Adiba Ahmed, whose family immigrated to Canada from Bangladesh, wears jewellery that was gifted to her, in Hamilton, on May 25.Lipa Islam/The Globe and Mail
As a child, Adiba Ahmed didn’t understand why her mother loved gold jewellery. But when her family came under financial stress and her mother sold the gold to keep them afloat, Ms. Ahmed realized that gold jewellery could be a reliable emergency fund.
Gifting gold jewellery on special occasions is a prominent tradition in many South Asian countries, including Bangladesh, from where Ms. Ahmed’s family moved to Canada. Other countries where gold gifting is popular include Pakistan and India.
According to a 2023 report by the World Gold Council, Indian households own approximately 25,000 tonnes of gold, or roughly 12 per cent of all the gold that’s been mined globally.
Women in India often receive gold jewellery during weddings, births and festivals. According to the World Gold Council, roughly 50 per cent of India’s gold jewellery demand is at weddings.
These gold ornaments are a form of financial independence, says Satwinder Kaur Bains, director of the South Asian Studies Institute at the University of the Fraser Valley.
“It was something that was seen as sacred for the young bride as she left her family’s home. She took with her an asset that could be converted into a different type of currency if she was in crisis,” she said.
Gold chains displayed at VJ Gold and Diamond jewellery shop in Kuala Lumpur, Malaysia.LIM HUEY TENG/Reuters
The metal’s value as a financial asset has been underscored in recent weeks as a variety of factors – from the possibility of interest-rate cuts to concerns over geopolitical tensions – have driven gold prices to new heights. Bullion hit a record high of US$2,449.89 an ounce on May 20, an encouraging sign for investors and resellers alike.
Indeed, Aaron McDermand, the owner of Aaron Buys Gold, two Edmonton-based gold stores, says he has seen a significant increase in the number of people selling their gold jewellery and a decrease in its purchase. He says he has purchased a lot of South Asian and Middle Eastern gold from his clients.
Ms. Ahmed was in high school when her grandmother in Bangladesh needed money for medical expenses. In Canada, her family was struggling financially as well; her mother was on disability benefits and could not work. Her mother sold the gold jewellery she had accumulated over the years to make ends meet. “It helped pay for two months of rent,” she said. “In my head, I [thought] it [was] just aesthetics. But it went from aesthetics to asset accumulation, which is a whole different life.”
This experience taught her the importance of asset accumulation – building wealth over time through savings and investments – and became her reason to pursue a career as a financial activist and content creator. As an owner of Phoenix Consulting in Hamilton, she speaks at financial engagements and conducts workshops.
Members of the South Asian diaspora may prefer investing in gold jewellery over stocks because it is more common in their home country.
Ms. Ahmed says children may not realize the full value of their gold necklaces and bangles because parents do not have conversations on how to invest.
A participant shows gold bars during the 21st edition of the international gold and jewellery exhibition at the Kuwait International Fairgrounds in Kuwait City, on May 23.YASSER AL ZAYYAT/Getty Images
Parween Mander is a Vancouver money coach who offers financial advice to clients but does not manage investment portfolios.
She says her clients, especially first-generation Canadians, can feel guilty when they make financial decisions stemming from a lack of financial literacy.
“I think because our culture hasn’t necessarily talked a lot about financial literacy,” she said. “For us growing up, there’s this perception of, ‘Hey, I’m supposed to have it all together financially. But no one’s taught me the steps on how to do that.’ ”
According to Prof. Bains, women saved the gold they received to pass it on to future generations. It was a way to create generational wealth and an heirloom from previous generations.
Women get attached to gold that is passed down from their parents or grandparents, she said, so it can be harder to part with it.
Ms. Mander says she sees it in her clients, “I find that typically if it’s generational gold, there’s a little more hesitancy to sell it off just because of the emotional value.”
While the tradition of passing gold ornaments is still prevalent in older South Asian women in Canada, the younger generation is more likely to explore more profitable ways of wealth accumulation, Prof. Bains says. Instead, they prefer to buy gold bars, stocks or real estate rather than gold.
Women visit a stand during the 21st edition of the international gold and jewellery exhibition in Kuwait City, on May 23.YASSER AL-ZAYYAT/Getty Images
As a young, first-generation Indian-Canadian, Ms. Mander says her relationship with gold jewellery is very different from her mother’s. She prefers to diversify her investment portfolio and buy gold bullion. Most of her gold jewellery was gifted to her as a child or at her wedding.
During her wedding in 2022, Ms. Mander wanted to buy gold bars instead of the traditional gold sets, but she said her mother was set on purchasing jewellery.
Similarly, Ms. Ahmed says gold jewellery is profitable mainly when gifted.
“If you are passing it on to like a family member, even like a 20- to 22-carat can do well,” she said, “It’s always 100-per-cent profit.”
But for her, buying gold jewellery is less of an investment than bullion because it can be traded at Canadian banks. Jewellery must be sold to gold resellers. Many things, including its purity, can affect its price. In South Asian countries, buying 22- or 24-carat gold is more accessible, but in Canada, 14- and 18-carat jewellery is more common.
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