The 1000-year-old Royal Mint gold bullion are now available to everyone. Since 2016, gold bars that weigh 100 grams to 400 ounces may be purchased and owned by pensioners or investors through the Royal Mint Signature Gold service. Their gold will then be stored in a highly secured bullion vault storage facility.
This is great news because it allows ordinary people to have gold within their small self-administered scheme (SSAS) or self-invested personal pension (SIPP). They can now buy, sell, and store gold coins. Those who want to know the current prices of gold can check out the bullion trading website of the Royal Mint.
Chris Howard, Royal Mint bullion director, assured investors that they can rely on the Royal Mint to provide and manufacture coins at a global scale. The annual fee for storing gold is 1% plus VAT for gold bars, depending on the average daily market value of gold. The storage fee for Signature Gold service, on the other hand, is 0.5% plus VAT, depending on the average daily market value of gold.
Then again, chartered financial planner Danny Cox said that investors should take note that investing in gold is not a one-way bet. After all, gold is not easy to value and is subject to demands. It also does not produce income for its investors, unlike bonds and shares. In other words, the price of gold tends to be unpredictable.
So, how can private individuals purchase gold for their pension from the Royal Mint?
They can go to the bullion trading website and download an application form to fill up. When that is done, they should send it to an SIPP provider. They would then receive an online account that they can use to purchase and manage gold.
Small Self-Administered Pension Schemes (SSAS), which are pension plans managed by companies on behalf of top directors and other people may also set up accounts wherein they can purchase gold from the Royal Mint.
Why should anyone invest in gold?
Gold can serve as a hedge against crises, such as financial hazards and inflation. This is in spite of the fact that gold prices are volatile. They can be influenced by numerous factors, such as hedge fund plays, physical gold demand, and central bank purchases.
How about the disadvantages? What are the possible drawbacks of purchasing gold as investment?
For starters, not every SIPP provider offers SIPP’s with total investment flexibility for physical gold. Purchasing physical gold can also come with high insurance costs and storage fees.
This is unlike purchasing Britannia gold coins, which are exempted from VAT and Capital Gains Tax. Those who hold, buy, and sell these coins do not have to pay any tax.
What do the experts say about this move?
Various pension experts have given their opinions with regard to this move by the Royal Mint. Fidelity International investment director Maike Currie, for instance, stated that one of the major advantages of SIPP’s is its investment flexibility.
The addition of gold in its list of eligible investments is such great news. A lot of investors turn to gold during times of uncertainty. They purchase gold whenever they feel anxious about the future.
Then again, investors are advised not to have more than 5% of portfolios in gold. They can turn to other investment options, such as Exchange Traded Funds (ETF’s).