Gold investment: Stepwise guide 

Gold investment: Stepwise guide 

Gold investment holds immense importance and significance for investors. Looked upon as a timeless asset, the gold instrument has been long cherished and continues to be an acceptable and reliable store of wealth. However, you may wonder, why is gold considered so valuable? This is because, the instrument acts as a hedge against economic instabilities, inflation, and currency fluctuations. Explained below is a comprehensive step-by-step guide for gold investing, emphasising its benefits and reasons to invest in this priceless instrument. 

Top reasons for considering gold investment

Wealth preservation

Gold investment assists protect your massive wealth by preserving its buying power over a long time period. For over centuries, gold has considerably maintained its value, making it a well-grounded asset for preserving wealth. 

Safe investment option

Historically, gold has acted as a safe instrument during occasions of political and economic instability. It offers great security and serves as a store of value. 

Inflation hedge

Gold serves as an effective hedge against inflation. As the value of currencies erodes due to rising inflation, gold’s value tends to rise, thus preserving purchasing power.


This instrument i.e., gold by nature is liquid. It easily can be sold and purchased in distinct forms including bars, exchange traded funds or ETFs or gold coins. 


Gold provides diversification features in a portfolio. It has a low correlation with other assets like stocks and bonds, reducing overall portfolio risk.

Universal acceptance

Gold is highly recognised and accepted universally as a valuable store of assets. It easily can be exchanged for money and utilised as security or collateral. 

Offers long-term appreciation in value

Gold has demonstrated long-term appreciation in value. It has outperformed many other asset classes over extended periods, making it an attractive investment option.

Tangible asset

Unlike stocks or bonds, gold is a tangible asset that you can physically possess. This tangible nature adds a layer of security and peace of mind for investors.

Jewellery demand

India has a rich cultural affinity for gold jewellery. The demand for gold ornaments remains strong, which can positively impact the value of gold investments.

Limited supply

As gold is a finite asset, its supply is restricted. As demand increases and supply stays restricted, the gold value is most likely to enhance. 

Central bank reserves

Central banks worldwide hold gold as part of their reserves. This highlights the importance and value placed on gold as a trusted reserve asset.

Geopolitical tensions

Political tensions and conflicts often lead to market uncertainties. In such situations, gold tends to perform well as investors seek a safe haven.

Store of value across generations

Gold has been passed down through generations as a store of value. It holds sentimental and cultural significance, making it a cherished family asset.

Insurance against currency depreciation

Gold acts as insurance against currency depreciation. If the value of a currency declines, the value of gold denominated in that currency usually rises.

GST exemption

Investment-grade gold is GST-exempt, making the instrument cost-effective for you as an investor. Remember that the GSTIN of the dealer must be checked before performing the purchase. Doing so allows you to understand if you are purchasing from an authentic dealer. 

Top benefits of considering gold investment

Wealth accumulation

Investing in gold allows for potential wealth accumulation over the long term due to its historical value appreciation.

Portfolio protection

Gold helps protect your investment portfolio against market downturns and economic uncertainties.

Retirement planning

Gold can be an essential component of retirement planning, providing a stable and secure asset for future financial needs.

Tax efficiency

Long-term gains from gold investments held for more than three years are taxed at a lower rate compared to other investments.

Capital preservation

Gold investment offers capital preservation, ensuring that the value of your investment remains intact.

Inflation-adjusted returns

Gold has the potential to provide inflation-adjusted returns, safeguarding your purchasing power over time.

Easy access

Gold is easily accessible through various channels such as banks, jewellers, online platforms, and authorised dealers.

Psychological benefits

Owning gold can provide psychological benefits, instilling a sense of financial security and stability.

Wealth transfer

Gold can be an effective means of transferring wealth across generations, ensuring the preservation of family assets.

Flexibility in investment options

Gold investments offer flexibility, allowing investors to choose between physical gold, ETFs, or gold-related mutual funds based on their preferences.

Stepwise guide: How to invest in gold?

Following is a stepwise guide on how to invest in gold in 2023:

Decide your financial goals

Clearly define your investment objectives, whether it’s wealth preservation, long-term appreciation, or diversification.

Research gold market

Gain knowledge about different forms of gold investment options available in India, including physical gold, gold ETFs, and gold-related mutual funds.

Fix a budget

Determine the amount you are willing to invest in gold, considering your financial situation and risk tolerance.

Select the type of investment 

Based on your research, select the most suitable investment type that aligns with your goals and preferences.

Figure out reputable sellers

If opting for physical gold, choose authorised sellers or jewellers with a trusted reputation to ensure the purity and quality of your purchase.

Open a demat account (if applicable)

If investing in gold ETFs or gold-related mutual funds, open a demat account with a registered depository participant.

Place your order

Make your purchase either through an authorised dealer, online platform or via a trading account if investing in ETFs or mutual funds.

Secure storage

If investing in physical gold, consider secure storage options such as bank lockers or private vaults to protect your investment.

Track performance

Regularly monitor the performance of your gold investment to make informed decisions and take advantage of potential opportunities.

Planning for tax

Get in touch with a certified tax planner to better understand the implications of considering tax and planning your investments in a manner, which is tax efficient. 


Gold investing offers various benefits, including portfolio diversification, wealth preservation and high protection against rising inflation. The stepwise guide provided here serves as a roadmap for individuals looking to invest in gold, ensuring they can make informed decisions. With its cultural significance and strong demand, gold remains a reliable and cherished asset for investors. So, why wait? Ensure to take up the opportunity of investing in gold for securing your future.