This simple guide on How to Buy Gold in Australia will help everyday investors new to buying gold. In this post, we explain why it’s a good idea to own gold. And we will provide a step-by-step guide on how to buy gold in Australia. From physical gold to ETFs and digital gold. We will cover all the options right here.
We also cover my experience of buying gold for the past few years. And we discuss some insights from my journey of buying precious metals that can help readers to buy gold in Australia. Let’s Kick it in.
How to Buy Gold in Australia
Gold is an investment that is difficult to explain to everyday investors. There are no dividends, the price can fluctuate day after day. And it can seem unnatural to buy a physical metal and store it. Effectively letting it do nothing. So it can be difficult to understand the point of buying gold.
The slow and steady growth of gold makes it seem like an old man’s game. Designed for Boomers and those not in the hip-passive investing ETF game. But there has been a “modern boom” in gold investing. Gold sales continue to increase across the globe. Countries like China are on a gold-buying spree, buying record amounts for 15 months straight. China recently bought 10 tonnes of gold in January 2024.
Every day investors are starting to see the value of buying and owning gold. But it’s important to understand gold investments before starting any real investing.
Understanding Gold Investments
Throughout history and literary books, gold has been glorified. Homer’s Illiad and The Odyssey both mention gold as “the glory of the immortals and a sign of wealth among ordinary humans”. That is part of the allure of gold, there is a mythology and a beauty to the precious metal.
Gold has always been valuable. Beginning from ancient civilisations such as the Egyptians to modern-day society. Gold has been used as money and as a store of value. And it continues to be an important part of financial markets to this day. As central banks and investors buy record amounts of the precious metal, this ancient form of money is still a valuable investment.
Let’s understand why we should invest in gold.
Why Invest in Gold?
Gold is often described as insurance, as it tends to perform well in a financial crisis when other assets struggle. And according to a 2017 Gold survey by the ASX, 85% of Australians don’t own any gold. And 45% of Australians have never thought about investing in physical gold. The survey claims that Aussies tend to miss the most fundamental investing concepts for why gold is essential. And that can explain why so many investors don’t own any.
There are many reasons why we should invest in gold. Here are few reasons why you should invest in gold.
1. Gold is Important for Diversification
Gold experts, like Jim Rickards and Peter Schiff, have often recommended that gold should be part of any diversified portfolio. A rule of thumb is to have 5-10% of your investment portfolio in gold. This allocation should complement other investments such as housing or shares. As it can be seen as insurance in the face of financial catastrophe. In turbulent times when stock prices fall, gold is seen as a “safe-haven” investment that increases.
2. Gold is an Inflation Hedge
Inflation is a real problem in Australia and across the globe. It is described as a “hidden tax”, and it reduces the purchasing power of your money. Governments print money into existence, prices increase and the Australian dollar is devalued. Every year it can buy less, effectively making you poorer.
Governments don’t like gold because they can’t print it. Gold holds its purchasing power as inflation reduces the value of paper money. Famous Gold investor Robert Kiyosaki describes Gold as “God’s money”, and its value continues to increase over time.
3. Gold is a Safe Haven Investment
Precious metals like gold and silver are “safe haven” investments. These assets will retain or increase in value during economically turbulent times. Gold is a way to transfer paper money into physical money, knowing that the asset will always hold its value in any country around the world. It can be seen as a way to have real money outside of the banking system and in your hands in case of a bank failure. In a financial crisis, gold will help you survive any potential economic threat. That is why gold is considered a “safe haven” asset.
4. Gold is a Historical Store of Wealth
Throughout history and across cultures, gold has been a store of wealth. The limited supply and beauty of the metal have always made it valuable. Gold can last forever and it doesn’t decay or diminish over time. There is a limited supply, it cannot be printed and requires effort to dig out of the ground which makes it valuable. And gold is always in demand. There are many buyers always ready to buy precious metals. Making gold highly liquid and an asset used to build generational wealth.
How to Buy Gold in Australia (Types of Gold Investments)
There are various ways how to buy gold in Australia. They all have distinct advantages and disadvantages. Let’s take a look at how to buy gold in Australia in order of simplicity for new gold investors. This is based on my personal experience of buying gold and the natural progression I followed in buying it as I moved from digital gold to physical gold. Let’s take a look.
