Even in a world of smartphones, index funds, and contactless payments, Canadians are still turning to gold to diversify and protect their wealth from volatility and uncertainty in "paper markets". Gold has been a reliable store of value for centuries, and it continues to play a unique role that stocks, bonds, and equities simply can’t fully replace.

If you are planning for retirement or looking to diversify your savings, the real question is not just “Should I own gold?” but rather “How much gold should I own, and in what form?”

This guide breaks things down into two simple buckets you can use to think about your allocation:

• Core holdings – long-term “financial insurance” you don’t trade often
• Investment holdings – part of your diversified portfolio alongside stocks and bonds

We will also look at how this applies specifically to Canadian accounts like RRSPs and TFSAs.

Why Canadians Still Hold Gold in 2025

Gold continues to attract interest from Canadian investors for a few key reasons:

1. Financial system risk and uncertainty

Gold is one of the few assets that is not someone else’s promise. It does not depend on a bank staying solvent or a government keeping its currency stable. In times of stress in the financial system, many investors increase their allocation to gold as a way to reduce overall portfolio risk.

2. Inflation and loss of purchasing power

When inflation rises faster than the returns on cash, GICs, or even certain
bond orequity markets, the “real” value of your money erodes. Gold has historically been used as a hedge against long-term inflation and currency debasement.

3. Geopolitical and market volatility

Periods of geopolitical tension, economic slowdown, or stock market corrections often drive renewed interest in precious metals. Gold is not guaranteed to go up when markets fall, but it has often behaved differently enough from stocks to help smooth out long-term volatility in a diversified portfolio.

Two Ways to Think About Your Gold Allocation

Instead of trying to chase a “perfect” number, it can be easier to think of your gold allocation in terms of purpose:

• Core holdings – long-term, rarely touched, viewed as insurance
• Investment holdings – part of a diversified investment strategy

1. Core Gold Holdings (“Financial Insurance”)

Your core gold position is what you hold for peace of mind. The goal here is not to trade frequently or time the market but to own an asset that has maintained purchasing power over very long periods of time.

Typical characteristics of a core holding:

• Mostly physical bullion (coins and bars) rather than paper products
• Stored in a secure and insured vault or depository, or in a safe location you control
• Viewed as a multi-decade holding, not a short-term trade

Some Canadians choose to hold part of their core position in a secure domestic vault and, in some cases, diversify storage by also using a reputable facility in another jurisdiction.

How much should this core position represent? There is no one-size-fits-all answer, but many investors consider anywhere from 5% to 10% of their total net worth in precious metals (gold and sometimes silver) as a starting point for a conservative, long-term hedge. More cautious or gold-oriented investors may go higher, while more aggressive, equity-focused investors may choose a smaller allocation.

2. Investment Gold Holdings (Within a Diversified Portfolio)

Your investment gold holdings are the part of your allocation that sits alongside stocks, bonds, cash, and other assets in a more traditional portfolio. The goal here is diversification and risk management, not doomsday planning.

Common ways Canadians hold investment gold include:

• Physical bullion inside a registered account (e.g., RRSP, TFSA) through an approved trustee
• Gold-backed ETFs that track the price of gold
• Gold mining stocks or mutual funds that provide leveraged exposure to the sector

For most mainstream investors, a gold allocation of around 5%–10% of the total investment portfolio is often discussed as a reasonable diversifier. More conservative investors or those worried about inflation may tilt closer to the higher end of that range, while others may prefer a smaller exposure.

If you choose ETFs or mining stocks instead of physical bullion, it’s important to remember that you are holding a financial product, not the metal itself. That can be perfectly fine for many investors, but it is a different type of exposure than directly owning coins or bars.

Holding Gold in an RRSP or TFSA

One of the most common questions Canadian investors ask is whether it makes sense to hold gold inside an RRSP or TFSA. In many cases, it can.

Some key points to consider:

• Certain types of gold bullion and coins are eligible to be held within self-directed RRSPs and TFSAs through approved Canadian trustees and custodians.
• Gold held in an RRSP grows on a tax-deferred basis; gold held in a TFSA grows tax-free (subject to contribution limits).
• There are storage and administration fees for physical bullion in registered accounts, which should be weighed against the diversification and risk-management benefits.

For many investors, a blended approach works well – for example, holding a core physical position outside of registered accounts for ultimate flexibility, and an additional allocation inside an RRSP or TFSA for tax-advantaged growth.

How to Decide on Your Gold Allocation

When deciding how much gold to hold, it can help to ask yourself a few practical questions:

1. What is my risk tolerance? How comfortable am I with volatility in stocks, bonds, and real estate?
2. How close am I to retirement? Investors approaching retirement may want more stability and diversification.
3. How much of my wealth is already tied to Canada? If most of your assets are CAD-denominated, gold can also help reduce currency concentration risk.
4. Do I want physical metal, paper exposure, or a mix? Each has its own pros and cons in terms of cost, liquidity, and convenience.

Because everyone’s situation is different, there is no “magic” number that works for all Canadians. What matters is having a clear rationale for your allocation and making sure it fits your broader financial plan.

Final Thoughts (And a Simple Rule of Thumb)

Gold is not meant to replace a well-built portfolio of quality investments, but it can play an important supporting role. For many Canadians, a reasonable starting point is:

• 5%–10% of total portfolio value in gold and precious metals, split between core and investment holdings
• A mix of physical bullion (especially for long-term core holdings) and such as ETFs or mining funds for easier trading and rebalancing

Over time, you can adjust this percentage as your goals, risk tolerance, and market conditions change.

Disclaimer: This article is for informational and educational purposes only and does not constitute financial or investment advice. Always consult with a qualified financial advisor or tax professional before making decisions about your RRSP, TFSA, or overall investment strategy.