How Much Gold Should You Own?
The right allocation depends on your age, risk tolerance, and goals. Here's a framework to help you decide—not a sales pitch to buy as much as possible.
The Short Answer
Most financial advisors recommend 5-10% of your portfolio in precious metals (gold + silver). Conservative investors might go 5%, while those concerned about inflation or economic instability might go up to 15-20%.
Gold is insurance, not a get-rich-quick investment. Treat it accordingly.
Why Own Gold at All?
Before deciding how much, understand why you're buying:
✓ Good Reasons to Own Gold
- • Portfolio diversification
- • Hedge against inflation
- • Protection during market crashes
- • Insurance against currency devaluation
- • Generational wealth transfer
✗ Wrong Reasons
- • Expecting massive short-term gains
- • Fear-based panic buying
- • "Gold is going to $10,000!"
- • Putting all your savings in gold
- • Buying because a salesman scared you
Allocation by Risk Profile
| Profile | Gold Allocation | Reasoning |
|---|---|---|
| Conservative | 5% | Basic diversification, low maintenance |
| Moderate | 5-10% | Balanced protection without over-concentration |
| Inflation-Concerned | 10-15% | Stronger hedge against currency devaluation |
| Crisis-Focused | 15-20% | Maximum protection, accepts opportunity cost |
Important Note
Going above 20% in precious metals is generally considered excessive. Gold doesn't pay dividends or generate income. Too much allocation means missing out on growth from stocks, real estate, and other assets.
Allocation by Age
20s-30s: 5% or Less
Time is on your side. Focus on growth assets (stocks, real estate). A small gold position provides diversification without sacrificing compounding potential.
40s-50s: 5-10%
Start shifting toward preservation. Increase gold allocation as you have more to protect and less time to recover from market crashes.
60s+: 10-15%
Wealth preservation becomes priority. Gold protects against sequence-of-returns risk and provides stability during retirement withdrawals.
The Math: What Does 10% Look Like?
| Net Worth | 5% in Gold | 10% in Gold | 15% in Gold |
|---|---|---|---|
| $100,000 | $5,000 | $10,000 | $15,000 |
| $250,000 | $12,500 | $25,000 | $37,500 |
| $500,000 | $25,000 | $50,000 | $75,000 |
| $1,000,000 | $50,000 | $100,000 | $150,000 |
At current gold prices (~$2,600/oz), $10,000 buys approximately 3.8 ounces of gold. That's a 10% allocation for someone with $100,000 in assets.
Gold vs. Silver Split
If you're allocating to precious metals, how should you split between gold and silver?
70/30
Gold / Silver
Conservative, stability-focused
60/40
Gold / Silver
Balanced approach
50/50
Gold / Silver
Higher upside, more volatility
Our Recommendation
For most investors, 5-10% in precious metals provides meaningful diversification without sacrificing growth potential. Start at the lower end if you're young, increase as you approach retirement.
Within that allocation, a 70/30 gold-to-silver ratio offers stability with some upside potential.
Don't let fear-based marketing push you to over-allocate. Gold is insurance—and you don't spend your entire budget on insurance.