Economic collapse 101: The most important insurance we never buy
Critics such as day traders, short term speculators, and other people who don’t understand the true purpose of holding physical gold and silver, may insist that they expect precious metal prices to drop in the coming years — maybe even precipitously; but those folks miss the point. Whether the price rises or falls, the value of gold and silver never changes in real terms relative to tangible products. What’s really changing is the value of the paper currency used to purchase them.
Remember the gasoline example? That humble Washington silver quarter will always buy a gallon of gas, or a couple loaves of bread, regardless of whether the price of silver rises — or even falls precipitously — after you buy it!
Those who believe in personal responsibility don’t buy precious metals to make money — they buy them to protect the money they already have. Even so, I strongly suspect that less than 1 in 100 people, for whatever reason, actually bother.
Now, like any insurance, you may never need to rely on your gold and silver, in which case you would simply pass it on to your children and grandchildren. Then again, if the day ever comes when you do have to use it, you’ll be glad you had the foresight to protect yourself.
So, whether or not you find yourself laying awake at night worrying about the safety of your hard-earned money, including your retirement nest egg, consider accumulating a little wealth insurance — even if it’s just one American Silver Eagle or Canadian Silver Maple Leaf per month. I promise you’ll sleep a whole lot better at night.
Besides, it’s the responsible thing to do.
Len Penzo is a personal finance blogger with a strong disdain for debt. His blog, Len Penzo dot com, has been featured as one of Kiplinger's Personal Finance Best Money Blogs in 2010 and 2012.