Over the last several months, I traveled throughout the country to assist advisors and speak at their gold and silver workshops. These workshops had great success, bringing in large numbers of clients who were intrigued by the idea of “wealth insurance,” and wanted to understand the role of physical gold and silver in their portfolios. Many of these clients understood the importance of hard assets as a diversifying hedge but didn’t know the right amount of gold and silver to purchase, or even when, where or how to go about purchasing them in the first place.
For those of you who do not own physical metal or do not promote gold and silver in your “safe” or “growth” buckets, you may want to consider whether your clients are looking for the same thing as the hundreds who attended these workshops. Regardless of whether you are annuity licensed only or if you are an RIA/IAR, your clients need to know that you have access to this resource. If clients are unaware that you have access to physical gold and silver, they may begin looking elsewhere, which, as I have discussed in previous articles, could prove detrimental to them both legally and financially.
But before I get too far ahead of myself, let me start with my favorite question from advisors and clients alike: “Why gold and silver?”
Gold and silver is money, and virtually always has been. When the idea of trading currency for goods came into our primitive societies, gold and silver were there, established as a global currency. Somehow Americans have forgotten this with today’s currency. They have put faith in our dollar, which for the past 47 years, has been fiat – backed by nothing.
I think we need to start asking ourselves, “what gives our dollar a perceived value?” Over the last 5,000 years, history has shown us that the average fiat currency lasts only 39 years. Now, I am not saying our dollar is going away, but I am saying the odds are stacking up against us. With the petro-yuan launching successfully in March 2018, the Shanghai Exchange now allows countries to trade oil for yuan, gold and silver, providing a more global-friendly alternative to the petrodollar and thus further destabilizing our dollar and our debt. The petrodollar trade of the 1970s is one of the major things that has enabled the U.S. to be stable with $21 trillion in debt because countries were forced to buy our bonds and debt in exchange for oil. That is no longer the case.
Gold and silver is wealth insurance.You cannot turn on the TV or the radio without hearing gold and silver commercials, and you can be certain that your clients hear the same targeted messaging. But the difference is, you know how to purchase gold and silver responsibly and strategically. Do your clients? Are they informed enough to understand that these ads are just schemes and scams?
As one of the only licensed, regulated and bonded wholesalers out there, we take fiduciary responsibility seriously and strive to educate clients and prepare their portfolios to withstand an uncertain market. If positioned correctly, clients (and yourself) can achieve what we call “wealth insurance.”
We have a general rule of thumb that 10% of all assets need to be placed into gold and silver. That 10% “insures” and protects the other 90%, which is still deployed in typical asset buckets such as stocks, bonds, CDs, annuities, insurance, REITS and cash.
Our clients who were positioned correctly into our models did not lose a penny during the last 2008 recession – they merely observed a wealth transfer within their portfolios. This is because the concept of wealth and value never disappears. Wealth merely transfers from one asset class to another. During the last recession, 10% in gold and silver rose 489% to help offset the other dollar-based asset losses. When our dollar and equity markets experience losses, gold and silver tend to increase and play a pivotal inverse relationship.
The rest of the gold and silver process comes down to the logistical questions. Where do I store it? Which is better, gold or silver? Can I do both qualified and non-qualified? How is it shipped? Whether it’s a complex question or a basic one, we are here to answer anything. Precious metals are only as complicated as we try to make them.
The old adage from Business 101 still applies – “KISS – Keep It Simple, Stupid.” Let myself and my company keep this simple for you. We help you with education, marketing materials, workshops, webinars, client/advisor conference calls and more.
Reach out to us today to discuss how to begin positioning your clients (or yourself) in precious metals.