1. Gold ETFs
Gold ETFs are the simplest way for any investor already familiar with trading to buy some gold for their portfolio. Some Gold ETFs hold physical gold bullion and it is a low-cost, simple way to invest in physical gold.
- Advantages of Gold ETF: Gold ETFs are appealing because you get all the advantages of owning gold, without the need to store it. It is also simple to buy and sell through your preferred brokerage platform. This lowers the barrier of entry for any investor who wants to invest in physical gold ETFs.
- Disadvantages of Gold ETFs: ETFs for physical gold are a great idea, but you don’t physically own the metal. However, some ETFs can be redeemed for physical gold in the future which is a great option to have.
- Gold ETFs to Research: There is some nuance to investing in Gold ETFs. They are not all exactly the same, and you will need to do some research to find what is best for you. I have personally invested in the Gold ETF (ASX: GOLD) from Global X. This is physically backed gold and could potentially be a good option to research.
Another option is ASX:PMGOLD, which is managed by the Perth Mint. It is the world’s only government-guaranteed precious metals company. - Gold ETFs Summary: Gold ETFs are the best way to hold an investment in gold, without physically owning the metal. It’s a great way to dip your toe into gold investing. And it removes any potential downsides of investors who don’t want to physically hold and store blocks of metal. A Gold ETF is the perfect way to get started but you will need to do some research on what gold ETF works best for you.
2. Gold Investing Apps
After Gold ETFs, the best way to digitally own physical gold is through a gold investing app. These Apps can be used to securely and easily buy physical gold bullion and some are regulated under Australian law.
- Advantages of Gold Investing App: Gold Investing Apps are a great way to buy small amounts of physical gold bullion. The apps themselves are pretty slick and provide a nice interface to buy and manage your gold holdings.
Buying through an App is different than through an ETF, as it gives you direct title to the physical bullion. And any gold holdings can be converted into physical gold in the future. - Disadvantages of Gold Investing Apps: Buying, selling, and storing gold through an app will incur small fees that will slowly add up. And the novelty of having a special app for trading gold may wear off.
- Gold Investing Apps to Research: Rush Gold is an Australian gold App that is regulated under Australian Law. It is free to set up and you can buy and sell gold or silver through the app. There is also a feature where you can spend your gold holdings via a linked Rush Gold Debit Card. It is an interesting idea to use gold for everyday purchases.
It’s also worth noting that the Perth Mint had a similar gold investing app called GoldPass. Unfortunately, it was closed down in 2023. - Gold Investing Apps Summary: Gold Investing Apps are a nice way for gold newbies to get interested and invested in the physical gold market. The App has a familiar feel to other investing apps but it is specific to precious metals. It’s easy to download and set up. So it might be worth testing it out to see if gold investing is for you.
3. Physical Gold
Apps and ETFs are a fantastic way to get started when buying gold. But most gold bugs will prefer physical gold because you can hold it in your hand. It is “real money” and it holds its value over time and can’t be inflated away like our fiat currency.
There are gold dealers across Australia who can help any investor buy gold or any precious metals. Most gold dealers will have a website that can help your gold-buying journey. These websites are a great way to get familiar with the different types of gold that are available. This includes gold coins, bars, granules, buyback gold and limited edition bullion. It’s a fantastic way to look at the designs, the value and prices of any potential gold purchase.
Gold dealers are also a fantastic resource of information. Email them with any questions, or go into their stores and they will help you buy what works best for you. Every state has multiple metro and suburban gold dealers. And it is just a matter of visiting these stores and finding which one is right for you.
- Advantages of Buying Physical Gold: Gold has a 5000-year history of being used as money and a store of value. Famous gold investor Lynette Zang says “if you don’t hold it, you don’t own it.” You need physical gold in your possession and outside the banking system. This “safe haven” asset is the ultimate form of insurance in times of financial turmoil. And as an investment, it isn’t unusual for gold to beat the S&P 500
- Disadvantages of Buying Physical Gold: Investors may not like owning physical gold because you need to store it somewhere safe. And if you want to sell your gold, you can’t just trade it online. You need to find a bullion dealer and sell it.
Buying physical gold from investors who are not bullion dealers could also get risky, as gold can be faked or counterfeited. - Physical Gold Research: An easy way to get started to buy physical gold or any precious metal is via the Perth Mint Online Store. The Perth Mint is owned by the Western Australian Government. They supply gold dealers with their Bullion across the country and globally. The Perth Mint can ship gold out to you, and it is a fantastic way to start investing in gold (or silver). Their website is a great resource for those looking at how to buy gold in Australia.
