Tips for storing gold

This post comes from Brian O'Connell at partner site MainStreet.

Gold is trading up once again today -- closing in on $1,900 per ounce.

There’s no guarantee that the precious yellow metal will keep rising in value, but one thing's for sure: If Americans continue to believe that the economy is floundering, gold will be in high demand.

"Gold bugs" flock to the metal because historically it's proven to be a good hedge against a weak dollar, high inflation, and a recessionary (or worse) economy.

But if you buy gold -- and we featured a tutorial on that -- then in some cases you'll have to store it yourself. That's the deal when you buy physical gold like bullion, bars and coins. Some banks and private depositors will be glad to handle that task for you, or you can elect to keep it yourself, in a home safe or other (hopefully) secure location.

What's your best option for storing gold? Here is what to expect from the two main choices:

Store it yourself. It's a bit of a risk to store gold yourself, even in a safe in your own home. Yes, you'll save on gold storage fees, which have been rising lately as gold is in higher demand. (Banks and private storage outfits usually charge up to 1.5% of your gold's value to store it for you, or a flat fee for basic storage boxes.)

But you're also at a higher risk of theft, as most homes aren't as secure as a Brinks or a Bank of America vault.

On the plus side, your gold will be easier to access at home, and if things really go downhill economically, having gold on hand should make it easier for owners to use it as currency (its "last resort" use) to buy food, fuel and water.

You can insure your self-storage of gold, but expect to pay sharply higher premiums than if you were storing gold at a bank or private security firm. You'll also pay for shipping and handling, insurance for shipping and handling, and for appraisal costs when you attempt to sell the gold on your own to a reputable dealer. Post continues after video.

Store gold with a bank or private firm. At the ground-floor level, you can get away with paying $100 or $200 per year for a simple storage box. If you're worried that a safe deposit box isn't secure enough, you can pay more for a private firm to lock it away in a more secure location, such as a bank vault or other hard-to-access location.

But banks and private security companies aren't open 24 hours a day, so if there's a big run on gold in overseas markets, or if you feel the need to close an after-hours deal right away, you can't get access to your booty.

Also, note that banks don't insure safe deposit boxes, so you'll have to buy separate insurance on your own. The good news here is that it won't be as pricey as an insurance policy covering gold stored in your own home.

There is a difference between storing gold with a bank or with a private company. With a private security firm, you own the gold -- a system known as "allocated storage" -- and retain legal title to the gold. But if you store with a bank -- known as "unallocated storage" -- you only own the paper value of the gold, making you in effect an unsecured creditor of the bank -- and thus dependent on its creditworthiness.

Storing gold is serious business, and should be treated as such. Examine the facts, weigh your options, then act on the safest location that meets your gold storage needs.

More on MainStreet and MSN Money:

• How to get in on the gold rush
• 10 careers where graduate school is worth it
• Buying is cheaper than renting in most US cities
• Why gold could hit $5,000
• Gold catapults to new high
• Today's best savings rates