The gold market has experienced significant growth throughout 2024, with prices surging to unprecedented heights and shattering numerous records along the way. Gold’s bull run first started in early March, when the price of gold skyrocketed to $2,160 per ounce — up 8% from the previous price record set in December 2023. The upward trajectory continued from that point, with gold’s price shattering record after record on its climb. That trend is still going strong even now, with gold prices closing in on $2,800 per ounce. 

This meteoric rise has resulted in big returns for the investors who bought in earlier this year. For example, the investors who purchased gold in March when it hit $2,160 per ounce have seen their gold values increase by nearly 27% in the time since. That’s a huge uptick in value in a matter of months, especially on an asset that’s known more for long-term growth.

But while gold’s price trajectory has benefitted those who bought in early in 2024, it has also left newcomers to the market wondering whether now is the right time to buy in. After all, the prospect of buying at historic highs is counterintuitive to the golden rule of investing: Buy low and sell high. So should you invest in gold now, despite its premium price? 

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Should you buy gold now?

You should always tailor your investment strategy to your specific needs. However, there are a few reasons why you may want to add gold to your portfolio now, even at its current high price:

There’s still room for more price growth

While gold prices are already at record highs and are closing in on $2,800 per ounce, many experts believe there’s still room for further price growth. Some analysts believe that gold could reach $3,000 per ounce by year’s end (or shortly after). Several factors support this outlook, including:

• Central bank demand: Many central banks around the world have been steadily increasing their gold reserves. This ongoing demand from institutional buyers could continue to drive prices upward.
• Limited supply: Unlike traditional paper currencies, which can be printed at will, the global gold supply is finite. As demand grows, the limited supply could push prices even higher.
• Expanding industrial use: Gold’s applications in various industries, including electronics and healthcare, are expanding. As new uses for gold are discovered and implemented, industrial demand could further boost prices.

So, by buying in now, investors may be positioning themselves to benefit from any future price increases that occur, even if they seem unlikely given the current high cost. Waiting, though, could mean missing out on buying in at a lower price point.

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You need a hedge against economic uncertainty

Inflation may have cooled significantly over the last few months, but that’s hardly the only economic issue that could impact your investment portfolio. The global economy continues to face numerous challenges, including ongoing geopolitical tensions and economic instabilities. But gold has long been regarded as a reliable hedge against these types of uncertainties, so it makes sense to buy in now. Here’s how it could protect you in an uncertain economic environment:

• By preserving your purchasing power: Gold tends to maintain its value over long periods, often preserving purchasing power even as currencies fluctuate.
• By acting as a safe-haven asset: During periods of severe economic stress or geopolitical turmoil, gold often experiences increased demand from investors seeking safe-haven assets. This makes gold a reliable store of value during turbulent economic times and provides a degree of security that other assets may not.
• By offering high liquidity: Gold is highly liquid and can be easily converted to cash, providing you with financial flexibility during uncertain economic times.

Portfolio diversification still matters

Gold’s unique relationship with other investments is one of the main reasons investors add this precious metal to their portfolios. One of the draws is that gold has historically shown a low or negative correlation with equities and bonds, so when the stock market is experiencing downturns, as it has in recent months, gold often remains stable. 

So by incorporating gold into your portfolio now, even at today’s high prices, you’re adding an asset that doesn’t move in sync with traditional investments. This reduces the overall risk and volatility of your portfolio, ensuring that, even if the other assets you’ve invested in are experiencing losses, a portion of your wealth remains protected. 

The bottom line

Gold’s current price surge has prompted some investors to question whether now is the right time to buy. And while investing in any asset at a record high may seem risky, there are strong arguments for adding gold to your portfolio, even at its current elevated levels. The potential for continued price appreciation, the need for a reliable hedge against ongoing economic uncertainty and the diversification benefits that gold provides all point to the metal’s enduring value as an investment.

Homeowners in need of extra financing have had few cost-effective options over the past few years. One of the cheapest ways to gain access to a large sum of money has involved accessing existing home equity via home equity loans and home equity lines of credit (HELOCs). While alternative credit products came with rates in the double digits (and still do), both of these home equity options come with single-digit interest rates for qualified borrowers. And those rates could fall further now that the Federal Reserve has embarked on what appears to be a new rate-cutting campaign. 

With the first interest rate cut in more than four years issued in September and others likely for when the Fed meets again in November and December, home equity borrowers may be tempted to wait for this formality before withdrawing funds from their home. But, in many instances, that would be a mistake. Below, we’ll break down why you shouldn’t wait for the November rate cut to tap into your home equity.

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Why home equity borrowers shouldn’t wait for the November rate cut

While a rate reduction in November could be beneficial for those who borrow from their home equity, it’s not necessarily worth waiting for that to happen. Here’s why:

HELOCs will adjust automatically

HELOC interest rates are variable and subject to change each month. It doesn’t make sense, then, to wait for a November rate cut if you’re planning to use a HELOC. As rates fall (or rise), HELOC rates will adjust independently. In other words, you’ll earn the benefit of a lower HELOC rate in November no matter when you open the line of credit. Delaying, then, won’t offer any additional benefits than what you would obtain simply by acting now.

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Rates won’t fall precisely by the same amount

Rates on both home equity loans and HELOCs are influenced by what the Fed does but they’re not directly dictated by it. So they’re unlikely to fall by precisely the same amount that the federal funds rate does. Some lenders may even preemptively price in presumed rate reductions, meaning that what you’re offered in the days after a rate cut is unlikely to be materially different from what you could’ve secured in the days before the Fed took action. Waiting, then, won’t make much difference.

You’re running out of time to use it as a tax deduction

Interest paid on home equity loans and HELOCs is tax-deductible if used for eligible home repairs and renovations. But with barely two months left in 2024, you’re running out of time to use these products as a qualifying tax deduction. If you wait for rates to fall in November, then, your tax interest deduction will be minimal when you file your return in the spring. Instead, much of the use of the loan — and its tax benefits — will be pushed off into 2026.

Your expenses can’t be delayed

If you need a large sum of money, as many who borrow from their home equity do, it’s likely that the expenses you need it for can’t be delayed. If you’re planning on using your home equity to consolidate debt or to pay off what you owe to credit card companies, for example, then it doesn’t make sense to delay. With the average credit card interest rate near 23% now while the average home equity loan and HELOC interest rates are under 9%, you’ll lose money by continuing to use the former instead of the latter. So don’t delay in anticipation of a slight rate cut.

Use your home equity to pay off your high-rate credit card debt now.

The bottom line

Waiting for a November rate cut may be advantageous for some borrowers but, arguably, not for home equity users. Since HELOCs will see their rates adjust automatically, and because rates are unlikely to fall precisely as the federal funds rate does, it may not be beneficial to wait for that to happen. And if you’re planning to use it for home repairs and renovations, the window of opportunity to deduct the interest from your 2024 taxes is closing. Plus, some expenses simply can’t be delayed, particularly for what is likely to be a marginal benefit, at least with a small rate cut in November. For all of these reasons, it makes sense to take action now. Just do so in a measured fashion as your home is collateral in these borrowing circumstances so you’ll want to avoid risking your ownership if you can’t ultimately repay all that you’ve withdrawn.