who have limited capital to get into the market and then benefit from its recovery.
On the other side of the coin, the COVID–19 was declared a pandemic in March 2020. This has led some to believe that a recession is on the horizon. This makes the prevailing wisdom about when a person should invest unreliable.
When Is the Best Time to Buy?
Conventional wisdom says that the best time to buy a stock is when it hits rock bottom. The problem is that no one knows exactly when that will be. Some experts encourage investors to stop thinking about rock-bottom and focus on building positions because the stocks you are purchasing today are cheaper than what they were a few weeks ago. Even if the market continues to fall for months, history proves that, with time, it will move up again. This is true even if it takes a few years to reach full recovery.
Should You Invest in an IRA?
IRAs, also known as individual retirement accounts, are a great way for you to save for your retirement. One benefit is that you do not need a lot of money to get started. Most IRAs do not have minimum investment requirements.
Factors to consider when determining whether to open an IRA includes things like your current income, how much money you have saved, and the other retirement accounts you have. Before you invest in an IRA, ask yourself whether you are matching your 401(k) at work. If your employer will match even 50 percent of the money and you invest into your 401(k), then you are getting $.50 on the dollar of free money. It would make little sense to open up an IRA for a thousand dollars if you could put that same thousand dollars into your 401(k) and have your employer match it with $500. That’s an instant 50 percent return on your investment.
If you are ready to open an IRA, you have two options. The first is a traditional IRA. Here you will invest your pretax income. You will pay taxes when you withdraw your money during retirement. The second option is a Roth IRA. This lets you invest tax income. However, when you withdraw the money, the withdraw will be tax free.
Should You Open a Silver or Gold IRA?
For people in the right circumstances, an IRA is a good retirement investment vehicle. Gold IRAs offer you stability that other investment vehicles do not. Physical gold IRAs do not lose value over time and are not affected by inflation. You can prove this by looking at the historical record of gold.
Benefits of gold IRA investing gold IRA investing include:
- Control over the future
- They serve as a hedge in retirement portfolios
- They are disaster insurance for your retirement portfolio
In 1917, for example, you could take a $20 gold piece and purchase a quality suit in a major city like New York City or London. Today, gold hovers at around $1,600 an ounce. With that same gold piece from 100 years ago, you could go to London or New York and purchase a high-quality tailored suit. You would probably have a few dollars left over for a show and a movie for two.
Gold and silver IRAs protect you from the expenses that come from buying physical gold and silver and trying to keep it safe. IRAs are not for people looking for a short-term quick profit. However, if you are looking for something that can withstand fluctuations in the markets caused by unforeseen events, such as the coronavirus, then investing in gold IRAs may be the right option for you.
Please consult your financial advisor. This article is educational in nature, not meant to incite any reader to take action without consulting a professional advisor.