Jasmine Birtles
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Gold Coins vs ETFs: What’s the Best Way to Invest in 2025?
Ruby Layram
17th Jun 2025
Gold. It’s shiny, it’s ancient, and it never seems to go out of style, especially when markets get a bit wobbly.
But if you’re thinking of jumping on the gold bandwagon in 2025, you’ve got a decision to make: do you go for physical gold coins, or do you invest in a gold ETF and skip the storage?
And here’s something many investors don’t know: buying gold coins from Bullion Club could actually save you money on tax. Yep, HMRC-approved, tax-free gold coins are a thing.
Let’s dig into both options, weigh up the pros and cons, and help you decide what’s right for you.
Why Invest in Gold in 2025?
Before we jump into coins vs ETFs, let’s quickly remind ourselves why gold is still worth considering:
- It holds value over time: Unlike paper currency, gold doesn’t go up in smoke when inflation rises.
- It’s a “safe haven”: When stocks and bonds start acting up, gold often holds steady.
- It’s a diversifier: It’s not tied to the stock market, so it can smooth out your portfolio’s performance.
Gold isn’t going to rocket 10x overnight (this isn’t crypto!), but it is a solid hedge, especially when economic uncertainty is high.
Gold Coins
Now, let’s take a look at Gold Coins vs ETFs to help you make a confident investing decision.
Buying physical gold might sound a bit old school, but it’s becoming increasingly popular, and for good reason.
If you buy UK legal tender coins like Britannias or Sovereigns from a dealer like Bullion Club, you can get some nice tax perks:
Capital Gains Tax-free: UK legal tender gold coins are exempt from Capital Gains Tax (CGT). That means if gold prices rise and you cash in later, you don’t owe HMRC a penny.
VAT-free: Investment gold is also exempt from VAT, so you don’t pay the 20% tax you normally would on a physical product.
You own a real, tangible asset: There’s something reassuring about holding your wealth in your hand, no screens, no systems crashing, no third-party risks.
How to Buy Gold Coins from Bullion Club
- Go to BullionClub.co.uk: Browse their selection of investment-grade gold coins (Britannias, Sovereigns, and more). These are all minted by The Royal Mint and fully UK tax compliant.
- Pick your coins: You can buy in grams or full ounces, whatever suits your budget.
- Create an account: It only takes a few minutes and keeps your orders secure.
- Pay securely: Most dealers accept bank transfers and debit cards. Bullion Club offers insured delivery or secure vault storage if you don’t fancy stashing gold under your bed.
- Store your gold safely: Either keep it at home (preferably in a safe) or let Bullion Club hold it in professional vaults for you.
Important things to consider
Although they are pretty appealing, gold coins aren’t perfect. As lovely and tax-efficient as they are, there are a few things to keep in mind
1. Higher Upfront Costs
Gold coins usually carry a premium over the spot price of gold. That means you’ll pay a bit extra for things like craftsmanship, dealer margins, and packaging, especially if you’re buying from a reputable dealer like Bullion Club.
2. You Need to Store Them Safely
Unlike digital assets, coins need a physical home. Whether it’s a safe in your bedroom or professional vault storage, you’ll need to think about security, insurance, and access. And no, your sock drawer doesn’t count.
3. Prices Can Still Fall
Yes, gold is relatively stable, but it’s not immune to ups and downs. If the economy strengthens, inflation eases, and interest rates stay higher than expected, gold prices could dip. Just like any asset, timing matters.
4. Less Liquid Than ETFs
Selling a gold ETF is as easy as clicking a button. Selling a gold coin? You’ll need to go through a dealer or private buyer. You can still shift them quickly, especially popular coins like Britannias, but it’s not instant cash in the same way.
5. No Interest or Dividends
Gold doesn’t pay you anything while you hold it. So if you’re after income, you might want to look at dividend stocks, bonds, or savings accounts alongside your gold.
Gold ETFs
If storing shiny coins isn’t your thing, gold ETFs let you invest in gold via the stock market, no safe required.
A gold ETF (like iShares Physical Gold ETC or Invesco Physical Gold ETC) tracks the price of gold and is backed by physical bullion held in vaults.
You don’t own the gold directly, you own shares that represent gold, but it’s incredibly easy to buy, sell and hold.
Benefits of Gold ETFs:
- Convenient: You can buy them through any investment platform like Hargreaves Lansdown, XTB, or Invest Engine.
- No storage faff: No safes, no vaults, no insurance worries.
- Low minimum investment: You can invest from as little as £10.
- Good for ISAs & SIPPs: Many gold ETFs are eligible for tax-free accounts.
Things to consider before you invest
- Capital gains tax applies: If your ETF rises in value and you sell it, you might owe tax if you’re not using an ISA or staying under your CGT allowance.
- You don’t physically own gold: You’re relying on a fund manager and third-party storage.
How to Invest in Gold ETFs
- Choose an investing platform: Look at popular options such as eToro, Trading 212, Hargreaves Lansdown and Invest Engine.
- Search for a gold ETF: Try “SGLN” (iShares Physical Gold ETC) or “SGLP” (WisdomTree Physical Gold).
- Invest the amount you want: Most platforms let you invest fractionally, so no need to invest hundreds at once.
- Hold it in an ISA if you can: That way, any profits you make are free from CGT.
See: The best stocks and shares ISAs for UK investors
What’s the Outlook for Gold Prices in 2025?
If you’re thinking about investing in gold, whether that’s coins, ETFs, or both, it’s only natural to ask: Is now a good time?
Well, here’s what the experts are saying about gold in 2025…
Central Banks Are Still Buying
Central banks across the globe, especially in countries like China, India, and Russia, have been buying up gold in record amounts. Why? They want to diversify away from the US dollar and protect against inflation and political risk.
This continued demand is likely to keep gold prices supported throughout 2025.
Rate Cuts Could Push Prices Up
With inflation starting to cool and many central banks (including the Fed and possibly the Bank of England) expected to cut interest rates this year, gold could get another boost.
Lower rates mean lower returns from cash and bonds, making gold look more attractive by comparison.
Analyst Predictions
While no one can predict prices perfectly, several analysts are forecasting gold to remain strong:
Some see gold hitting $3700 (which is about £2,735.56) per ounce in 2025.
Others are even more bullish, expecting new all-time highs if rate cuts happen faster than expected.
Final Thoughts
When it comes to choosing the best way to buy gold, consider factors such as price, tax benefits and convenience.
Gold coins come with excellent tax advantages that make them an appealing option for long-term investors. Plus, it might be nice to have something shiny that you can physically hold in your hand!
On the other hand, ETFs are more liquid (easier to buy/sell) and can be stored in your investment account- no worrying about buying a safe!
If you fancy adding gold coins to your portfolio, I recommend checking out Bullion Club. They are a reputable brokerage that will guide you through the entire process, so that you know you’re getting the best!
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Disclaimer: MoneyMagpie is not a licensed financial advisor and therefore information found here including opinions, commentary, suggestions or strategies are for informational, entertainment or educational purposes only. This should not be considered as financial advice. Anyone thinking of investing should conduct their own due diligence. Companies listed above are not necessarily endorsed by Money Magpie. When investing your capital is at risk.
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