Gold as a Long-Term Wealth Protector
Gold has long been recognized as a reliable store of value. Over the past 30 years, it has not only kept pace with inflation but, in many instances, has also increased in buying power. For example, in the mid-1990s, gold was priced at about ₹5 lakh per kilogram. Today, it stands at nearly ₹1 crore per kilogram, representing a 20-fold increase. This consistent growth illustrates how gold can effectively protect wealth over time.
Gold vs. Food and Dining Costs
Consider a luxury meal as a simple example. In 1996, a fine-dining plate at a five-star hotel cost around ₹500, which was equivalent to 1 gram of gold at that time.
Today, the same meal costs about ₹7,000, which corresponds to only 0.7 grams of gold. This indicates that gold’s value has outpaced the cost of luxury food. Therefore, if someone had saved in gold, their purchasing power for that meal has increased.
Gold vs. Luxury Cars
In 1996, a luxury car like a BMW was priced at around ₹25 lakh, which equated to approximately 5 kilograms of gold. Today, a similar luxury car costs about ₹60 lakh, but in terms of gold, it is now only around 0.6 kilograms. This demonstrates that the price of luxury cars has not kept up with the value of gold. Someone who stored wealth in gold could now purchase the same car for a significantly lower amount of gold.
Gold vs. Real Estate
The real estate scenario is somewhat different. In 1996, a four-bedroom house in South Delhi cost around ₹30 lakh, equivalent to 6 kilograms of gold. Today, a similar house is priced at about ₹6 crore, which still corresponds to roughly 6 kilograms of gold. This indicates that gold and real estate have appreciated at a similar rate over the past 30 years.
Gold vs. Foreign Travel
Foreign travel has become more affordable in terms of gold. In the 1990s, a trip to Europe for two people would cost around ₹3 lakh, which was equal to 600 grams of gold. Today, a similar trip costs approximately ₹6 lakh, but this is only 60 grams of gold. This shows how gold has enhanced travel affordability as well.
Why Gold Still Matters
Gold remains one of the most effective means of preserving purchasing power. It has consistently outperformed or matched the price increases of many goods and services over the decades. Based on historical data, it seems likely that gold will continue to serve as a reliable store of value in the future.
Has gold helped you combat inflation over the years? Share your experiences in the comments! If you found this article useful, don’t forget to SHARE it with your friends!
