It's important for investors to know what type of gold they own and how they own it. Different forms of gold storage come with different risks, costs, and benefits.
Gold is the world’s most historically accurate money, trusted across millennia and multiple civilizations. After it was no longer officially used as money, gold continued to have a strong track record as a stable, inflation-resistant asset, becoming a cornerstone of portfolios seeking to build multi-generational wealth.
That basically covers the “why” and the “what” for owning gold, but many investors mistakenly overlook the “how” — which can be just as important.
More often than not “how” you own gold comes down to what kind of storage agreement you’ve signed for your gold holdings.
This article goes over the different types of gold storage accounts—and how each one affects your cost, ownership rights, and security.
Understanding the different types of gold storage
Gold storage accounts typically fall into three categories: unallocated, allocated, and segregated. Here’s what each term means.
Unallocated storage
· Ownership: You don’t own specific bars or coins. You own a claim on a general amount of gold.
· Security: Your gold is on the institution’s balance sheet—if they go bankrupt, you are a creditor, and your gold may not be recoverable.
· Fees: Typically low (around 0.10% annually or in some cases free), but you carry greater counterparty risk.
· Use Case: High liquidity, accurately tracks the gold price, but misses a key benefit of owning gold because it’s exposed to a counterparty’s balance sheet.
Allocated storage
· Ownership: You own specific, identifiable bars or coins held in a secure vault facility, or you own a proportionate amount in those same bars or coins (allocated pool), e.g. 20.5021 ounces of a 100 oz bar.
· Security: Your gold is off the provider’s balance sheet, reducing bankruptcy risk.
· Fees: Moderate (usually ~0.50% per year) due to additional handling, accounting, and insurance of individual items
· Use Case: Can be as liquid as unallocated but without the counterparty’s financial exposure, making it more suitable for gold owners looking for direct ownership.
Segregated storage
· Ownership: You own specific products that are stored separately from all other gold products.
· Security: Highest physical security and clarity of ownership.
· Fees: Higher (often ~0.70 to 1% or more annually) due to the requirement of physically separating your holdings from all other vaulted material.
· Use Case: Investors wanting maximum control and physical isolation.
Each of the above storage agreements have different ownership terms which impact the security, cost, and use case for that particular approach. Investors should pay close attention to their storage agreement to ensure they are holding the gold exactly how they want it.
But what about Monetary Metals? Where do Monetary Metals accounts fit into this picture?
Monetary Metals: A new way to hold gold
Monetary Metals offers a new model that flips the traditional storage paradigm on its head. Here’s how it’s both similar, but different. Monetary Metals offers the ability to store your gold for free or lease it for a return, currently 4% annually. Clients can choose how much of their gold to store, and how much to lease. Here’s how that compares to conventional storage options.
· Ownership: Clients maintain legal title to their gold—as either allocated pool (when in storage) or as a s__pecific gold product__ during a lease. When gold is leased it is still allocated in the sense that there’s always physical gold present that legally belongs to you.
· Security: Gold in storage is held in a professional depository institution and fully insured. Gold in lease is tracked with 24/7 monitoring, covered under multiple insurance policies, and only permitted in certain secure locations defined by the lease agreement.
· Fees: None! Store your gold for free or lease it for an annual yield.
· Yield: Instead of paying storage fees, clients can lease their gold and earn up to ~4% per year, paid in gold.
· Flexibility: You can lease part of your gold and store the rest—for free.
Monetary Metals offers direct gold ownership with all the benefits of professional security and insurance, plus an added upside: your gold can grow while you hold it.
Storage cost comparison
The chart and table below illustrate how each gold storage option compares on cost and yield
Why this matters now
With gold prices rising and inflation chipping away at fiat returns, investors need every advantage they can get. Paying to store gold in a vault year after year is a silent drain on your portfolio.
By choosing allocated gold that earns a yield with Monetary Metals you can protect your wealth—and grow it.
Final thought: don’t just store gold—put it to work
Gold storage serves a vital purpose as everyone needs the option to hold gold in a way that’s immediately accessible and secure. But that’s not the only way to hold gold. Monetary Metals offers both storage and opportunities to earn a yield. Instead of only paying vault fees, you can:
· Store your gold for free
· Earn a yield in gold through gold leases
· Maintain legal ownership and security
Gold has always been a smart long-term asset to hold. With gold yield from Monetary Metals, it just got smarter. Learn how to open an account with Monetary Metals.
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