Conservative investor - just want to keep home deposit safe

Hi
I'm new here, and just want a bit of advice please. Whilst I am excited by the thought of buying some precious metals, I'm really a 'money in the bank' kind of person.

However I'm getting the jitters, and want to keep the deposit I've saved up for a home safe while things are so uncertain. So I'm thinking say $15K in gold, $15K in silver, and the balance in cash (banked :-?)

I'm REALLY dithering about how to do this. I'm in Sydney. Perth Mint certificate? Buy Perth Mint from Jaggards, or ABC physical gold and silver bars and keep in Custodian safe? With physical gold/silver bullion, how do I do this? Do I physically buy it then walk across town personally to take it to Custodian for example? Should I buy pool? What happens to precious metals in vaults if there's civil unrest? What happens if there is a sophisticated vault heist? Should I buy Swiss gold??! (yes I do watch too many movies)

any tips welcome, thank you

 

I'd continue being a 'money in the bank' kinda guy only buy PM's if you can afford to lose some of those $'s.

But if you really want to take the chance, compare prices at Perthbullion/Goldstackers and ABC. Even factoring in postage the first two can sometimes be cheaper than local dealers like Jaggards.

Buy low premium generic like Perth Mint or ABC. Swiss gold is fine but you do pay a premium and therefore buy a little less. You can just walk across into Custodian and deposit it but would recommend opening an account first and then buying the PM's.

 

If you buy at ABC and have a Custodian vault, they'll deliver it to the vault and meet you inside to sign for it to ensure you have no issues.

 

1. How long until you expect to use the deposit?

2. Do you have an online share trading account?

If the answers are, 1. more than 12 months and 2. yes, you might consider a gold or precious metals ETF (Exchange Traded Fund). ASX code GOLD and ETPMAG.

These are liquid investments, low transaction costs and no storage problems.

Only risk is counterparty risk if your SHTF (S*** Hit The Fan) scenario includes ASX and financial system breakdown.

 

Double post

 

Hi Thanks for your prompt replies, it's great to see this is a 'live' and active forum .

I was edging towards a PM Certificate, however now it seems like the Certificate is not as secure with risks of counterfeiting and therefore it would take a longer time to liquidate.

Thanks for the links BB, I enjoyed the inventive 'how to hide things link'.

Yes BuggedOut, House, and Silverpete, I am wary of a 'SHTF' kind of event at the moment.

So can I rephrase it... if the S*** really DOES hit the fan, what's the best position to be in, precious-metal wise?

thank you

 

In the most severe SHTF scenario you want physical gold and silver, low premium bars in your possession. Bury them deep in your backyard or under your house, buy a gun and don't tell anyone.

Sounds extreme but if your scenario is extreme then that what the hardcore preppers would suggest. Along with a supply of cash, food and water of course

Personally I think that's a bit too extreme, but each to their own....

 

Kilo pm silver bars. Job jobbed.

 

ha ha, well I really hope there's no need for that. My 'worst case scenario' is something a little gentler. Still, I want to have a backup that's out of the banking structure, and also not holding it where I live.

so perhaps physical gold and silver in the Guardian Vault? I'll have to weigh up the $257 pa vault hire costs against the value of the $30K left in the bank. I take it that vault/ storage fees aren't tax deductible, as the physical gold/silver isn't taxed.

On that subject, I also take it that physical gold/silver will not be taxed whereas any unallocated gold/silver holdings would be taxed when it came time to 'liquidate' them back into cash?

I know all of this may seem standard stuff to you, however as someone who has believed in the safety of banks, it feels really strange to be thinking along the lines of finding somewhere else as secure and accountable as a bank ...... vaults aren't really legislated and regulated.....

 

Thats cheap.. Reserve vault in bris costs me a fair bit more than that per year.

 

this is their smallest vault - enough for quite a few kgs of bullion etc (enough for me)

 

Buy a bush block for the coin you have.

 

I would advice you keep the money in the bank, keep some in short term term deposits. Most banks will allow term deposits in major banks as collateral for a mortgage.

You are saving to buy a house, therefore you don't think their will be shtf any time soon, which I agree. A decent size recession is not shtf.

I'd bet that they will be a medium to big recession "that matter" sometime 5 to 10 years in Australia, might not be the next one, becuase of debt (Australian debt nothing to do with the rest of the world).

What do I mean by a recession that matter 10 to 15% unemployment rate. People lose jobs and have to have a firesale not just of toys like sports cars and boats like the last one but homes being repossed, which is when I'll buy back in to housing.

Another sobering though, If nothing really happens in pm world and it holds true that gold and silver are store of value than it's giving you inflation rate of return.

Also consider gold and silver can go down in price, putting you in a personal shtf. (People have bought at $1800 gold and $40 silver.)

 

^^ +1

PMs are way more volatile and higher-risk than money in the bank. Put your house deposit into silver and yes it could double in value but it could also halve.

