Connect with us

Personal Finance

ETFs make it to invest in gold. Taxes may be the tricky part

Published

8 months ago

on

Frame Studio | Moment | Getty Images

For investors who want to add gold to their portfolios, exchange-traded funds offer an easy way to do it.

Just be sure to keep your expectations in check and know what it can mean for your tax situation, experts say. Depending on how the ETF is structured, any gains may be taxed at a different — and sometimes higher — rate than you expected. And while gold can offer a store of value during turbulent market times, the price tends to be volatile.

“It’s going to bounce up and down, and it’s not always going to work in your favor,” said Dan Sotiroff, senior analyst at Morningstar. 

Why gold is drawing ETF investors

The value of one troy ounce (32.1 grams) of gold has skyrocketed over the last year, jumping nearly 60% to $4,204 at Tuesday’s market close from $2,638 a year ago. In comparison, the Standard & Poor’s 500 index has climbed about 12.9% in that time, closing Tuesday at 6829.37. The surge in price has been attributed to a variety of factors, including increasing demand from both central banks and individual investors — for the latter, that has included investing through ETFs.

Some experts expect the spot price of gold to reach $5,000 in 2026. If the Federal Reserve lowers its benchmark interest rate when it meets next week, that could draw more investors because gold tends to perform better in low-interest-rate environments.

Nevertheless, it’s typically a good idea to limit your investment to no more than 5% of your portfolio, said certified financial planner David Rosenstrock, director of financial planning and investments at Wharton Wealth Planning in New York. He generally doesn’t recommend including gold in investment portfolios.

Over the long term, “gold tends to underperform asset classes like stocks and bonds quite noticeably,” Rosenstrock said. “While a small percentage difference in annual returns might not seem significant, it can greatly affect an account balance when compounded over many years.”

Some ETFs invest directly in physical gold

If you do decide you want to invest in gold, ETFs offer a way to do so without having to physically own the gold yourself. Like all ETFs, they trade throughout the day like stocks. Most are passively managed, meaning they track an index and its performance, for better or worse.

These funds also are a small slice of the ETF universe, with roughly a few dozen in existence compared with the total number of ETFs — more than 4,300, according to Morningstar Direct data.

Some ETFs invest directly in gold bullion. Each ETF share represents a certain amount of that physical gold. The largest one of these is SPDR Gold Shares (GLD) with $140 billion in assets, Sotiroff said.

More from ETF Strategist:

Here’s a look at other stories offering insight on ETFs for investors.

If you invest in one of these ETFs through a taxable brokerage account, be aware that any profit when you sell may be taxed differently than gains on other investments like stocks and bonds, said CFP Patrick Huey, owner and principal advisor with Victory Independent Planning in Naples, Florida. 

Short-term capital gains — profits on assets held for a year or less — face ordinary income tax rates, which is standard and range from 10% to 37%.

However, even if you hold on to your gold ETF for more than a year, typical long-term capital gains tax rates — which are 0%, 15% or 20%, depending on your income — do not apply.

“From a tax standpoint, [gold is] treated as a collectible by the IRS, so long-term gains … are taxed at a maximum rate of 28%,” Huey said. 

That holds true even if you invest in gold through an ETF. Investors with incomes that fall into higher tax brackets end up paying that rate.

Other ways to invest in gold through ETFs

You can also invest in gold through another type of ETF: Those that invest in gold futures contracts — for example, Invesco DB Gold Fund (ticker: DGL).

“These funds use derivatives rather than hold physical gold,” Huey said.

That also results in an unusual tax treatment. Generally speaking, gains on these gold futures ETFs “are governed by the IRS’s so-called 60/40 rule,” Huey said.

This means that whatever long-term gains tax you’re subject to will apply to 60% of the gain, and ordinary tax rates will apply to 40% of it, no matter how long you’ve held the ETF. 

Another route to investing in gold via ETFs is through those that invest in gold-mining companies, such as VanEck Gold Miners ETF (GDX).

“The basic idea is it’s an indirect exposure to gold; the benefits to the mining businesses are tied to the price of gold,” said Sotiroff, of Morningstar.

However, he said, the prices tend to be “extremely volatile.”

“And you’re getting exposure to businesses, not just to a yellow rock,” Sotiroff said.

