It is well known that fiat money loses its value in the course of the time. Therefore, it is not recommended to have too much of it in cash or in the bank account. The guiding rule is – you should have as much cash as you might need in an emergency (unemployment, illness, force major) to cover about 3-4 months of your day-to-day needs.
The rest should be placed securely in alternatives which help to save purchasing power and the current value of your wealth.
There are common and less usual options on how to place your money efficiently.
When talking to people, most will probably mention real estate purchase at first place. This is a valid option to invest your money. But do not forget that the location is crucial in this case. Just keep in mind: real estate is an immovable asset. It cannot change its location if, for example, the political situation in the country would get worse and/ or you as the property owner would get new and unexpected obligations in form of additional property levy, legally imposed modernization costs etc. But property is a special topic worth deep diving into in a separate article.
Another commonly known option for money placement would be shares and stocks. It is also a very valid and broadly used possibility. But if you are not a trader and do not have a good knowledge of what you do on the stock market, the probability of losses is relatively high. This market is also very volatile and requires regular attention from your side. On top, shares, securities, stocks and bonds highly depend on the company performance or ratings.
There are a bunch of lesser-known options, like investing in old-timers, whiskey, art objects, music etc. But these investments can be also pretty volatile in their value. And again – you need to know what you do and have trusted consultants for such kinds of investments. I’m not even talking about the storage place for some of such investments and the costs of maintenance. If you own a dozen old-timers, you need sufficient space to securely park all of them, and missing or rare spare parts could cost a fortune on its own if needing a replacement as (depending on the car model) many of them are not produced any more.
There is another asset protection possibility which many people do not have directly on their radar even though this possibility is evident and in use for thousands of years.
I’m talking about precious metals, like gold or silver.
Precious metals have an intrinsic value and are tangible. And from the historical experience of several thousand years, gold and silver keep their value and purchasing power throughout ages and centuries, while fiat money steadily loses its value resulting sooner or later in inflation and monetary reforms. This quality of precious metals, and especially of gold and silver, ensures that they are equally welcome in all countries of the world. A kind of a world money, even in times when any fiat currency can become absolutely uncertain.
Talking about inflation: during turbulent periods, when the fiat currency loses its value and the prices are increasing, the prices of gold and silver go up in accordance with the overall inflation. This allows to keep the purchasing power of the metals.
Just as an example: if you observe how the prices of one liter beer at Octoberfest in Munich developed over the last years, you will obviously notice that each year the price of one Mass (one liter) climbed to new heights.
According to statista portal (https://de.statista.com/statistik/daten/studie/272209/umfrage/bierpreisentwicklung-auf-dem-oktoberfest-in-muenchen/) the price of one liter at Octoberfest was:
2015 – ca. 10,35 euro
2019 – ca. 11,80 euro (increase of 14% compared to 2015)
2024 – ca. 15,30 euro (increase of 48% compared to 2015 and 30% compared to 2019).
If you would like to (and could) purchase the beer in gold instead of euro, however, your beer price in gold ounce was permanently going down:
10 years ago, one ounce of gold had a price of 966,89 euro. For one liter beer at Octoberfest (10,35 euro), you would need to pay 0,0107 ounce.
5 years ago, the price of one ounce of gold was 1336,67 euro. At a price of 11,80 euro per liter you would need to pay 0,0088 ounce of gold.
In 2024 the price of one ounce of gold during the Octoberfest was 2410,09 euro. For one liter beer you need to get ready 15,3 / 2410,09 = 0,0063 ounce of gold.
(Gold prices are taken from https://www.boerse.de/performance/Goldpreis/XC0009655157)
As you see, in ounce of gold the price of one liter beer got cheaper by 37% within 10 years, while at the same time it got more expensive by 48% in fiat currency (euro).
This comparison you can do over longer periods of time and for many different products. A tunic in Roman Empire or a costume nowadays would require approximately a similar amount of gold. 1kg of bread 2000 years ago or today would cost around the same amount if you pay it in gold. In the last 2000 years each country had a lot of different fiat money versions and a lot of different currency reforms. But gold remains gold and keeps its purchasing power.
Let’s take another example: it is the year 2006. You got a child and opened a savings account for him or her. This is pretty usual in many countries to gift the child with a nice amount of money when he or she reaches the majority age. To simplify the calculation let’s imagine that you paid at once 10.000 euro in the account back in 2006. In the year 2024 the child arrived at his or her majority and receives around 12.700 euro in total including interest rate payments (https://www.zinsen-berechnen.de/tagesgeldrechner.php) assuming an average interest rate of 1,5% (keep in mind that during several years the rate was even below 0,1%! This is not yet taken into consideration). But the loss of purchase power in the same period of time is more than 30% (https://www.finanz-tools.de/inflationsrechner-kaufkraftverlust). At the end, your child can purchase much less for the total amount on his or her savings account than it was worth 18 years ago.
If you would have invested the same 10.000 euro and purchased gold at the birthday of the child (634,50 euro per ounce back in 2006 = 15,76 ounce put into the vault dedicated to the child), at the majority in 2024 this amount of gold with the actual prices in October 2024 (2521,90 euro per ounce) would mean that the child would have 39.745 euro in gold (nearly 4 times more than the invested amount).
In this case, the argument against gold that fiat currency brings interest rates in the account does not work anymore.
