Gold Accounts vs Physical Gold

Gold Accounts vs Physical Gold

It's no secret that there have been significant fluctuations in gold prices over the years, often leaving investors uncertain about their investments. For instance, during the financial crisis of 2008, the stock market crashed, and millions lost their fortune.

As such, people started to think about securing their assets from economic downturns and opted for a safe investment like gold.

Gold is a go-to investment for many people, but what's the best way to store it for maximum value? Physical gold or a gold account? Do you want quick access, or would you prefer long-term security? Are you looking for convenience or control of your investments?

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Factors To Consider When Deciding Between A Gold Account and Physical Gold

Return on Investment

Gold Accounts vs Physical Gold

It's important to look at market trends and conditions to determine the lucrative investment opportunities available to you. Different investors have different goals; some might be interested in building their gold wealth, while others aim to increase their profit margins quickly.


Choosing a convenient gold investment option can help save you time and energy so you can enjoy the rewards of your investment sooner rather than later.

Think about the time and hassle you will have to put into your investment and how easily it can be accessed. You might consider the location of the gold investment, how to get and transport it, and if you require any assistance from a third-party service provider.

Look for the investment with logistical services that offers prompt and convenient access. In addition, try to find fairly easy investments to transfer or trade, which will allow you to move money around if needed quickly.

Associated Costs

Depending on the size of your investment and the method that you choose to buy gold, many different types of costs can add up quickly over time. Look for cost-effective investments that guarantee a competitive edge against competitors.

These can significantly impact your returns, so considering these costs before undertaking a gold investment is essential to having a successful outcome.

Factor in broker commissions, dealing costs, and storage fees. These can range from a few percent to almost double-digit levels, so make sure you know what you're getting into before locking in your gold investment.

Make sure to consider other factors, such as the level of insurance coverage and any government regulations that may apply. These are especially if you want to venture into the international market.


Liquidity can tell you how easy it is to convert your gold into cash, and it varies based on the type of gold you own. If you are in a financial pinch and need access to liquidity quickly, certain investments will provide more options than others.

Some investments require long lead times and go-betweens for transactions to be completed. This may lead to delays and may not be an ideal investment for those who need quick access to their funds.

In contrast, other investments might offer more flexibility, allowing you to convert your gold into money in a much shorter window, and are ideal for those who need quick and prompt access to cash.


This should always be a priority when investing in gold. Though the prices may vary from ounce to ounce, and it can be hard to track the actual value of your gold investments, security is something you have more control over.

Make sure that whatever company you invest with has proper security measures, such as a secure online portal, encryption on all online transactions, and insurance, if applicable. This way, you can rest assured that your gold investments are safe and secure.

Additionally, check out their track record for any grievances raised on customer service or fraud incidents related to the company. If there are any red flags, it's probably best to move on to another gold investment option.


Flexibility could mean different things for different investors. You may prefer an investment that allows you to buy gold in small, incremental amounts. Others may prefer one that offers the flexibility of converting their gold into cash quickly.

Similarly, still, others may want an investment that allows them to move all or some of their gold holdings with no hassle or one that allows them to spread the risk across the various types of gold investments.

Associated Risks

As with any investment, there are associated risks and potential for losses that you should be aware of. Gold investments can offer lucrative returns, but they can also come with significant risks.

Depending on the type of investment, you could face risks such as theft, counterfeit products, or devaluation.

Additionally, market conditions and geopolitical events can lead to unpredictable changes in gold prices, and if you are not up to date with the latest market conditions, your investments could suffer.


Different countries have different rules and regulations on taxation regarding gold investments, so make sure you understand how your country's laws will affect your investments.

In some cases, taxes can add up quickly because gold investments may be subject to income tax, capital gains tax, or both.

Depending on the type of gold investment you choose, you may also have to pay taxes on the profits you make when selling.

These can significantly reduce your investment returns, so research and understand all the associated taxes before deciding what investment to make.

What are Gold Accounts?

Gold Accounts vs Physical Gold

These financial instruments allow you to invest in gold without physically buying the metal itself. They are an exclusive type of financial account offering exclusive features to those seeking more out of their banking experience.

