There has been a lot of debate over the years as to whether or not gold is worth investing your money in. Some make the claim that it makes an excellent hedge against inflation; others might say that you can use it as a quick fix for some extra cash. And then there are some that invest in it when the economy is bad because they feel if everything crashes, at least their gold will still carry some value.

So what is it? Is gold a good investment?

Well- let's define "investment" first; really, it should be categorized into a couple of different perspectives. We either invest with a long term approach, or we invest with a short term, turn a quick profit approach. In this article, we'll explore both the short term and long term approaches to using gold as an investment.

Before we consider the above, let's look at how gold has been performing throughout the years and use that data to consider the question.

First, if we were to take all of the years that gold's worth has been calculated up to the present, we would find that gold has improved in value at about 2% annually. In the last 50 years, things have been a little bit better, as gold has been increasing at about 4% annually. So would it be a good long term investment? Doubt it... most good index funds (something that might follow the S&P 500, for example) have been increasing on average at 12% annually in those same years. Do your research- you'll find the same data.

Here's another interesting thing: if you would have bought a bunch of gold back in 1983, you would have purchased it for roughly $510 per ounce. Thinking that it might be "a good hedge against inflation," you hold that investment for the next 20 years or so. By the end of 2005, if you were to have attempted to sell that same gold, you would have made literally NOTHING! That's right- in December of 2005, gold was being sold at $515 per ounce!

If you take inflation running at about 3% into account, you'd have found that gold would have lost you a substantial amount of money.

Is good a good investment? Considering the numbers, it wouldn't be good long term.

How about gold as a short term investment? Currently, gold is being traded for roughly $875 per ounce! In the last several years, it's been increasing at an astounding rate! So now would be a good time to buy, right? Absolutely not! It's only been in the last few years that it's really gained any ground; if you look into history, anytime gold begins to look up, it ends up taking a hard fall. If you would have bought gold in the last couple of years, now might be a good time to sell it!

But what about now? Should you buy it? Well... you decide. Typically, I like to buy low and sell high; don't we all? So... with gold being as high as it is, the worst decision you could make would be to buy it. Don't touch it!

So, in short, is gold a good investment? Absolutely NOT! Stay away from it.