HelloGold Review (12 months in)
Gold has been touted as the hedge against inflation & bad times. Furthermore, gold holds a very special place amongst humans since the beginning of time. I’m thinking it’s just because we love shiny stuff. Nowadays, the use of gold is… questionable. Even countries have diverted out of the Gold Standard some time back (aka. peg their currency to gold prices).
Even so, investing in gold is still a thing in the present. Most notably with older folks. Nowadays, a lot have opted with cryptocurrencies which is hailed as the new gold by the new generation. But there is a fundamental difference in the 2: that is, one is a physical commodity, whilst the other is purely digital.
Today, we’re not discussing that. I still believe gold has a certain investment merit (worst case scenario, if the world goes to shambles, we can use gold to barter trade for things or throw at someone).
My investment journey with gold started 12 months ago with HelloGold. And today, I’d like to put down my thoughts about this platform.
*This is purely my personal experience and is not a sponsored post!
What is HelloGold?
Established in 2015, HelloGold is an app that is built to cater for investment in gold with as low as RM1. (link to website here)
A few notable highlights about this app:
- Gold invested is 99.99% investment grade
- Live gold prices every minute
- Withdrawal to bank account
- Send and receive gold on the platform
- Redemption of Gold from a minimum of 1g
- Shariah-compliant
- Availability of an auto-investment plan (my favourite function and I will get to that later in this post)
Look & feel of the HelloGold app
The app is very simple and straightforward. It is easy to use.
- Log in: Able to see the live prices without the need to log in
- (Tab 1) Home: Shows a summary of how many grams of gold we hold, the current gold prices (buy / sell), snapshot of the 1-month price trend of gold, the SmartSaver plan’s progress, any current news and promos
- (Tab 2) History: Transaction history
- (Tab 3) Rewards: Promo codes and referrals [Check out mine at the end of this post!]
- (Tab 4) Profile: Profile update matters and other settings
Clicking into the “My Gold” section will bring us into a separate page that will detail how much do we have in total with HelloGold. Everytime it hits the milestones 5g, 10g, 20g, 50g, etc… the Gold bar will turn fully into gold and has a showering gold flakes effect per the picture.
Clicking into the “Gold Price Chart” will allow us to see the historical prices based on 1-week, 1-month, 6-month, 1-year, 5-years and 10-years.
Deposit methods
When I first started using this app, there were only 2 options – online banking and Boost. Online banking incurs a processing fee, whilst Boost doesn’t. So I used Boost.
Now though, there are 2 more choices available: GrabPay and TnG e-Wallet. Both e-wallets that I prefer over Boost, so I instantly switched to using GrabPay for my deposits.
Best part, other than not having any processing fee, is that I get points for my GrabPay wallet when I deposit into HelloGold! Strongly encourage to use e-wallets over online banking!
SmartSaver Plan
My favourite part of HelloGold is the SmartSaver Plan. Think of it as an automatic machine that does Dollar Cost Averaging (DCA) for us.
- Pick a goal from the available list (Mine is under “General Saving”)
- Enter an amount between RM30 – RM1,000
- Confirm and it will start with your first month (you can decide to set a direct debit from your bank account if you want, but I didn’t as I wanted to deposit from my e-wallet account)
Once confirmed, the system will split the amount you chose to deposit into the number of weekdays in the month and invest every day at the lowest price on each of those days.
Effectively, we’re doing a daily DCA with this system.
This SmartSaver plan is tracked separately from the main Gold holdings, so we would need to click into this interface to see how it has been performing (as can be seen from my snapshot below).
The fees of HelloGold
No, it is not free to use the platform.
It comes with an admin fee of 2% per annum, which is calculated daily and charged monthly. This will be calculated based on the value of the gold held and deducted directly from the gold account balance.
HelloGold argues that users get to invest in gold at better rates (i.e. spread) on their platform and in return they are charging an annual fees for storage and maintenance of the gold invested.
Let’s do a comparison then:
| HelloGold | Maybank | CIMB | Public Bank | |
|---|---|---|---|---|
| Prices (buy/sell) | 251.2 / 237.2 | 246.9 / 237.7 | 250.4 / 235.8 | 249.2 / 239.6 |
| Spread | 14 | 9.2 | 14.6 | 9.6 |
I’m not sure if the prices will differ when we buy, but based on what I can find online, this doesn’t seem to be the case. Granted, the prices will change during the day so maybe the spread will fluctuate as well.
Banks, as far as I know, do not charge any annual fees as long as you have certain amount of holdings – usually 5g / 10g and above.
What is the effect of the fees on the gold investment? It will shave off a bit of our gold holdings every month regardless of the performance of gold prices – about 0.17% of your total gold value every month. Not significant, but it’s like erosion – slow but it’s there.
By way of calculation, and also assuming that the spread of the other platforms is double of that in HelloGold, it will take roughly 4 years net off fees on HelloGold before the investment becomes worse off than investing directly in the other platforms.
For the math wiz, my rough calculations is as follows:
- 14 * 2 = 28
- 28 spread on current rates = 272 – 216
- Mid point 240 * (1 + 2%) ^ 4 = 260
- 260 +/- 28 = 288 – 232
BTM’s verdict on HelloGold
HelloGold is an innovative introduction to gold investment.
It has introduced a lot of lovely features that I like:
- SmartSaver Plan
- Live gold prices on-the-go
- Invest with as low as RM1 (banks usually have a minimum of 1g, until recently)
The main challenge of continuous use of the HelloGold platform will be its fees. Gold prices are not really on an upward trend like how the SPY index or other ETFs do (check out the 10year prices and you’ll know what I mean). If this is the case, then the 2% admin fee is actually detrimental to the buy-and-hold investment portfolio.
To showcase what I mean: If I buy RM100 worth of gold now and for the next 5 years gold prices stay stagnant at RM100, then the gold value in my account is RM90.40 after 5 years due to the admin fees. My 5-year return has to be at least 10% to breakeven on the fees.
Having said that, HelloGold has the perk of an automatic DCA that will allow us to continuously invest into gold at the lowest price possible. In effect, this will mitigate some of the erosion caused by the admin fee.
At this juncture, I am 50/50 on HelloGold as a long term gold investment platform. It is definitely a good platform for people who want to invest into gold with little capital and likes a convenient app that is user-friendly.
Feel free to share with me your thoughts on HelloGold!
If you haven’t gotten an account yet, I would suggest you open one and try it out yourself!
Referral Code: LOHW8RW8
Remember to use my referral code when you sign up to get RM5 worth of gold when you buy gold worth RM50 within 30 days.