Buying gold online is convenient and easy. But it’s also great to visit a local store and buy gold in person. The store may have more stock than is listed on its website, and you can get better deals on buyback options (second-hand gold). This means you can buy more gold for less.
Buying gold in-store is also a more enjoyable experience. It is fun to browse and chat in-store, and you can buy gold and take it home that day. This is a better option than waiting for deliveries of precious cargo in the mail. - Physical Gold Summary: There are many stores and dealers across Australia where you can buy gold. It’s just a matter of some research, finding a dealer, and visiting the store. It’s great to build a relationship with your gold dealer. Then you can become aware of new gold releases, special bullion, and deals that come up.
4. Gold Mining Stocks
The next level of buying gold is to buy a gold mining stock. Mining companies explore for gold resources, develop mines and then sell gold. Gold Bugs that believe in the value of gold, will also be on the lookout for gold mining stocks to invest into.
ETF investors also have a few options available in Gold Miners ETFs. These are a less-risky, low-cost option to invest in the best gold mining companies around the world.
- Advantages of Gold Mining Stocks: Investors like Peter Schiff believe that Gold Miners could 50-100X in the future. If the price of gold increases, a gold miner could increase exponentially as Schiff predicts. There are various gold ETF or mining stocks available for any gold bug that wants to go next level.
- Disadvantages of Gold Mining Stocks: Gold Mining Stocks can be wildly speculative and risky. They can be difficult to pick and there is no guarantee the mine will be successful. And the value of gold mining stocks can depend on the gold price which fluctuates based on the economy.
Gold ETFs won’t give you a solid return like a standard ETF, so you would likely treat that as a speculative asset also. And try not to have too much invested in it, to minimize any potential risk. - Research of Gold Mining Stocks: There are various gold miners in the ASX, with Newcrest (ASX: NCM) and Northern Star (ASX: NST) being the biggest gold miners in Australia.
It can be difficult to pick gold miners, so a lot of research will be required to find the type of miner that will align with your risk appetite.
Looking at ETFs, the VanEck Gold Miners ETF (ASX: GDX) is a popular option. This ETF has the biggest mining companies from around the globe within it. And it is a simple way to get exposure to global gold miners. There are differences across all gold ETFs. Some may include other precious metal producers (like silver miners) and mining royalty companies. So please, do your research and pick something that looks good. - Gold Mining Stocks Summary: Australia is the second top gold-producing country in the World. We have world-class mining assets that are critical for gold production across the globe. Research in gold mining is essential and interesting when you dig deep enough into the details. And it’s a worthy exercise if you want to speculate with gold miners in your portfolio.
Read Peter Schiff’s Gold Stocks to 50x and Gold Junior Miners to 100x prediction in this popular Moneyman Post. Some great predictions in there from Peter Schiff.
5. Investment Jewellery
Serious Gold bugs will buy gold bullion in coins, bars or stocks. But it can be difficult to appreciate these assets when they are locked away and not seen. So it’s not unusual to supplement gold bullion with gold jewellery. This “wearable wealth” is an interesting way to accumulate gold that is wearable and beautiful.
- Advantages of Investment Jewellery: Investment jewellery is designed to be an investment and is sold by weight with a premium on top. This provides an opportunity to wear your investment and enjoy it daily.
Women may be more inclined to accumulate wearable investments when compared to gold coins or bars. And men may be more likely to invest for their wives and girlfriends, knowing the intrinsic value. This is a win-win for all and it’s a fantastic idea for gold lovers. And lovers in general. - Disadvantages of Investment Jewellery: The premiums on wearable investments are high. And wearing investments has a higher likelihood of being lost or stolen.
- Research for Investment Jewellery: Mene is an Investment Jewellery company that provides jewellery by weight with a 30% premium for the design and manufacturing. Mene ships to Australia, but it is expensive if you like their style of investment jewellery.
- Summary of Investment Jewellery: Investment Jewellery that is sold by weight is an interesting idea. And the ability to “wear your wealth” would be appealing to investors who want to enjoy their gold.
My Personal Experience Buying Gold
As an experienced investor, I have invested in many things over the years. Coming from a background in financial tech, I enjoyed investing in tech stocks. And anything tech-related.
