Gold has long been a prized asset globally, sought after by central banks, institutional investors, and individuals alike. For decades, India has been one of the largest consumers of gold, and the yellow metal plays a significant role in the country’s culture. Through centuries, Indians have shown a deep appreciation for gold, especially during traditional and auspicious occasions like Dhanteras and Akshaya Tritiya, which have become synonymous with gold investments.
With the festive season upon us, it’s time for celebration and joy. With gold prices touching an all-time high of Rs 80,000 for 10 gms, The All India Gem and Jewellery Domestic Council (GJC) predicts a 30 percent surge in retail sales this festive season.
Many people love investing in physical gold due to tradition or custom, but often overlook the fact that additional costs, like making charges, can be 15-20% higher on average. Moreover, after factoring in GST, concerns about purity and storage come into play. Physical gold—whether in the form of bullion, bars, coins, or jewellery—derives its value from the actual gold content, but these considerations can make it less cost-effective.
Also Read: Fixed deposits offering up to 9% during festive season – Compare best FD rates
With the introduction of more convenient options, now is a great time to uphold tradition while also making smart, future-focused investments. Here are some smarter, cost-efficient alternatives to consider:
Sovereign Gold Bonds (SGBs) offer the security of government backing along with interest payments and tax benefits if held to maturity. However, they come with a fixed maturity period, and gold prices can fluctuate during this time.
Gold Exchange-Traded Funds (ETFs) are traded on stock exchanges, making them liquid and offering diversification benefits. They have low expense ratios but are subject to market fluctuations.
Gold Savings Funds invest in gold-related securities, providing diversification and professional management. These funds may have minimum investment requirements and offer the convenience of investing through lump sum or systematic investment plans (SIPs), allowing investors to save and accumulate gold over time.
Gold Savings Schemes offered by jewellers are often seen as easy and convenient, with attractive discounts on jewellery purchases (e.g., through reduced making charges). However, they tend to come with higher charges and offer less flexibility compared to other options.
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