Back in 2006 you could easily purchase a VW Golf for 10.000 euro. Would your child be able to purchase a VW Golf in 2024 at his or her majority with 12.700 euro in savings account? Probably not or in a very bad condition. With 39.745 euro? Definitely yes. This is another example of conservation of the purchasing power by precious metals.
Precious metals gain another positive momentum if we talk about taxes. You can argue that shares and stocks can allow us to gain much more than precious metals. This surely can be the case, especially if you know exactly what you do on the stock exchange. However, the earnings you achieve through trades on the stock exchange are taxable in most countries. For example, in Germany they are taxed at 25% rate if you trade on the personal level and exceed your personal exemption limit. Precious metals and the earnings from them are absolutely tax-free in many countries under certain conditions. In Germany, for example, you just need to hold them at least one year before selling to be tax-exempt.
Let’s take again the example of the gold price development from 2006 to 2024. In total, the gold price raised by 397,46% (2521,90 euro / 634,50 euro) or by 22% p.a. in average in the course of 18 years. You get the whole benefits tax-free. In order to get the same earnings after taxes with stock exchange, your papers should perform a quarter better (25% taxes) or reach 27,5% performance in average over all 18 years, if you reside in Germany. And in this case, they would just be on parity with gold, not yet outperforming it.
You might argue that precious metals are something only for wealthy people. At the end, you probably do not have free money on your current account to purchase directly a gold bullion of 1 kg worth over 80.000 euro. And even if, it would be not safe to keep such bullion in your home.
Fortunately, there are solutions which do not require a huge bunch of money at once and are even safer than a safe in your own home. And I’m not talking about gold certificates or any other papers. It’s about physical precious metals which are registered as your personal property and are safely stored in a highly secured and safe duty-free storage facility. If you want, you can ask them to be physically delivered to your home (but does it really make sense?).
Why a duty-free option is so important, if the metals are exempt from taxes? Well, white metals (like silver) are charged with VAT in many countries if you purchase them physically in a shop. When you buy them, and they do not leave the duty-free area (storage location) you can save the VAT and use this saved money (for Germany it would be 19%) to get 19% more metal in your vault. The VAT would be charged only in the event of a physical delivery to you. If you buy the metal into your vault in a duty-free location and sell out of the same duty-free location, the VAT will not be charged.
Do you need to purchase a complete bullion to be a legal owner of it? The answer is: NO, you don’t. You can start purchasing metals and stock up your vault already from 1 EUR/ USD/ CHF/ GBP onwards. You will be registered as a partial owner of the bullion with the purchased quantity of the metal.
The biggest advantages of buying metals and keeping them in a duty-free storage in Switzerland:
- Highly secured
- Clear ownership
- The storage is insured to 100% (even in an unlikely event of a full loss you have an insurance equal to 100% of your metal value)
- Affordable storage costs (one of the lowest worldwide!)
- Flexible purchase and selling at any time from 1 EUR/ USD/ CHF/ GBP
- Our partner purchases metals at the prices of bullions and charges you the prices of bullion even if you purchase just a small fraction of it. Already with the price difference between prices for bullion or smaller quantities (if you would purchase them on the free market) you can save up to 14% for gold and up to 30% for silver.
- One-off purchases or savings plans with regular payments are possible
- Access to silver, platin and palladium in addition to gold
- VAT-free (as long as the white metals are not delivered physically)
- Transparent prices and attractive pricing (one of the lowest world-wide!)
- Processing in different currencies possible
- 100% digital access via app – simple, convenient and secure
- Physical delivery possible (gold, platin, palladium from 1g, silver from 20g) to many countries in the world
- potential gold ban in your country (happened several times in the past in Germany, in the USA and in several other countries) does not impact you as your gold is not at all in your country, but in a duty-free storage in Switzerland
Singabiz is partnering with one of the biggest metal trading companies in Europe: our partner trades every year over 500 billion CHF, has over 200.000 satisfied customers, over 250 banking partners worldwide and over 2.500 financial service providers. It holds the required certification and was rated as the “Best Provider of Gold Savings Plans” by Focus Money Germany magazine during 9 years in a row. It was also rated as the best one in categories of contract conditions, best service, best price and best storage and delivery.
Registering is very easy and free of charge. You just need to download the application via our special link: https://go.flexgold.com/c/DWUH5
Why should you use our link instead of going directly with Flexgold? Well, we have better conditions than going directly. Going via Singabiz you ensure that you will have (on top of all other benefits) a lifelong discount of 20% on transaction fees and storage fees. And this discount can go up to 45% if your vault value reaches 250.000 CHF in the course of the time. The discount adjustment happens automatically, you do not need to do anything.
Installing the app and starting the purchase is easy:
- Download the app: https://go.flexgold.com/c/DWUH5 (the app recognizes the settings of your phone and installs either in German or in English)
- Create your account
- Get verified (KYC via a Chatbot and verification via IDNow)
- Create your first vault and transfer to it your first amount you would like to invest (important: you need to use this amount for the metal purchase within 40 days else it will be sent back to your bank account)
- Purchase desired metals and observe how their value goes up
This offer is not only for corporate and business customers, but also for any interested individuals.
And in case of any questions, you can be sure to enjoy the usual excellent support of Singabiz and its partner. Just try it – you do not risk anything. But you risk missing out the good purchase price if you do not try.
