Dhanteras 2024: Make Smart Investment In Gold This Deepawali, Step-By-Step Guide

Dhanteras 2024: The festival of light, Diwali has kick started with Dhanteras on October 29. Traditionally, Diwali is one of the most auspicious days for buying gold in India. Being one of the top consumers of gold in the world, India observes a huge influx of demand for precious metals during this time of the year. It is traditionally considered the best time to invest in gold, as it is believed to bring prosperity and good fortune. With fluctuating gold rates and an ever-evolving market, buying these precious metals wisely is essential to making a sound investment. Checking for BIS hallmarking, knowing about making charges, and securing oneself by choosing authentic pieces are some of the good means through which you can give added value to your investments while ensuring security for generations to come.

So, before you plan your purchases, here are some essential tips to ensure you make wise investments ahead:

Choosing the Right Gold

The Karat System

Gold is available in various purities, such as 24K, 22K, 18K, and 14K, each serving different purposes. In its purest form, i.e., 24 karats, gold is highly malleable and ductile, making it ideal for crafting coins and bars. However, its softness makes it unsuitable for jewelry making. A more popular choice for jewelry is 22 karat gold, also known as 916 gold. It contains 91.6% pure gold and 8.4% other metals, primarily copper. This alloy offers a good balance between purity and durability, making it suitable for various jewelry designs. Another common option is 18-karat gold, which consists of 75% pure gold and 25% other metals. It is more affordable than 22-karat gold and is often used for everyday jewelry pieces.

Check for authenticity:

Ensure your gold purchase comes with a BIS hallmark certification, which is a set of standards laid by the Bureau of Indian Standards. This guarantees the purity of the gold. For added security, it is advisable to buy gold on Dhanteras from reputable jewelers who have a proven track record of quality and authenticity.

Scrutinize Making Charges and Total Weight

The price for jewelry with gemstones (like diamonds or emeralds) is sometimes based on total weight, which tends to drive the price of this piece higher. It is, thus, wise to seek a clear and proper breakdown of gold and gemstone weight separately, ensuring you only pay the gold rate for the gold part. That would bring about some transparency, which helps with resale in addition to minimizing excessive cost.

Consider resale value if gold is an investment.

For buyers who are focused purely on investment, gold bars offer great purity without additional charges for designs. Bars come in different size ranges, which help you invest according to your budget. They're easier to store, simpler to liquidate, and an ideal choice for those seeking to preserve wealth. Those planning to buy jewelry can look for jewelers who are offering a buyback guarantee. It is important to note that making charges doesn't contribute to resale value, so opt for simple, timeless designs, which are easier to resell and typically provide a better price.

Investing In Intangible gold

Gold investment in recent times has become more accessible than ever. Beyond traditional physical gold, a variety of non-physical gold investment options are now available, which are equally useful to safeguard your wealth and diversify your portfolio.

Gold-backed ETFs:

Gold Exchange Traded Funds (Gold ETFs) are a type of investment fund that tracks the price of gold. Instead of buying physical gold, you buy units of a Gold ETF, which represents a certain amount of gold. These units are traded on stock exchanges just like regular stocks. The price of the ETF is directly linked to the price of gold and fluctuates accordingly.

Gold Bonds:

Issued by the Government of India, specifically through the Reserve Bank of India (RBI), the sovereign gold bonds (SGBs) are the government-backed securities that offer a safe and convenient way to invest in gold. SGBs are denominated in grams of gold, with a minimum investment of 1 gram and a maximum limit of 4 kilograms for individuals. SGBs are a favored option for those looking to invest in gold for long-term gains while avoiding the drawbacks associated with physical gold.

Digital Gold:

Digital gold is a recent offering in India where investors can buy, sell, or accumulate gold digitally through platforms like Paytm, PhonePe, and other fintech platforms. The gold bought is backed by 24K physical gold stored in insured vaults. Since this is done on paper, there is no worry about theft or storage.