As Ipv6 said, if you're buying a house you're banking on the system holding up for some time to come, so why hit the panic button when you're so close to taking the next step?

But if you really want to buy some gold and silver, no-one here is going to object Maybe start by buying a little bit and see how it feels.

Most people advocate only having a minority percentage of your wealth in PMs in any case. 10-20% would be a good starting point.

edit: sorry, obviously this is not SHTF-relevant, just general house-deposit stuff

 

Planning to put down a house deposit with a mortgage is buying into the system.

Look at the rest of the world and see how the system is going. The powers that be will do everything necessary to keep the system going - look at Greece, Japan, Argentina - so 'system' solutions are what you need.

Even if there is a grim bail-in, you'll still be holding your money in the bank, you just won't have access to it, BUT if you're bank holds your debt, they'll keep deducting the mortgage payments.

I believe in hoping for the best, and preparing for the worst. So hoping for the best, is buying into the system with your house and mortgage. Purchased wisely and paid down carefully it is the best thing you can do. You'll almost always need a place to live.

Preparing for the worst is renting something a walk away from your work, putting a cash buffer under your bed (say 3 months worth of expenses), making sure you have a week or more of food stored away, combing your bills and lifestyle choices so it's not easy to steal from you, and having 100 ounces of silver and 10 ounces of gold in easily split denominations carefully hidden away - and as above, shut up about it all.

Preparing for the best is leaving your cash in the home savings account at the bank you'll be getting your loan (or whatever best interest earner they have) and putting about 10% of your disposable income into collecting gold coins. They'll slowly mount up and one day could provide a windfall, or shelter on a rainy day.

It's very easy to find doom and gloom all over the internet, and a lot of it is very well argued, but look into history and see what the real potentials in Australia are. A Police State after currency collapse is an extremely low probability over your mortgage term.

edit to add: and all the above ideas are good if you want to buy some metal insurance for your future. If you want to play with gold to make money in the safest arena possible, then Perth Mint unallocated program is where I'd be looking.

 

IMHO if you are worried then put 5% of your cash into gold. This won't expose you to too much volitility but would save you in an extreme event. It's an insurance policy you can cash out whenever you want. Just buy some low premium bars and stash away.

 

Because you know you will be selling the metal in a few years, buying physical metal will be annoying when you go sell it, far easier and lower premium to simply buy allocated or unallocated metal. Plenty of places offer this, best is probably the Perth Mint.

Forget what anyone says, what theories they have etc, even the experts, no one has any real clue what metal prices will do in the future. It will be a gamble. You could lose maybe 10-20 %, you could gain 10-20%. Forget dreams about doubling your money.
Gold is safer and less volatile than silver IMO.

If I was you I'd simply stick it in cash.

 

Then you've fallen for the doomsayer hype that never happens. It's ridiculous.
Bank deposits are government guaranteed up to $250k. If the banks and governments fails and unable to repay, then all of society is screwed including you, because you'll likely lose your job and won't have an income.
If you really think this is plausible then you wouldn't be looking to buy a house, you'd a buy block of land, grow your own food and go off the grid.
Just stick your money in the bank, save up for your deposit, and stop hanging around doomsayer places like here

No, don't dick around with that. Just get a Perth Mint account if you want to buy metal. Unallocated will cost you nothing to store.

Nope. No tax. Either way you are subject to capital gains tax though.

Seriously, stop listening to the doomsayers.

 

SHTF is always a personal situation thing.
During the last GFC, if you kept your job and could continue to service your debts, and didn't have dodgy investments, then you were just fine. The GFC was nothing but a name.
Now people are saying the next one will be TWICE AS BAD! *insert horror music here*
Woopdy-do. As long as you keep your job and have serviceable debt (or no debt) then you'll be fine.

Now that you are looking to buy a property and go into big debt (presumably you have zero debt at present), the only thing you should be worried about is what happens if you lose your job.

 

If you have so much I would advice you to keep it under the radar.
For vaulting see guardian vaults in Sydney CBD Castlereagh St 151 I guess. Mention that you are from Silverstackers to get a free month. Keep your extra cash in the vault and everyday cash with you or atm. Just to avoid those tellers treating you like a criminal every time you withdraw more than usual amount. Yes your money but they still ask you why do you need it? Whats it for etc...

Silver wise Perth Mint kilo bars are the most recognized and your loss will be minimal when selling. Try to get them here from reputable seller for around $40 cheaper a bar vs dealer.

Gold is much easier to keep but much harder to sell unless you let it go for spot price. Even if you are keen try to get 1gr 5gr 10 pr 20grams at or near spot. If you buy it from a dealer and try to sell it here soon you ll lose money. If you are looking for a long term and trying to be safer go with a dealer.

Whatever you do don't keep your metal at home.

Goodluck