No, I didn’t buy gold, and I didn’t buy a hot penny stock that shot up 233% in the last few months. I invested in an experience that I expect will pay dividends for years to come. It’s long been said that money can’t buy happiness, but as some recent studies have found - it depends on how you spend it!
A recent study from the Journal of Consumer Psychology found, investing in experiences is more rewarding than buying “things.” That study was mainly focused on people who spent money on activities or experiences, like going out to dinner or a movie, and those who spent money on materialistic consumption like phones, cameras or clothes. But the same holds true for stocks (To a point). I mean, investing in an appreciating asset is certainly better than sinking your money into the latest consumer electronic gadget or the new fashion of clothing, but it’s still ultimately materialistic and may not making you as happy as you think.
People invest in assets (stocks, bonds, gold, etc..) to make money. They ultimately want their money to grow, but to what end? To be happy? To be secure?
Security is important, but it does not bring happiness alone. Likewise with simply expanding your portfolio. True happiness it seems is based on what you do with that money, rather than how much of it you have. And so it is that I proclaim my best investment of 2010 to be the Christmas tree hunt with my family.
Some of my best childhood memories are from Christmas time with my family. I had a pretty normal childhood, - some ups and some downs but nothing too extreme. And nestled in the middle of those ups and downs are many happy memories of Christmas. Not just the gift getting, but the feeling of family, companionship and love.
Now as a father, I’m enjoying holiday traditions from the other angle. I’m not only building those memories for my children but for me as well, though this time around I’m the parent and not the child. My wife and I are now in our 6th year of parenting and the holiday magic has grown with each successive year.
Sure things don’t always go right. Two years ago, our truck got stuck in the mud at the Christmas tree farm and it took over an hour and much help from good Samaritans to get free. The year before that we brought our tree home only to find that the bottom branches that needed to be trimmed to fit in the stand left the bottom 3rd of the tree bare. It looked ridiculous and top-heavy. But we still talk about those years and while they were miserable experiences at the time, they brought us closer together and we can laugh about it now.
In short, doing things makes us happier than buying things.
People who spend money on experiences have less feelings of inferior social comparison - meaning that people who buy the latest “thing” may feel good until they see someone else has a newer, faster or better “thing” than they do. Experiences are personal, and so they aren’t as easy to compare and less likely to feel failed in comparison.
Thursday, December 2, 2010
Rosland Capital, Gold Coins, IRAs and ETFs. Oh My!
I keep hearing radio commercials and seeing television commercials for Rosland Capital Gold investments...
Gold coins!
Gold in your IRA!
Gold dust to sprinkle on your krusty-o's for breakfast!
Ok, I made that last one up. But it seems like gold is the new .com or the new mortgage backed security or maybe it's here to stay. No one can answer that question for sure, and anyone who says they can is selling something, but here are some things to think about concerning gold as an investment.
Gold in your IRA.
The Tax Payer Relief Act of 1997 made it possible to add precious metals (like gold) to your IRA account. It's a great idea - in moderation. I mean, diversification is a good thing but anyone putting a majority of their portfolio in gold is insane (in my opinion). Gold typically goes in the opposite direction of stocks, but these days are anything but typical and any more than 5-10% of your portfolio is far too risky.
ETF, bullion or coins?
Anyone can invest in a gold ETF in a standard IRA. You can invest in an ETF that tracks the price of gold, like the SPDR Gold Shares (GLD), or an ETF that holds mining stocks, like Market Vectors Gold Miners ETF (GDX). But not all IRA accounts offer the option to hold Gold bullion and coins, although I suspect many more do now than 10 years ago. This is where companies like Rosland Capital have traditionally found their niche.
Many brokers didn't bother much with precious metals a decade ago since their wasn't as much demand compared with stocks and there are extra regulatory considerations when offering gold in IRAs. For instance, gold coins must be at least 99.5% pure gold to be approved by the IRS for use in IRAs. They also have to be branded as legal tender. The only gold coins that currently qualify for IRAs are the Canadian Gold Maple Leaf , the Perth Mint Lunar series and Kangaroo-Nuggets from Australia, the Austrian Philharmonics and of course the American Gold Eagle featured so prominently in that Rosland Capital commercial.
Whether you invest in mining company stock or bullion or coins, there is risk involved. It's just different for each kind.
For instance, investing in mining company stock carries the same risk as investing in any stock. Gold coins and bullion carry the risk that the value of gold will decline below the investor's purchase price, but unlike a company stock gold will never become entirely worthless.
Another factor to consider when investing in gold is fees, as FMF points out. To be fair, he's talking more about liquidating your physical gold stash than your IRA holdings, but unloading the metal may be more difficult than unloading a stock if things turn around and there are more sellers than buyers.
Everyone has an opinion on investing in gold. Leave yours in the comments. :)
Gold coins!
Gold in your IRA!
Gold dust to sprinkle on your krusty-o's for breakfast!
![]() |
I love goooold! |
Gold in your IRA.
The Tax Payer Relief Act of 1997 made it possible to add precious metals (like gold) to your IRA account. It's a great idea - in moderation. I mean, diversification is a good thing but anyone putting a majority of their portfolio in gold is insane (in my opinion). Gold typically goes in the opposite direction of stocks, but these days are anything but typical and any more than 5-10% of your portfolio is far too risky.
ETF, bullion or coins?
Anyone can invest in a gold ETF in a standard IRA. You can invest in an ETF that tracks the price of gold, like the SPDR Gold Shares (GLD), or an ETF that holds mining stocks, like Market Vectors Gold Miners ETF (GDX). But not all IRA accounts offer the option to hold Gold bullion and coins, although I suspect many more do now than 10 years ago. This is where companies like Rosland Capital have traditionally found their niche.
Many brokers didn't bother much with precious metals a decade ago since their wasn't as much demand compared with stocks and there are extra regulatory considerations when offering gold in IRAs. For instance, gold coins must be at least 99.5% pure gold to be approved by the IRS for use in IRAs. They also have to be branded as legal tender. The only gold coins that currently qualify for IRAs are the Canadian Gold Maple Leaf , the Perth Mint Lunar series and Kangaroo-Nuggets from Australia, the Austrian Philharmonics and of course the American Gold Eagle featured so prominently in that Rosland Capital commercial.
Whether you invest in mining company stock or bullion or coins, there is risk involved. It's just different for each kind.
![]() |
The price of gold per ounce, 1973-2010 |
Another factor to consider when investing in gold is fees, as FMF points out. To be fair, he's talking more about liquidating your physical gold stash than your IRA holdings, but unloading the metal may be more difficult than unloading a stock if things turn around and there are more sellers than buyers.
Everyone has an opinion on investing in gold. Leave yours in the comments. :)
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