With 500 million VND, should I buy gold or save in the bank?

After many years of working, saving, and accumulating, Ms. Thu Thuy ( Hanoi ) has 500 million VND. Ms. Thuy is saving this money in the bank.

However, the interest rate has been continuously decreasing, and September is the deadline for interest payment. Ms. Thuy is calculating whether to continue depositing all the money in the bank or withdraw half of it for investment.

“I am planning to save 300 million VND in the bank and withdraw 200 million VND to buy gold. From now until the end of the year, if the gold price increases more than the current purchase price, I will sell it and wait for the price to decrease and buy again. Is this method okay?” Ms. Thuy wondered.

Perhaps, not only Ms. Thuy but many people who have a few hundred million dong in savings are also thinking and calculating the same thing.

To help Ms. Thuy have more basis to make a decision for herself, we brought her question to an economic expert for more advice.

Hesitating between saving in the bank and buying gold when having 500 million VND. (Photo: Hoang Ha)

Sharing with VietNamNet reporter, Dr. Nguyen Tri Hieu, a finance and banking expert, said that investing in anything and anywhere must ensure three principles. That is, it must be profitable, capital safety and the investment must have liquidity.

According to Mr. Hieu, depositing money in the bank meets all three of these requirements. At the present time, depositing money in the bank is the safest option.

“In terms of profitability, although bank interest rates are lower than before, they are still good. You can still get an interest rate of 5-7% with an amount of VND500 million at small banks that need capital.

At the same time, you can withdraw money from the bank at any time you need it. Even though you will have to pay a fine, the principal of 500 million VND can be recovered at any time," Mr. Hieu analyzed.

However, this expert believes that the option of dividing this 500 million VND into 300 million VND in savings and 200 million VND to buy gold can also be considered.

According to Mr. Hieu, the US Federal Bank still has the ability to increase interest rates. That interest rate increase will put downward pressure on gold prices and increase the value of the USD.

However, according to his assessment, from now until the end of the year, the world gold price will increase. This will cause the domestic gold price to also increase.

“If you spend 200 million VND out of 500 million VND to buy gold, you can consider it. However, playing with gold is very risky. You have to be someone who has the technique to invest in gold, and has a way to buy gold that can control the risk and loss of value.

I do not recommend buying gold, but you can consider buying gold in addition to saving money in the bank. When the gold price increases, there will be a higher return than saving money in the bank,” Mr. Hieu said.

However, “playing” with gold is riskier than depositing money in a bank. Therefore, this financial and banking expert still recommends that at this time, saving money is still the optimal option for those with relatively small amounts of money.

Commenting on interest rates from now until the end of the year, Associate Professor, Dr. Dinh Trong Thinh, an economic expert, shared that after the State Bank's policy interest rate cuts, deposit interest rates are now quite low. Lending interest rates are also gradually decreasing.

Therefore, according to Mr. Thinh, from now until the end of the year, interest rates will continue to decline, decrease slightly, and then stabilize. Low interest rates are also very good for capital mobilization activities as well as capital costs for the economy and promote economic growth.

At the end of the trading session on August 19, the price of 9999 gold bars at SJC Ho Chi Minh City was 67 million VND/tael (buy) and 67.7 million VND/tael (sell). SJC Hanoi listed at 67 million VND/tael (buy) and 67.72 million VND/tael (sell).

Doji Hanoi listed at 66.95 million VND/tael (buy) and 67.75 million VND/tael (sell). Doji Ho Chi Minh City bought SJC gold at 67.05 million VND/tael and sold at 67.65 million VND/tael.

Since the beginning of the month, gold price at SJC increased by 400,000 VND/tael, while at Doji it increased by 500,000 VND/tael.

Meanwhile, bank interest rates tend to decrease. Currently, the highest interest rates of banks are around 7-7.3%/year for some terms.

Up to now, banks are maintaining the highest mobilization interest rates from 7-7.3% at several terms including: ABBank, PVCombank (6-month term); PVCombank, NCB, CBBank, BaoVietBank (9-18 month term); VietA Bank, HDBank (12-18 months); NamA Bank (12 months); and KienLong Bank, LPBank OceanBank (18 months).

The current common deposit interest rate listed by most banks is from 6-6.9%/year.

According to the latest statistics from the State Bank, as of the end of April, people's deposits in the banking system reached 6.33 million billion VND, an increase of more than 467,000 billion VND compared to the end of last year. This shows that people still choose to save money because it is beneficial and safe.

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