Gold accounts offer a way to store and trade the gold with the use of online accounts, making the process much easier and faster than investing in physical gold. They typically provide a higher level of security, with multiple layers of authentication to confirm your identity whenever you want to access your finances.

Gold accounts are typically held at banks or other financial institutions, where they can be traded. They can be purchased with cash, but they are often bought and sold through a broker. The gold stored is typically held in the form of derivatives.

Gold accounts typically offer added benefits, such as special discounts on products and services. They may come with add-on credit cards or insurance packages that make managing your money easier. This not only adds convenience but also offers peace of mind knowing that you are in control of your finances.

In addition, some banks offer even more features, such as discounts on foreign currency exchanges, free educational services, or even additional reward points redeemable in the store or online. Some even offer a loyalty program that rewards customers with gifts or discounts when they reach certain thresholds.

Forms of Gold Accounts

Gold accounts come in two forms: allocated and unallocated.

#1. Allocated Gold Accounts

An allocated gold account is a form of vaulted gold where the investor owns specific bullion bars stored in a secure vault. You buy your own gold bullion and store it safely in a regulated vault - meaning that you have physical ownership and control over your assets.

Unlike other types of gold investments, these accounts don't require you to buy and sell shares or trade online; instead, you can keep track of all related transactions via online platforms or your own record-keeping. As such, investors can track their bars' exact weight, purity, and serial numbers as each bar is identified and separately stored.

These accounts offer other advantages like security, convenience, low storage fees compared to other options, and even potential tax benefits. This could be the right option if you're looking to diversify your portfolio.

#2. Unallocated Gold Account

This type of account acts as an intermediary between investors and bullion dealers. It allows individuals to purchase gold in the form of digital credits instead of physical gold bars or coins.

These digital credits are backed by an underlying inventory held by the bullion dealer, but no specific gold bars are allocated to a customer's account. This means that customers do not have a legal title to their gold and cannot redeem the metal for physical delivery.

It is relatively easy to open and manage, which makes it a popular choice for investors who may not have the time or knowledge to trade physical gold markets. It allows individuals to easily buy and sell gold and settle transactions quickly with online deposits or withdrawals.

Additionally, investors can purchase small amounts of gold without investing significant sums of money due to the relatively low price volatility associated with unallocated gold accounts.

Unallocated gold accounts can be used as an investment, allowing investors to make a return on their money through potential gains in the gold price. They allow individuals to gain exposure to the fluctuations of gold prices while simultaneously diversifying their portfolios.

They are a great way for people starting their investing journey—or anyone looking for a secure portfolio expansion option—to gain full exposure to the world of precious metal trading.

What is Physical Gold?

Gold Accounts vs Physical Gold

This is the traditional form of investing in gold. It is a tangible asset that can be stored and moved, making it an ideal choice for investors who want to buy and hold their gold bullion.

When investing in physical gold, investors can choose between different forms of gold and premiums over spot. Premiums are the additional cost of buying gold above its spot price. This is due to the manufacturing costs and distribution fees associated with physical gold and its scarcity.

Physical gold comes in many forms, including coins, bars, and rounds. Governments worldwide produce gold coins as legal tender with a face value attached to them. They come in various sizes ranging from 1/10th of an ounce to 1 kilogram.

Governments also produce gold bars, which come in various sizes ranging from one gram up to 400 ounces. Typically, the larger the bar, the lower it's premium over spot.

In contrast, gold rounds are produced by private mints. They have no face value but depict various designs ranging from fantasy to historical motifs.

Physical gold is the most popular choice for long-term investors because it allows them to diversify their portfolios and protect their wealth against inflation. It is also considered one of the safest investments since its value typically rises during economic turmoil and uncertainty.

It can be stored in various locations, including bank vaults and home safes. It is important to research local storage options and ensure your gold is insured in case of theft or damage.

It also offers investors a tangible asset that can be held by hand, making it an appealing option for those who want to own their gold outright. This is especially beneficial for those who prefer tangible assets over paper investments or those who love collecting coins and bars with special designs for numismatic purposes.

However, there are some drawbacks to owning physical gold, such as storage costs, shipping fees, and potential taxes, depending on where you live. So before investing in physical gold, it is important to understand the associated costs.

