Many people, looking for safer investments, wonder whether they should invest more in gold. While gold is great to have in your portfolio, a little goes a long way when used correctly: as a protection against catastrophic events.

Safety is my #1 concern when it comes to investing. We use a number of protection investments, including some gold, to make sure our clients are bulletproof. Although not a great inflation protection or growth investment, gold is great for protecting them from another 9-11 event or other world calamity. Remember, that to maximize your protection, you need more than just gold.

Think of gold as you would think of an insurance policy: it's there for emergencies. You can afford a lot of protection value for a minimal expense. I like to invest in companies that mine gold, because after 9-11, these gold stock mutual funds increased in value twice as much as gold itself. Gold, like insurance, is an expense. So, if I can reduce the costs by investing in companies that mine gold, I will have more money that I can allocate to growth investments.

Beyond using gold as a protection investment, it doesn't make a lot of sense. Simply put, it is a poor performer and won't pay you dividends. Factored with inflation, an ounce of gold purchased 30 years ago should be worth over $1,600.00 today. It's also not a good idea to put all of your eggs in one basket - remember bulletproofing. Having all of your savings in gold actually makes you less safe.

Despite this information, investors have been gobbling it up lately. The increase in demand has driven the price higher and self perpetuating the craze. This upward swing is unlikely to last. In fact, I predict that gold is going to be the next major financial bubble. The recent rally has over inflated the price of gold and as demand subsides, the price will come back down. The bubble will burst.

Since gold fluctuates based on demand and speculation, it is more volatile than most people think. To really be safe, you need a variety of tools to protect you. While another catastrophic event could happen, you are at much more risk from inflation, deflation and market turmoil. Compared to gold, other protection investments are better at protecting you from these other impacts. When protections are combined together correctly, your investments are bulletproof.

Doomsday worries and concerns about our financial system are spurred on by promoters in order to sell gold to the fearful public. Don't buy into the hype. Even if the economy fell to ruin and our currency became worthless, you would still need to find someone willing to trade gold for the goods you need.

The key to remember is to be bulletproof in your investments. If you are not bulletproof, you are not safe. If you don't know what it takes to make your investments safe, we can help. Bulletproofing will protect you from all but the total collapse of civilization. If you are worried that the end is near: keep a level head, bulletproof your investments, and store a year's supply of food. Then you are ready for anything.