When you think of gold, what comes to mind? Eighteen-karat gold jewelry? Gold bricks stacked high in a vault? Sacks of gold coins used for bartering or paying tax collectors in Robin Hood’s days? Or a sensible part of a modern investor’s asset allocation strategy?

Although global economies do not depend upon gold in the way they once did, gold is still an attractive investment. Why is that? And exactly how do you invest in gold?

The Allure of Investing in Gold

Gold can be a sound investment because, unlike currencies and securities, gold is in limited supply. (The gold supply increases as more gold is mined, but very slowly). Thanks to this scarcity, gold serves as a hedge against inflation. An ounce of gold can buy roughly the same amount of goods today as it did 50, 100, even 200 years ago. That’s not the case, of course, with a dollar bill. In fact, the value of gold typically increases as the value of a dollar falls.

For this reason, gold is a good choice for investors who want to insulate themselves somewhat from the inevitable effects of inflation. And who doesn’t?

But how do you make this happen? Believe it or not, buying gold (even physical gold coins) is doable for the average investor; you simply need to take the time to do it right. [...]

Say you inherit, win, or earn $3,000, $30,000, or even $300,000. Lucky you.

What should you do with a windfall of money?

You may be inclined to spend it; to buy a new ride or take the trip you’ve been longing for. The urge to splurge is normal; people are more likely to spend unanticipated money (i.e., a windfall) than anticipated money, like wages (Arkes, Joyner, et. al., 1994). Unfortunately, spending your windfall—or at least all of it—probably isn’t the best move.

Here’s a prioritized list of arguably the best ways to use a windfall. Your individual situation may dictate deviating from this list slightly, but this is solid foundation for planning how to use unexpected money. (Note: You may decide to split your windfall among a few of these goals; that’s fine.) [...]

Finding the right stock broker can be overwhelming. There is a glut of brokerage companies out there—both online and full service—and each service claims to be the best. So how, exactly, can you tell which broker is right for you?

As you approach shopping for a new broker, you need to decide which services you want and how much you are willing to pay for them. Plenty of broker ratings and customer satisfaction surveys exist, but high survey scores won’t matter if the broker you choose doesn’t meet your specific needs.

Before you dive into your stock broker search, ask yourself these questions:

• How much do you want to invest?
• What investing strategy will you use?
• What type of products will you invest in?
• How much customer support will you need?

Having these answers will be critical in evaluating potential brokers. Why ask these questions? Let’s look at each one in greater detail. [...]

About 75 percent of Americans have done at least a little saving for retirement. Yet only 55 percent of full-time employees in America contribute to an employer-sponsored 401(k) or 403(b) retirement plan, according to reports by the Employee Research Benefit Institute.

Although some employees choose not to contribute their employer’s 401(k) plan, other employees would love to invest in a 401(k) plan but can’t; their employer doesn’t offer one. In some cases, an employer may simply choose not to offer a 401(k) plan. Or, you may not be eligible for the plan because you either work part-time or haven’t worked long enough to qualify. [...]

Exchange-traded funds, or ETFs, are sooo hot right now, and with good reason. ETFs allow investors to purchase an entire index with the same convenience and cost of buying a single stock. Are ETFs a wise move for you?

ETFs Defined

The “exchange-traded” part of exchange-traded fund means that investors can buy and sell ETF shares on major stock markets all day long. Unlike individual stocks, however, ETFs hold numerous companies that share a common bond. Stocks comprising an ETF may belong to the same index (like the Dow Jones Industrial Average) or all share the same size and industry (for example, small-cap financial stocks). [...]

There are a lot of reasons to open an individual retirement account (IRA). If your employer doesn’t offer a retirement plan, offers lousy investment choices, you’ve maxed out your 401(k), or simply want greater control over your retirement savings—an IRA is for you.

Anybody under age 70 ½ who is earning an income can open an IRA. You can choose between a traditional IRA and a Roth IRA. Which one you choose depends on your income and the tax bracket you predict you’ll fall into in retirement. [...]

Whether you’re just starting your first “real job” or have been in the workplace for a few years but haven’t gotten around to saving for retirement yet, listen up: it’s never too early to start building a nest egg. Statistically, young workers are the least likely to contribute to a 401(k) or IRA. But the sooner you start saving for retirement, the more compounding interest will help you grow wealthy with time. [...]

Any traders out there? Open an account with Zecco before 9/13/09 and get 20 free trades. [...]

Has a friend or family member ever asked you for a loan? Or, have you ever considered lending money—perhaps through social lending—in order to earn better returns than you can with your savings account? If so, you have probably worried about the risks involved in lending money. For one, you always risk losing some or all of the money you lend. And, if you lend to family or a friend, you risk letting the loan get in the way of your relationship. But if you’re considering lending money (either to help out somebody you trust or for your own financial gain), there are ways to mitigate your risk and ensure a smooth transaction. [...]

When it comes to investing, my advice is simple. Buy index funds and no-load mutual funds and ignore the stock market (and the endless media analysis and speculation on individual stocks). It’s easy enough to understand, but where should starting investors turn for guidance on which funds to choose? Kiplinger’s maintains a list of its favorite 25 mutual funds. Fifteen of those funds are “no-load” (i.e., they don’t charge a sales fee to invest in them). Here they are: [...]