Why is Gold a Trusted Investment Savings?
Long ago, before humans recognized paper money as a medium of exchange, humans used precious metals as their standard of exchange. This has been done since the time of the Roman empire until the time of the Ottoman Empire.
Precious metals such as gold have a standard value and do not change. You can see the price of goats at the time of the prophet Muhammad in the 7th century, the price of a goat was valued at 1 dinar or the equivalent of 4.25 grams of gold.
For information, the price of 1 gram of gold on March 18 2024 is IDR 1,150,000. So 4.25 grams of gold is IDR 4,887,500. With almost 5 million rupiahs, of course, you can buy a strong and big male goat.
You can also understand changes in gold prices from the graph below:
From the picture above you can see that the price of gold per kilogram against the US dollar in 1996 was IDR 12,500 US Dollars.
In 2012 the price of gold approached 58,000 US Dollars per kilogram and in 2024 the price of gold reached 70,000 US Dollars per kilogram.
So it can be understood that in just 20 years the percentage increase in gold prices reached 425.12%. As seen in the table below:
If we talk about it in rupiah values, for example, someone had IDR 7,000 in 1970, in that year he could buy a goat at a good price, but in 2024 with IDR 7,000 he certainly couldn’t buy a good goat. IDR 7,000 for buying goat satay in 2024 will not be enough.
When he saved this Rp. 7,000 in gold in 1970, at that time the price of gold was 500 rupiah per gram, so he got 14 grams of pure gold. He kept the gold in a trusted gold depository. so that in 2024 with 14 pure grams he can buy around 3 goats. As an illustration, the rupiah exchange rate in 1970 against 1 US dollar was IDR 250.
What are the benefits of saving gold?
After looking at the picture and the continuous fluctuations in gold prices which tend to increase from year to year, here are 3 benefits of saving gold :
1) Gold as a protector of wealth
Gold can be a protector of your wealth or money when there is an economic crisis, when currency values fall and fall, causing an economic downturn, the value of gold continues to increase so that gold can be your financial savior when you are in trouble.
2) Investment capital that is affordable and easy to do
Currently, you can save gold starting from IDR 50,000 to millions of rupiah. You can cash it in grams of 1 gram, 5 grams, or 10 grams. To make an affordable and easy gold investment, we recommend that you buy batik gold through state-owned enterprises, like Pegadaian or Antam.
3) Values continue to rise over the long term
As you can see above, the value of gold always increases from year to year so it can help your finances, if you have long-term goals such as building a house, paying for your children’s college tuition, or for travel such as going on the Hajj or traveling around Europe in the next 10 years.
