Why Gold Bought During Diwali Is More Than A Symbol Of Prosperity

With the Diwali celebrations winding down, households across India are now turning their attention from festivities to finances. According to market experts, the gold purchased during Dhanteras and Diwali holds far more potential than simply sitting in a locker. Beyond its emotional and cultural value, gold can play a vital role in strengthening personal finances. From investments and loans to monetisation and leasing, here are expert-recommended ways to make the most of your festive gold this season.

Turning Gold into an Investment Asset

Gold has always been a symbol of wealth and security in Indian households. Experts suggest looking at it as part of a broader financial portfolio rather than just an ornamental possession. While traditional jewellery remains popular, investors can diversify by exploring Gold Exchange Traded Funds (ETFs), sovereign gold bonds, or digital gold platforms. These options eliminate the risks associated with storing physical gold and offer better liquidity and transparency. ETFs, for instance, mirror real-time market prices and can be traded like regular stocks, making them a practical choice for modern investors.

Using Gold to Access Quick Liquidity

Those in need of short-term funds can leverage their gold holdings without selling them. Financial experts note that gold loans are one of the easiest and quickest ways to access liquidity. Banks and non-banking financial companies (NBFCs) provide secured loans against gold jewellery or coins, allowing borrowers to retain ownership while unlocking value. As per Reserve Bank of India (RBI) guidelines, lenders can offer up to 85% of the market value of pledged gold for smaller loans, while larger loans above ₹5 lakh are capped at 75%. The pledged gold remains with the lender until the borrower repays the loan in full, making it a convenient way to meet urgent financial needs without liquidating assets.

Earning Returns Through the Gold Monetisation Scheme

Another option worth exploring is the Gold Monetisation Scheme (GMS), which encourages households to put idle gold to productive use. Introduced by the Government of India, the scheme allows individuals to deposit their gold with authorised centres, where it is tested, refined, and converted into a gold savings account. Experts explain that depositors earn annual interest — generally between 2.25% and 2.5% — and receive a certificate redeemable in either cash or gold once the tenure ends. Currently, short-term deposits ranging from one to three years are available. However, the Medium and Long Term Government Deposit options have been discontinued since March 2025. This scheme is ideal for families who wish to earn modest returns while keeping their gold secure.

Leasing Gold for Passive Income

If selling or depositing gold isn’t your preference, leasing it can be another profitable route. Digital platforms such as SafeGold and similar fintech services enable investors to lease their gold to jewellers as part of their operational requirements. According to financial analysts, this arrangement can generate annual returns between 2% and 5%, often credited in gold grams instead of cash. Unused or old jewellery can be refined into 24-carat gold and digitally recorded in the investor’s account. For those looking for a low-effort, long-term earning method, gold leasing offers an innovative way to turn idle metal into income.

Knowing When to Sell or Redeem

Timing plays a crucial role in getting the best value from gold. Market experts recommend tracking global gold price trends before deciding to sell or convert holdings into funds or ETFs. Since making charges and purity deductions often lower resale value, waiting for a favourable price movement can yield better returns. Monitoring market cycles and consulting with certified jewellers or investment advisors before selling ensures you get a fair deal. Strategic resale can transform festive gold into a powerful financial asset over time.

From Ornament to Opportunity

Gold often finds itself tucked away after the festive season, admired but rarely utilised. According to financial planners, letting gold lie dormant means missing out on potential growth and financial security. Whether you choose to invest, monetise, lease, or pledge it, the key lies in making your gold work for you. With India’s deep cultural attachment to the yellow metal, combining tradition with financial planning can help families turn celebration purchases into long-term prosperity.

Disclaimer: This article is intended for informational purposes only and does not constitute financial advice. The views mentioned are based on insights from market experts and official data sources. Readers are advised to consult certified financial advisors or banking representatives before making any investment or lending decisions.