Why you should invest in gold in today’s economy

April 2, 2025

MoneyWatch: Managing Your Money

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Economic conditions have caused the price of gold to spike over the past 15 months, approximately.

Ireneusz Skorupa/Getty Images

Not only is it critical to know which investments to avoid and which to pursue, but it’s also equally important to know when to get started and when to hold off. This is most clearly seen when purchasing real estate, as many prefer to buy in when interest rates are low and housing prices are moderate, as they were at the start of the decade. If you buy in now, however, in April 2025, you’ll likely get stuck with an exponentially higher interest rate and much less affordable home prices.

A gold investment, while not as widely familiar as real estate, has a similar dynamic. Since it doesn’t operate in the same ways that stocks, bonds and real estate do, prospective investors will need to take a more strategic approach. But that doesn’t mean investing in the precious metal is equally as valuable in each economic climate. In recent years, however, it’s been a particularly smart way to hedge against inflation and diversify your portfolio. And, in the economic climate of April 2025, it makes particular sense to get invested in gold right now. Below, we’ll explain why.

Start protecting your money by investing in gold here now.

Why you should invest in gold in today’s economy

Here are three strong reasons why a gold investment in today’s economy should take precedence now:

Inflation is still prevalent

Yes, inflation declined in February. And, yes, it’s down to the 2% range from the 9% range it had hit in June 2022. But inflation is still increasing, it’s just doing so at a slower pace than it was three years ago. Now at 2.8%, the inflation rate is almost a full percentage point higher than the Federal Reserve’s target of 2%. And it’s been sticky enough to halt the interest rate cut campaign the Fed started in the final months of 2024 (they paused rate cuts when they met in January and March 2025). 

Against this backdrop, then, investors should consider investing in gold now to hedge against inflation. Perhaps its most well-known feature, gold can often help battle the adverse effects of inflation by maintaining and frequently even rising in price during such periods. And this has been clear over the past year, specifically, with the price of the metal surpassing numerous price records. So, with inflation still a prevalent concern and the prospects of immediate relief unclear, many investors would be well-served by adding a portion of gold to their portfolio as protection now.

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Stock market uncertainty is hurting your portfolio

Stock market uncertainty has been prevalent in recent weeks. Take a look at your portfolio and investments and compare them to what they were on February 1. If you don’t like what you see then consider investing in gold to help diversify your asset portfolio, thanks to that aforementioned rising value. Gold, unlike many other assets, has been particularly strong both this year and throughout 2024, making it a valuable asset to invest in as others falter. 

That said, a gold investment should generally be capped at 10% of your overall portfolio and maybe even below that, depending on your specific investor profile. So be sure to invest, yes, but investing in the right amount is equally as important to avoid crowding out other income-producing assets like bonds and stocks.

The price is consistently rising

The price of gold per ounce in January 2024 was just $2,063.73. In April 2025, however, it’s been listed at over $3,100 for the same amount. That’s just over a 50% jump in around 15 months. So if you’re looking to invest in an asset that’s been consistently on an upward trajectory, gold is the one to invest in now. Expectations are that the gold price will rise even further, possibly even past new price records in April and May. So it makes sense to buy in now before the price becomes prohibitive. 

That said, prospective investors don’t need to pay that top price to get started, as fractional gold or other gold types can allow investors to buy in (and secure the protection gold affords) at a reasonable entry price point. Waiting to act, however, won’t be beneficial, considering that the gold price over time only typically increases. 

The bottom line

A gold investment may not make sense in every economic landscape, as the timing and supporting reasons need to make sense. However, the economic landscape of April 2025 is a unique one, making gold a clearly advantageous investment. Thanks to an ongoing fight against inflation, (which gold can hedge against), stock market uncertainty hurting your portfolio (which gold can diversify) and a consistently rising price that all investors can benefit from, now is a smart time to consider the yellow, precious metal. So speak to a financial advisor or gold lender who can answer your questions and, potentially, get you started with a gold investment now.

Learn more about your current gold investing options here.

 

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