In other words, you are investing in companies — which means you should be confident in the sector’s future prospects for profits and growth.

For these gold-mining ETFs, any profits you reap would be taxed at normal short- and long-term gains rates.

Related Topics:
Continue Reading

Personal Finance

$20,000 Caution Bond Requirement for US Visa Applications imposed on 50 Countries

Published

6 days ago

on

August 8, 2026

By

The United States Department of State has officially implemented a revised visa policy introducing a mandatory posting requirement for caution payments of up to $20,000 on select foreign travel applications. Under the updated regulatory framework, consular officials are authorized to require temporary nonimmigrant visa applicants from targeted foreign countries to post a refundable financial bond of $20,000 as a condition for visa issuance. The policy mechanism is designed to address diplomatic concerns regarding high overstay rates among temporary visitor, business, and educational visa categories.

The caution bond pilot program applies selectively to foreign nationals from designated countries whose diplomatic entities record historical visa overstay rates exceeding established federal thresholds. Under administrative guidelines published by the State Department, the full financial deposit is posted directly to a dedicated federal escrow account prior to final visa issuance. The entire caution payment is automatically refunded to the applicant upon verified proof of timely departure from the United States in strict compliance with the authorized duration of stay. Conversely, failure to depart within the legal timeframe results in full forfeiture of the posted financial bond to the United States government.

Diplomatic representatives and travel policy experts have expressed varying perspectives regarding the operational implementation of the caution bond system. Administration officials emphasize that the measure serves as an effective, market-based incentive to enforce international travel compliance and preserve domestic immigration security standards. However, international trade organizations and foreign diplomatic missions have raised concerns regarding the financial burden imposed on legitimate business travelers, foreign students, and commercial partners from developing nations.

The United States finalized the rule to make the temporary visa bond program permanent, taking effect on August 3, 2026. The updated permanent regulation replaces the prior 12-month pilot, eliminates the lowest $5,000 tier, and raises the maximum required bond amount to $20,000 for specific B-1/B-2 business and tourist visa applicants.

Here is the list of the 50 countries on the list as o August 3, 2026

African Nations (31 Countries)

  • Algeria
  • Angola
  • Benin
  • Botswana
  • Burundi
  • Cabo Verde (Cape Verde)
  • Central African Republic
  • Côte d’Ivoire (Ivory Coast)
  • Djibouti
  • Ethiopia
  • Gabon
  • The Gambia
  • Ghana
  • Guinea
  • Guinea-Bissau
  • Lesotho
  • Malawi
  • Mauritania
  • Mauritius
  • Mozambique
  • Namibia
  • Nigeria
  • São Tomé and Príncipe
  • Senegal
  • Seychelles
  • Tanzania
  • Togo
  • Tunisia
  • Uganda
  • Zambia
  • Zimbabwe

Asian & Eastern European Nations (11 Countries)

  • Bangladesh
  • Bhutan
  • Cambodia
  • Georgia
  • Kyrgyzstan
  • Mongolia
  • Nepal
  • Papua New Guinea
  • Tajikistan
  • Turkmenistan
  • Uzbekistan

Caribbean & Latin American Nations (5 Countries)

  • Antigua and Barbuda
  • Cuba
  • Dominica
  • Grenada
  • Venezuela

Oceanian Nations (3 Countries)

  • Fiji
  • Tonga
  • Vanuatu

Continue Reading

Personal Finance

Next-Generation Retirement Planning: Managing Longevity Risk and Variable Income Streams

Published

1 week ago

on

August 7, 2026

By

Retirement planning strategies are evolving in 2026 to address increased life expectancies, shifting dynamic market conditions, and the transition away from traditional defined-benefit pensions. Individual investors and financial advisors are abandoning rigid retirement models in favor of flexible, multi-asset strategies designed to mitigate longevity risk and preserve purchasing power over multi-decade retirement horizons.

Mitigating Longevity Risk with Dynamic Asset Allocation
As average life expectancies extend past eighty-five years, one of the primary financial risks facing retirees is outliving their accumulated wealth. Traditional fixed income allocations—such as the standard 60/40 equity-to-bond portfolio—are being reevaluated to ensure portfolios generate sufficient capital growth alongside reliable income.

