In times of economic uncertainty, many people seek refuge in gold. This raises the question: which is better, buying gold jewelry or bullion?
In this post, we will explain the differences between both options, and provide a comparison with a real example to help you make the best decision for your savings.
Jewelry: Beauty That Costs
Gold jewelry is beautiful and can have sentimental value, but as an investment, it presents several drawbacks:
- Lower Purity: Jewelry is usually 9, 14, 18, or 22 carats (from 37.5% to 91.7% purity), which means less gold for your money.
- Additional Costs: When buying jewelry, you also pay for the design, craftsmanship, and brand, not just the gold.
- VAT Included: Jewelry is subject to VAT, significantly increasing its purchase price.
Investment Gold: The Saver’s Ally
Investment gold comes in the form of bullion or coins with very high purity, also known as "24-carat gold" or "fine gold". A bullion will always be certified and sealed with the term 999.9, meaning:
- Purity: Indicates that the bullion has a purity of 99.99%. That is, out of 1000 parts of the metal, 999.9 parts are pure gold and only 0.1 parts are impurities (other metals like silver or copper).
- Pure Gold: This is the highest purity gold available on the market.
- Certification: The bullion comes with certification that guarantees its quality and authenticity.
Advantages of Investment Gold
The true appeal of fine gold goes beyond its shine:
- VAT Exemption: Unlike other products, investment gold is exempt from VAT in many countries, including those in the European Union. This means an immediate savings of 21% in Spain for example.
- High Purity: By buying investment gold, you are acquiring almost pure gold, maximizing the value of your investment.
- Easy to Store: Gold bullion occupies little space relative to its value, making it easy to store securely.
- Worldwide Recognition: Unlike jewelry, gold bullion is recognized worldwide and is not affected by trends or design.
- High Value: In the case of selling bullion, the price is governed by the market, though commissions vary from one shop to another.
Comparison: Where Does Your Money Yield More?
Let's imagine you have €1000 to invest, considering that the price of gold is €62 per gram:
| Bullion | Jewelry | |
|---|---|---|
| VAT | No VAT | With VAT |
| Purity | Pure Gold | Lower Purity |
| Additional Costs | No extra costs | Includes design and craftsmanship costs |
| Gold Weight | 16 grams | 8-10 grams |
As you can see, buying gold jewelry significantly reduces its value due to taxes and additional costs like craftsmanship and design.
Ease of Sale: Liquidity When You Need It
- Investment Gold: Easy to sell anywhere in the world. Its value is directly tied to the market price of gold. Although the commission on the gold price may vary from one store to another, it is not as significant as with jewelry.
- Jewelry: More difficult to sell for its real gold value. The buyer does not value the design or brand as much as you do. The commission on the global gold price varies from one store to another, unlike Phi Wallet where the commission is always fixed.
Security and Authenticity: Knowing What You Have
- Investment Gold: Comes with certificates that guarantee its purity and weight. It is easy to verify its authenticity.
- Jewelry: The purity can be difficult to determine without testing. The actual gold weight is not always evident.
In conclusion, if your goal is to save and protect your money, investment gold is clearly the best option. It offers more value for your money, is VAT exempt, easier to sell, and its authenticity is easier to verify. Jewelry, though beautiful, is more a purchase of pleasure than a long-term investment.