How to Buy Gold in Australia
If you want to make an investment that holds its value, there are few better options out there than gold. In times of high inflation, it’s always a worthwhile investment, frequently outperforming the stock market. But investment is never simple, so it is always important to understand the process before taking the jump. Here, we will take a look at how to buy gold in Australia and benefit from its durability as an asset during the tumultuous moments of the present and future.
Why Invest in Gold?
A good reason to invest in gold is its intrinsic value and stability as an asset. During times of crisis, it’s a commodity that survives well while others can be buffeted by market conditions. During economic and political instability - which are currently ever-present conditions in parts of the world - gold tends to rise as the market falls. As a material it is stable and doesn’t corrode, underpinning its durability.
As an example of how gold performs when other assets are struggling, we can look at the early months of 2020. As global markets were dealing with the Covid-19 crisis, gold prices exceeded US$2,000 per ounce, adding $500 to its price in the first eight months of the year.
Types of Gold Investments
So, how do you go about buying this useful commodity? There are a number of ways: you can buy gold bars; gold coins; golden jewellery; ETFs and stocks; or you can open a gold-backed savings account which offers the confidence of regular banking and the security of gold. What you choose is up to you, each has its own benefits and detriments. Gold bars are steady, but more expensive; coins are versatile and usually found with a lower premium; jewellery tends to be lower in value but is easy to buy and sell; ETFs provide greater liquidity while gold-backed accounts are easier to access.
Researching the market
If you want to buy gold, then you must research the present market to understand where you are best placing your investment. This means staying in touch with every resource you can find to learn what’s going on with different ways of investing. Take into consideration the global economic picture and the price of gold by keeping an eye on financial news websites and the World Gold Council. The best time to buy may be during relatively settled times, so you can then benefit from price rises in more disturbed periods.
Make sure you are working with reputable dealers to ensure fair prices and viable licensing. The Perth Mint and ABC Bullion are two potential sources for gold investments.
Choose the type of gold
The way you buy gold makes a difference. As we mentioned above, there are many different ways, each with their worthwhile benefits. To go deeper, let’s run through some of those options now:
Gold bars
Buying gold in bar form has the advantage of being cost-effective if bulk investment is your intention. They are available in various sizes and the premium over the spot price of gold is generally low. ABC Bullion Minted Gold Tablet 1oz is an example of a product you might consider.
Gold coins
Coins are easier to buy and sell in smaller quantities, meaning that you won’t have to tie up as much in the way of funds if you are looking to invest dynamically. Australian investors might prefer the Australian Kangaroo as an option, although Canadian Maple Leaf and American Gold Eagle coins are also popular.
Jewellery
Jewellery works best as a personal investment, but it should be recognised that it comes with higher premiums due to the craftsmanship and design involved. Learn as much as you can about the purity and weight of any piece you wish to buy, as this can govern the price you get should you wish to sell.
Gold Granules
If you want to start smaller, 1 Gram 24 Karat Pure Gold Granules may be your best option to invest in gold. These granules can be bought in smaller quantities and benefit buyers who want to keep a diverse strategy.
Your background reading on the topic will also point up ways to buy gold in moments of maximum opportunity, so always have an eye on the economic forecasts and finance sections of daily newspapers.
Where to buy gold in Australia
First-time gold buyers are recommended to ensure that they are buying gold from established brokers who have solid reputations and proven licences. This is the soundest way to ensure a credible price and appropriate legal recourse should it be necessary. The following are some examples of reliable, honest brokers.
Trusted dealers
Generally recognised as the most reliable gold dealers in Australia are the likes of the Perth Mint who do the refining and provide gold, silver and platinum products and services to markets throughout the world.
There are many local dealers in major cities with longstanding reputations. Bullion Hub is a trusted dealer in Melbourne for buying and selling precious metals.
Online platforms
Offering convenience and easy access - as well as being sources that you can buy from while eyeing the market in another browser tab. It is also possible to buy gold from eBay, but due to the proliferation of unreliable sellers on that platform, we’d recommend that you don’t.
As gold is a major investment, we recommend dealing with a local business that you can call and visit.
Coin shops
There is a benefit to buying from coin shops if you feel you can recognise quality gold. The ability to buy face-to-face means that you can view the pieces before purchasing, with Gold Stackers and Jaggards being among the most popular. You can also buy from private sellers, but unless you can be absolutely certain of their reliability, it’s recommended that you avoid this.
Consider Storage Options
Once you have purchased gold, it is important to consider how it should be stored; there are a few worthwhile options which we’ll look over now.
At home
If you keep gold at home, you’ll always know where it is, which is good for peace of mind. Remember though that there is the risk of theft, fire and natural disasters so it needs to be kept safe, ideally in a locked safe which has foolproof locking mechanisms.
Bank vault
You will have to pay to store your gold in a vault, but it does come with the advantage that insurance costs are likely to be lower due to the increased security. It’s hard to say how much you’ll need to pay; that depends on the size of the box used for storage.
Bullion dealers
You may choose, if buying from a dealer, to leave the storage in their hands. This will guarantee privacy and security, although again you will have to pay for the privilege.
Conclusion and FAQ
As long as you keep yourself informed, investing in gold can be a very beneficial and safe way to invest. Remember the importance of buying and selling at the right times, and the need to store your gold securely and to insure it. And if you have any further questions, read on.
What is the best way to buy gold in Australia?
This depends very much on your investment goals. If you want a bulk investment, then gold bars are an ideal way to buy gold. If you prefer greater liquidity, then gold coins are recommended instead.
Is gold tax free in Australia?
On the surface, yes, as long as gold meets the purity standard of 99.5%, it is exempt from GST. However, selling it may be subject to capital gains tax - it’s always best to consult a tax expert to know where you stand personally.
How much is a 1-kilo gold bar in Australia?
Of course, the price fluctuates so there is no set amount we can state here. However, the stability of gold means that the price of a 1-kilo bar will generally range between AU$115,000 to AU$125,000 as of mid-2024. To be sure, check Bullion Hub's gold price tracker which will have exact prices updating down to 10 minute increments!
Can we buy gold from a bank in Australia?
Yes, you can. Banks like ANZ and HSBC do offer gold-buying services. However, generally the prices on offer from dedicated gold brokers will be better.