Gold Accounts vs. Physical Gold

Gold Accounts vs Physical Gold
Gold Accounts vs Physical Gold

Return on Investments

Gold accounts offer investors the potential to earn investment returns when gold prices increase. This is particularly because gold accounts allow for buying and selling of gold in small quantities, which can be done quickly and easily.

Physical gold, however, does not offer any returns. It is only a form of savings that can be used to make purchases or held as an investment. It offers only nominal returns when sold in the market, and there are associated costs and taxes when buying or selling gold.


Gold accounts are usually more liquid than physical gold. This is because they can be sold or bought instantly at the current market prices. Also, with the negligible transaction costs, converting the gold stored in accounts into cash when needed is easy.

Furthermore, investors can also benefit by accessing their accounts quickly and easily via an online platform. Thus, gold accounts are often the preferred option for investors who need access to their money quickly.

With physical gold, on the other hand, investors may need to wait for some time before they can convert their physical gold into cash. This is because it may require time to find a buyer, negotiate and sell it.


Gold accounts offer more convenience than physical gold. This is because investors can buy and sell their gold at the click of a button without the need for transport or storage. They simply have to log in to their accounts through an online platform and make the transactions.

On the other hand, physical gold requires manual handling and transportation, which can increase its costs. It also needs to be stored safely, making it more difficult to access quickly when needed.

Associated Costs

When it comes down to purchasing physical gold, there can often be quite a large initial investment cost, and there may also be additional charges for shipping and insurance. Furthermore, extra fees must be factored into the equation if you opt to store your precious metal.

On the other hand, you could avoid all these expenses by opting instead for a gold account solution. The only associated costs are those of the gold purchased and any fees charged by the provider. This can make it a more cost-effective option for those on a budget.


Gold accounts offer more security compared to physical gold. Since transactions are done online, there's no risk of the gold being stolen from the account. However, they are subject to cyber-attacks and other security risks that come with online transactions.

On the other hand, physical gold is vulnerable to theft if not stored securely. Thus, it is important to ensure that the gold is stored securely in a safe place and insured against losses.


Gold accounts offer more flexibility than physical gold. For example, they allow investors to buy and sell small amounts of gold. This is particularly beneficial for those who wish to invest in gold but cannot afford large amounts of it.

On the other hand, physical gold can only be bought or sold in larger quantities, which may not suit everyone's needs.

Furthermore, gold accounts also enable investors to purchase gold from various locations across the globe and store it in one secure account. This offers investors more freedom when it comes to diversifying their accounts.

Physical gold, however, is limited to the locality in which it is bought or sold.

Risks Associated

Gold accounts do not come without risks. As with any gold investment, there is always the risk of market volatility and price fluctuations which can affect the value of the gold stored in an account.

Additionally, when investing in gold accounts, cyber-attacks and counterparty risks associated with online transactions are also a concern.

On the other hand, physical gold is subject to theft if not stored securely. As such, it's important to ensure that physical gold is stored safely and securely if you choose this investment.


Regarding taxation for gold investments, the rules are different for each country. Generally, gold accounts will be subject to capital gains tax depending on the jurisdiction in which they are held.

Physical gold, in contrast, is usually exempt from any kind of taxation unless it is sold in a recognized exchange or market and thus may offer better tax benefits.

So, Which is Better?

The answer depends on what you're looking for. Gold accounts are a great way to invest in gold without having to deal with the physicality of the metal. You can usually open a gold account with very little money, and they come with easy access to your funds and other benefits, such as making transfers and withdrawals quickly.

On the other hand, physical gold can be a great way to access gold's value without relying on third-party services. It also provides tangible security and the potential to increase in value faster than gold accounts. Additionally, possession may provide tax benefits if you have a large amount of gold.

Ultimately, it's up to you to decide which investment option is better for you. Want to learn more about investing in gold? Talk to an expert today. They can help you make a fully informed decision and provide tailored advice and guidance to ensure you get the most out of your gold investments.

If you are looking to invest, don't forget to checkout our highest recommended companies!

>> Click Here To See Our Top 5 Recommended Precious Metals Investment Companies <<

Currently our #1 recommendation is offering up to $10,000 in free silver!

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