I became interested in precious metals after seeing an interview with Peter Krauth about silver and precious metals. After I read his book “The Great Silver Bull“, I discovered other Gold and Silver investors like Peter Schiff, Mike Maloney and Robert Kiyosaki. After many hours of research, I decided to buy precious metals for speculation (silver) and insurance (gold).
I had no idea about buying or storing precious metals, so I started by buying digital gold and silver. Using the Perth Mint GoldPass App, I dollar cost averaged into this App for a year. As I became more comfortable with buying precious metals, I started to dislike the purchase and holding fees.
The GoldPass App was eventually shut down. This was my opportunity to cash out of the app and rebuy my precious metal holdings from the Perth Mint through their mail-order service.
My first order from the Perth Mint was fantastic. I enjoyed receiving the real metals, as I could touch and hold my gold and silver. The experience was great and I continued to make orders from the Perth Mint until I decided that I didn’t like paying for postage and waiting for orders to arrive. I just wanted to buy gold and silver more regularly without the extra cost and waiting time. I discovered a few stores in Melbourne that I tested out. And eventually, I found one that I enjoyed visiting and now I go back often to buy gold and silver.
By this point, I also bought gold and silver ETFs, and I did buy into some small-cap gold and silver miners on the ASX. So my gold and silver buying journey aligns with what I recommend is a logical progression of buying precious metals. And that is the basis of why I wrote this post, using my experience over the years.
Please note, in my gold-buying journey I haven’t tried any new gold apps. I may test those out in future to compare them to the old GoldPass App. And I haven’t bought any Investment Jewellery….yet.
Final Thoughts
In this guide on how to buy gold in Australia, we covered all the bases. As the World continues to buy gold, fearing a financial catastrophe, gold is a safe-haven asset to protect you in such times. The “big money” is buying gold, global central banks are buying record amounts of gold, and you have to wonder, what do they know that you don’t?
If you want to buy gold, you need to understand why you want it. And be comfortable with how much you are willing to pay for it, and know the best way to buy it. Digital gold is a nice way to get started, but the saying goes “if you don’t hold it, you don’t own it”. And you won’t truly appreciate it until you hold that beautiful bullion in your hands.
With so many options to buy gold, we hope that this guide has given you some ideas on how to buy gold in Australia. And hopefully, my journey and experience can help readers understand what is available. And hopefully, has helped guide new investors in how to buy gold in Australia.
Let me know if I missed anything, or if you bought any gold after reading my post.
M. Moneyman
FAQs
Is buying gold in Australia a good investment?
Buying gold in Australia can be a smart investment option as it offers a hedge against inflation and economic uncertainties, but it’s important to diversify your investment portfolio and understand the risks involved.
Where can I buy physical gold in Australia?
Buying gold in Australia can be a smart investment option as it offers a hedge against inflation and economic uncertainties, but it’s important to diversify your investment portfolio and understand the risks involved.
What forms of gold can I buy in Australia?
In Australia, you can buy various forms of gold, including gold bars, coins like the Australian Kangaroo or Lunar series, and gold-backed ETFs (Exchange-Traded Funds).
Are there taxes on buying gold in Australia?
In Australia, gold bullion purchases are generally exempt from Goods and Services Tax (GST) if the gold meets certain purity criteria, but it’s essential to consult with a tax advisor for personalized advice.
How do I store gold securely in Australia?
You can store gold securely in Australia through options such as allocated storage with reputable vaulting services, safety deposit boxes in banks, or secure home safes. Evaluate the costs and risks associated with each storage method.
References
- Rask Media: Best Gold ETFs in Australia
- Robert Kiyosaki: Gold and Silver are God’s Money
- Chris Soschner: Is Gods Money a Good Investment
- Peter Schiff Gold: Half of Australians Never Considered Investing in Gold
- Gold.Org: What time is a good time to buy gold in Australia
- Forbes.com: Inflation, a sneaky tax on everything and everyone
- Investopedia: Why has Gold always been valuable
- MetalTek: The History of Gold
- USGlobalETFS: Gold has beaten the S&P 500 so far this Century
- Investing News: Australia’s Top Gold Miners
- HelloStake.com: Top Gold Stocks in Australia
All other insights were from my personal experience when buying gold and silver in various ways, as documented in this post.
