Financial emergencies can strike without warning, whether it’s a sudden medical bill, job loss, or urgent home repairs. In such situations, liquidity becomes crucial. One often-overlooked but powerful tool during these times is gold. Especially in India, where gold holds both cultural and financial value, it can act as a dependable backup when life throws a curveball.
But how exactly can you use Digital Gold wisely during a crisis? Here are key tips to help you make the most of it.
1. Understand Gold as a Financial Safety Net
Gold has long been seen as a store of value. Unlike stocks, it doesn’t fluctuate wildly in a single day, and unlike fixed deposits, it doesn’t require a lock-in period. During uncertain times, such as inflation spikes or economic downturns, gold tends to hold its value or even appreciate.
This makes it ideal for emergencies. Whether held in physical form (like jewellery or coins) or as digital gold, it can be quickly liquidated or used as collateral for short-term needs. Holding some digital gold alongside physical gold adds flexibility to your emergency planning.
2. Prefer Digital Gold for Faster Access
If you plan to use gold specifically as an emergency buffer, digital gold has clear advantages:
-
You can invest small amounts (even ₹10).
-
It’s instantly accessible online.
-
You can sell your digital gold 24/7, directly from your phone.
-
No need to visit a jeweller or bank.
In a medical emergency or sudden cash crunch, that kind of speed can make a huge difference. Digital gold makes liquidity faster and hassle-free.
3. Don’t Use Jewellery as a First Option
It’s tempting to turn to your gold jewellery during a crisis, but it comes with emotional value and often attracts lower resale value due to making charges, impurities, or design deductions. Selling it may also feel emotionally difficult.
Instead, explore other gold formats first:
-
Digital gold
-
Gold coins
-
Gold Exchange Traded Funds (ETFs)
-
Sovereign Gold Bonds (if matured)
Jewellery should be the last resort, not the first option. Building a habit of accumulating digital gold ensures you always have a practical fallback.
4. Use Gold Loans as a Smart Alternative
If you don’t want to sell your gold outright, consider taking a gold loan. It allows you to unlock the value of your gold without losing ownership. Many banks and NBFCs offer quick approvals with minimal paperwork. You can repay it when your finances stabilise.
Compared to personal loans or credit card debt, gold loans:
-
Have lower interest rates
-
Are quicker to process
-
Don’t affect your credit score unless you default
Combining gold loans with your digital gold savings strategy can help manage unexpected expenses efficiently.
5. Keep a Portion of Your Emergency Fund in Digital Gold
A healthy emergency fund should ideally cover 3–6 months of expenses. While most of it should be in cash or highly liquid instruments like savings accounts or liquid mutual funds, a portion (10–20%) in digital gold can act as a hedge against inflation and currency fluctuations.
By doing this, you get both liquidity and value preservation in your emergency fund mix. Setting up a regular digital gold investment can help you reach this goal gradually.
6. Avoid Panic Selling
In a crisis, it’s easy to panic and sell your assets at the wrong time. Gold prices can fluctuate daily. If the emergency allows a little breathing room, monitor the price and try to sell when the rates are favourable. Even a small difference can impact your returns. This applies to both physical and digital gold.
7. Stay Informed and Choose Reliable Platforms
If you’re investing in digital gold, make sure you do it through trusted platforms like InCred Money, MMTC-PAMP, SafeGold, or Augmont. These platforms ensure your gold is:
-
24K pure
-
Stored in secure, insured vaults
-
Easily sellable with transparent pricing
Always verify that your digital gold investment is safe and insured. Avoid unknown apps where your digital gold might not be protected properly.
Conclusion
Gold has been a financial backbone for Indian households for generations, and rightly so. When used wisely, it can be a lifesaver during emergencies. Whether it’s digital gold you can sell instantly, a loan against physical gold, or simply holding gold as part of your emergency fund, this yellow metal can offer both peace of mind and financial relief.
But like any tool, its value lies in how you use it. Plan, stay informed, and treat your gold especially your digital gold not just as a luxury, but as a financial resource you can count on when it matters most.
Ready to go for gold? Start your digital gold journey today on InCred Money.
Source
Digit Life Insurance
