Investing in Gold: 10 Facts You Need to Know

Gold tends to do well in times of trouble.

Small gold nuggets in an antique measuring
(Image credit: Getty Images)

Gold tends to do well in times of trouble. Well, thanks to the coronavirus pandemic putting the global economy on lockdown, investors had trouble in spades in 2020, and that was evident in a nearly 25% return for the yellow metal last year.

However, gold prices have had a more difficult time in 2021, off about 8% year-to-date. But despite what should be a much better year for the economy than last, some investors still might be tempted to buy gold on this dip. After all, even after coming under pressure from higher interest rates and outflows from gold exchange-traded funds (ETFs), analysts think the outlook for the shiny metal remains bright this year.

Indeed, 38 analysts surveyed by the London Bullion Market Association forecast gold prices to average $1,974 an ounce in 2021. That's about 13% higher than current prices, and would represent a return to levels not seen since August 2020.

Just understand: Pouring a chunk of your assets into gold isn't always a good idea. In fact, gold actually has a spotty long-term record as an investment.

Here are some critical nuggets you should know about investing in gold before betting on the precious metal.

Data, prices and returns are courtesy of Kitco, DQYDJ, the Perth Mint, the World Gold Council, YCharts, the U.S. Mint and Morningstar.

Dan Burrows
Senior Investing Writer, Kiplinger.com

Dan Burrows is Kiplinger's senior investing writer, having joined the august publication full time in 2016.


A long-time financial journalist, Dan is a veteran of SmartMoney, MarketWatch, CBS MoneyWatch, InvestorPlace and DailyFinance. He has written for The Wall Street Journal, Bloomberg, Consumer Reports, Senior Executive and Boston magazine, and his stories have appeared in the New York Daily News, the San Jose Mercury News and Investor's Business Daily, among other publications. As a senior writer at AOL's DailyFinance, Dan reported market news from the floor of the New York Stock Exchange and hosted a weekly video segment on equities.


Once upon a time – before his days as a financial reporter and assistant financial editor at legendary fashion trade paper Women's Wear Daily – Dan worked for Spy magazine, scribbled away at Time Inc. and contributed to Maxim magazine back when lad mags were a thing. He's also written for Esquire magazine's Dubious Achievements Awards.


In his current role at Kiplinger, Dan writes about equities, fixed income, currencies, commodities, funds, macroeconomics and more.


Dan holds a bachelor's degree from Oberlin College and a master's degree from Columbia University.


Disclosure: Dan does not trade stocks or other securities. Rather, he dollar-cost averages into cheap funds and index funds and holds them forever in tax-advantaged accounts.