Financial planners recommend maintaining a meaningful equity allocation throughout retirement to offset long-term inflation erosion. High-dividend equity funds, global real estate investment trusts (REITs), and inflation-indexed Treasuries are combined to create diversified portfolios that deliver both growth and income stability.

The Transition to Dynamic Withdrawal Strategies
The classic “4% safe withdrawal rule” is increasingly replaced by dynamic withdrawal strategies that adapt annually based on market performance. Under a dynamic withdrawal framework, retirees adjust their annual distribution rates within pre-set caps and floors:
– Market Upside: During strong market returns, retirees can increase discretionary spending or fund family legacy gifts.
– Market Downturns: During market pullbacks, spending distributions are temporarily reduced to prevent sequence-of-returns risk and preserve core investment principal.

Guaranteed Lifetime Income Options and Deferred Annuities
To establish a guaranteed baseline for essential living expenses, individuals are incorporating modern fixed-indexed and deferred longevity annuities into their broader retirement architectures. Modern annuity structures offer competitive return caps, transparent fee schedules, and inflation-adjustment options.

By funding essential expenses—such as housing, healthcare, and insurance—with guaranteed income streams from Social Security, pensions, and annuities, retirees can manage discretionary investment portfolios with greater flexibility and lower emotional stress during market volatility.

Actionable Steps for Future Retirees
1. Calculate Baseline Retirement Expenses: Determine fixed living costs and map guaranteed income sources to cover essential expenditures.
2. Adopt Flexible Withdrawal Rules: Implement dynamic spending rules to protect investment principal against market downturns.
3. Incorporate Inflation-Protected Assets: Maintain exposure to dividend-growing equities and inflation-indexed bonds to safeguard long-term purchasing power.

Continue Reading

Personal Finance

Building Generational Wealth: Family Governance, Estate Tax Optimization, and Asset Protection

Published

2 weeks ago

on

August 1, 2026

By

As the largest intergenerational transfer of wealth in history accelerates, high-net-worth families, entrepreneurs, and individual investors are placing heightened emphasis on comprehensive estate planning, family governance, and asset protection. Preserving capital across generations requires a balanced approach combining tax-efficient legal structures with open family communication and financial literacy education.

Optimizing Estate Tax Exemptions and Trust Structures
With potential modifications to federal estate tax exemption thresholds on the horizon, proactive estate planning is essential for high-net-worth households. Estate planning attorneys and wealth advisors are establishing multi-generational trust structures to transfer wealth efficiently while minimizing estate and gift tax exposure.

Popular structural strategies include:
– Irrevocable Life Insurance Trusts (ILITs): Utilizing life insurance proceeds to provide liquidity for estate tax obligations without expanding the taxable estate.
– Grantor Retained Annuity Trusts (GRATs): Transferring rapidly appreciating assets to beneficiaries with minimal gift tax consequences.
– Dynasty Trusts: Preserving wealth across multiple generations while providing long-term asset protection from creditor claims and legal liabilities.

Establishing Family Governance and Financial Education
Legal and financial structures alone cannot guarantee long-term wealth preservation without effective family governance. Financial advisors report that a significant percentage of multi-generational wealth dissipation stems from lack of communication and inadequate financial preparation among heir generations.

Families are establishing formal family governance frameworks, including periodic family meetings, written mission statements, and structured philanthropic foundations. Involving younger family members in charitable grant-making and investment discussions fosters financial stewardship and prepares heirs to manage family assets responsibly.

Digital Asset Custody and Legacy Planning
In today’s modern economy, estate planning must extend beyond physical real estate and traditional brokerage accounts to encompass digital assets. Comprehensive estate plans now include detailed inventories and legal access protocols for corporate domain names, intellectual property, digital media rights, and cryptocurrency holdings.

Fiduciaries and estate executors should be provided with secure, encrypted access mechanisms and clear legal authority to manage and transfer digital holdings in accordance with the owner’s estate directions.

Practical Steps for Legacy Planning
1. Review and Update Estate Documents: Ensure wills, revocable trusts, and power-of-attorney designations accurately reflect current family structures.
2. Establish Structured Trusts: Utilize irrevocable trusts to protect assets from creditors and minimize future estate tax liabilities.
3. Create a Digital Estate Inventory: Document access protocols and legal permissions for all online accounts, intellectual property, and digital assets.

Continue Reading

Trending