Cameron Zabko, CFP®
Sometimes, the doomsdayers and talking heads on TV can make you feel like the entire financial landscape is shifting beneath your feet. You might find yourself asking whether traditional investments still make sense—or whether something like gold, a widely known “safe-haven” asset, could be the right move. At Westhollow Wealth Management, we understand that these questions often come when you’re juggling both emotional and financial challenges, including huge worries like potentially outliving your money. While gold has a reputation for stability during uncertainty, the truth is more nuanced. Below, we’ll explore whether gold really meets its “safe haven” promise, how it responds to inflation or a market decline, and what you should consider before making it a centerpiece of your portfolio.
Gold holds a unique place in the public imagination. You’ll often hear it described as a hedge—something to help cushion your portfolio if markets turn south or inflation flares up. Over the past few years, this narrative has only intensified. Ever since gold soared above $3,000/oz in 2025, more and more families have wondered if they’re missing out by not holding at least some precious metals. Questions like “What if there’s another recession?” or “Will gold protect me from a potential stock market depression?” have become more common, especially among those facing major life changes.
As fiduciaries, our goal is to demystify gold’s role in a diversified investment strategy in an unbiased way. We’ll look at its historical performance, share the common ways of investing, and discuss risks that might otherwise get buried beneath the shiny allure of gold coins or bars. By the end, you’ll have a clearer sense of whether gold should figure into your long-term plans—or if your hard-earned money might be better placed elsewhere.
Plenty of investors think gold always thrives in times of market decline, but the data is more nuanced. Gold has indeed shown a tendency to climb when economic or geopolitical events trigger widespread fear. We can see this dynamic at play more recently: in 2025, gold climbed above $3,500/oz, far surpassing its price a few years prior. Major financial institutions, including Goldman Sachs and JP Morgan, project that it could continue rising—potentially even approaching $4,000/oz if various uncertainties persist. This positive outlook is fueled by several factors, such as inflation worries, wars, central bank buying, and de-dollarization trends.
However, if you zoom out to take in the last several decades of data, gold hasn’t always outperformed traditional equities over the long haul. Consider that the S&P 500 historically generates average annual returns around 7% (after inflation) over many decades, driven by corporate earnings, dividends, and continuous innovation. Gold, on the other hand, depends primarily on price change—there are no dividends or interest payments. It can experience spectacular spikes, but it can also sputter when the broader market is soaring. In short, gold tends to stand out during tough economic periods, yet it may lag during long stock market expansions.
When most people picture “investing in gold,” they think of physical bullion—tangible bars or gleaming coins you can stash in a safe... the fun stuff. But physical gold is just one avenue. If you’re considering adding gold, you’ll want to know the variety of options and the fees or logistics involved with each.
Physical Gold can mean minted bullion coins (like American Eagles) or “junk” gold (older coins or jewlery that still contain high gold content). Keep in mind that physical coins often come with a premium above the spot price, and it’s not unusual to see markups of several percentage points depending on rarity and mint. Storing gold securely brings extra costs, such as a safety deposit box at your bank or specialized vaulting arrangements that add storage and insurance fees. If you want the sentimental or tangible aspect of holding gold, these costs might be worthwhile, but think carefully about their effect on potential returns.
Gold Stocks and ETFs are popular for their liquidity. Stocks in gold mining companies or exchange-traded funds that invest in producers or processors of gold provide exposure to gold’s price movements without having to manage storage. Liquidity is typically high, so you can buy or sell quickly during market hours. ETFs often have an expense ratio that comes out of your returns, and many of them are still taxed as a “collectible” for U.S. investors, which means a higher capital gains rate than most stocks.
Gold IRAs promise a convenient way to keep physical gold while potentially accessing tax advantages (Traditional or Roth-style). However, setup, storage, and maintenance fees for these accounts can be steep, and the rules can feel more complex than standard IRAs. For anyone weighing a Gold IRA, be sure you fully understand the cost structure, including one-time setup fees and annual storage or insurance fees. It’s one thing to buy a gold ETF in a regular IRA, but quite another to buy physical coins through a specialized Gold IRA provider. Make sure you understand the total fee you will be paying and how much gold will need to appreciate before your investment returns to par.
Other Precious Metals—like silver, platinum, or palladium—sometimes come up in the same conversation as gold. They can diversify even further within the “precious metals” category, but their markets are often more volatile and can be influenced by industrial trends. If your intent is to hedge against a major market meltdown or sustained inflation, gold has historically been easier to track and analyze than many of these alternatives.
A surge in gold’s price doesn’t always translate to straightforward profits for every investor, partly because gold can come with a complex web of fees. As noted, Gold IRAs sometimes charge hefty premiums—these fees can significantly reduce an investor's principal. Physical gold can also quickly become expensive to maintain. And even if gold has rocketed to record highs the past couple of years, there is no guarantee that it will continue on that trajectory.
