The Golden Years, or if you prefer, Gold For The Old

from What Is Your Exposure? by David Morgan

Let me be clear: I don’t sell bullion but do advocate that everyone buy coins (buy silver) and bars of both gold (buying gold) and silver. I think that’s your best savior in this kind of an environment.

Often the question arises, what percentage of someone’s assets do you recommend in the precious metals sector? Let us understand that we’re talking in a very generic sense here without any kind of suitability or special circumstances or things like that. But what range or percentage is recommended that people allocate through real money?

In The Ten Rules of Silver Investing, I was asked that question. At that time I said 10 percent; however, after that was published, my inclination was to move it up to 20 percent, because the financial system was becoming much more unstable.

The best investment you could ever make is in yourself. If you have a going business, put money in your business, make it stronger, make it better, and market it better, whatever. Or get an education for yourself so you can get a better job or a promotion and so forth. Having said that, you do need some exposure to the metals, and 10 percent as a minimum is a good place to start.

The next question of course is how much gold or silver? This is subject to the individual. The older you are, the less time you have to recover from a mistake. Thus, the older you are, the more gold you should have—so you should probably favor the gold market. The younger or more aggressive you are and the more risk you can take, the more you might consider the silver market. Then there are those who watch the market carefully (such as I do) and trade the gold/silver ratio when it seems favorable. If this is done properly, an investor can actually end up with more metal, with very little effort.

You could look at it this way: if you’re 50 years old, you’re 50 percent gold, 50 percent silver; if you’re 60 years old, you’re 60 percent gold, 40 percent silver, that type of thing. Several people I know who are in their fifties, sixties, and seventies believe silver will outperform gold, but it’s a rougher ride.