There can also be a mismatch between expectation and reality. Yes, gold is seen as a hedge against inflation or a strong safe haven during a market decline, but its short-term correlation to either factor can be unpredictable. Over the span of many years, gold can hold purchasing power fairly well, but timing can matter. Jumping in right after a massive price spike could be risky if gold later encounters a multi-year slump.
Finally, remember that gold does not produce income. Where a stock or bond can deliver dividends or interest, gold profits rely entirely on its price going up. If you’re envisioning a comfortable retirement lifestyle, you may need a larger plan for generating consistent income—especially if you worry about outliving your resources.
So how much gold, if any, belongs in a retirement-focused portfolio? There is no universal prescription. Some analysts argue for 5–10% gold exposure, while certain research suggests going as high as 10–15% in periods of elevated market risk. At Westhollow Wealth Management, we generally advise caution, particularly if you’re trying to piece together a reliable paycheck replacement.
Gold may help stabilize a portion of your portfolio during a market depression or severe downturn, but it’s not the sole path to security. Carefully navigating Social Security timing, balancing your investment mix, and ensuring you don’t pay more taxes than necessary can often provide a more consistent foundation. To learn how we approach that broader picture, explore our comprehensive planning process.
As with any asset class, gold works best when it’s thoughtfully integrated into a broader strategy—paired with diversified equities, fixed income, and other holdings. The idea is that gold’s performance might offset losses elsewhere if the stock market slumps, but it shouldn’t dominate your portfolio if you still need the kind of longer-term growth that stocks and bonds can provide.
If you decide to buy gold, here are a few pointers that can help protect your financial wellbeing:
Watch Out for Markups: When you purchase physical coins or bars, compare the dealer’s premium to the spot price of gold. The narrower the difference, the more closely your purchase aligns with gold’s actual market value.
Store It Securely: Whether you choose a safe deposit box, home safe, or professional vault service, confirm that your insurance coverage is adequate. A locked closet may deter casual theft, but it won’t help if there’s a burglary or natural disaster.
Stay Mindful of Liquidity: Physical gold can be liquidated, but you’ll need to find a buyer who offers a fair price. That’s easier with well-known coins and bars than with "junk" gold.
Include Fees in Your Calculations: If you’re purchasing gold ETFs or considering a Gold IRA, examine expense ratios, storage fees, and any administrative costs.
Verify Authenticity: If you’re buying physical gold, especially online, insist on reputable dealers. Counterfeits do exist, and the cost and headache of verifying authenticity could become another task you don't want to deal with.
Gold has long captivated the human imagination for its perceived security and luster. There’s good reason for its status as a hedge against certain forms of risk: gold’s track record in times of inflation or serious market setbacks is hard to dismiss. Yet, it’s not a panacea; it offers no dividends or interest, and the complexities of storage, tax, and timing can dampen enthusiasm. If you’re in a position where life has forced sudden changes—like transitioning from a corporate career to managing an estate—adding gold might help preserve some peace of mind, but it’s just one tool. The real question is how it fits within an overall strategy designed for stability, growth, and the lifestyle you deserve after decades of work.
Before you commit, make sure you’re not driven solely by fear or hype. It’s easy to see headlines about record-breaking gold prices and assume it’s a must-have asset. Take a step back, review your broader financial plan, and weigh gold’s risks alongside its potential rewards. If you’d like help navigating these decisions—whether it’s incorporating gold or simply clarifying how to replace a paycheck in retirement—consider scheduling an introductory call with us. We’re here to provide straightforward, empathetic guidance to help you find clarity in your next financial chapter.
Is gold a sure thing in times of crisis?
No investment is truly “sure,” including gold. Historically, gold tends to rise during recessions and periods of market stress. However, its exact price movements depend on various factors, like global demand and interest rates. In the short run, gold can be volatile, so it’s wise to see it as part of a broader strategy rather than a guaranteed shield.
Are gold IRAs worth the fees?
Gold IRAs offer tax advantages, particularly if they’re structured as Traditional or Roth accounts. Still, the setup can carry higher fees than a standard IRA—storage, insurance, and administrative charges can erode returns. Always read the fine print and consider whether simpler vehicles, like gold ETFs in a traditional brokerage IRA, might be more cost-effective.
How much should I invest in gold if I’m nearing retirement?
Most experts recommend keeping gold to around 5–10% of a diversified portfolio for those nearing retirement, though some advocate a range as high as 10–15% in uncertain markets. Your specific allocation depends on factors like your total wealth, risk tolerance, and need for liquidity. Since gold doesn’t generate ongoing income, balance it with assets that can reliably pay your bills.
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