Gold vs. Stocks and Bonds for Retirees

If you are close to retirement or already retired, you have probably heard strong opinions about gold. Some people say it is the only safe place for savings. Others say it is a dead asset that pays nothing.

The long-term record is more useful than either opinion. This page compares US stocks, US government bonds and gold using one well-known public dataset, with exact years for every number. It shows where each one did well, where each one let people down, and why most retirement plans hold some of each in different amounts.

All the return figures below come from the historical returns dataset kept by Aswath Damodaran, a finance professor at NYU Stern, last updated January 5, 2026. "Stocks" means the S&P 500 with dividends reinvested. "Bonds" means the 10-year US Treasury bond, including its interest. "Gold" means the change in the gold price. These are calendar-year results, before taxes and fees, and not adjusted for inflation.

Gold, stocks and bonds at a glance

The yearly growth figures are our calculation from Damodaran's year-end values (the compound annual rate that turns the starting value into the ending one). The 2008 and 2022 rows are his annual returns, rounded. Past performance does not guarantee future results.

Which has done better over the long run: gold or the S&P 500?

US stocks, by a wide margin, over long periods. But gold has beaten stocks in some shorter stretches, and the gap depends a lot on which years you pick.

From the start of 1928 to the end of 2025, $100 in the S&P 500 with dividends reinvested grew to about $1.16 million in Damodaran's data. The same $100 in gold grew to about $21,000. In 10-year Treasury bonds it grew to about $7,750.

The starting year matters for gold. For decades the US dollar was tied to gold at a fixed price. Under the system that ran until 1971, dollars could be exchanged for gold at $35 an ounce, according to the Federal Reserve's history of that period. In August 1971, President Nixon closed that "gold window." Because the price was held steady for so long, gold barely moved in many years before 1971. In Damodaran's data, gold's return was exactly 0% every year from 1941 through 1948.

That is why the table also shows 1972 to 2025, after the price was free to move. Over those years gold grew about 8.9% a year, stocks about 11.1% and 10-year Treasuries about 5.9%. Gold looks much better over that window, but it still trailed stocks.

What happened to gold, stocks and bonds in 2008?

Stocks fell hard, while Treasury bonds and gold both rose.

In 2008, the year of the financial crisis, the S&P 500 lost 36.55% including dividends. The 10-year Treasury bond gained 20.10%. Gold gained 4.32%. Lower-rated corporate bonds (Baa grade) lost 3.44%, so not every kind of bond held up.

For someone retiring that year, this was the moment that mattered. A retiree with only stocks who had to sell to pay the bills was selling at low prices. A retiree with some Treasury bonds and cash could spend those instead and give stocks time to recover. In this data, a dollar in the S&P 500 at the end of 2007 did not finish a year above that level again until the end of 2012.

Our guide on protecting your 401(k) from a market crash near retirement explains this risk, and the "bucket" approach many retirees use for it.

What happened in 2022, when stocks and bonds fell together?

In 2022, stocks and bonds both dropped, and gold was roughly flat.

The S&P 500 lost 18.04% including dividends. The 10-year Treasury bond lost 17.83%, mainly because interest rates rose quickly, which pushes down the price of existing bonds. Baa corporate bonds lost 15.23%. Gold gained 0.55%.

This is the main argument people make for holding a small amount of gold. In a year like 2022, the usual cushion (bonds) did not cushion. Gold didn't make money, but it didn't fall with everything else.

One year is not a rule, though. Gold has not always helped in bad years for stocks. In 2001, when the S&P 500 lost 11.85%, gold gained only 0.75%. In 1981, when stocks lost 4.70%, gold lost 32.60%.

What can't gold do?

Gold can't pay you an income, and it can go many years without gaining.

• No income. Gold coins and bars pay no interest and no dividends. To spend money from gold, you have to sell some, even in a year when the price is down.
• Long flat stretches. Using Damodaran's year-end figures, gold ended 1980 at a level it did not finish a year above again until 2006, about 26 years later. After falling 27.61% in 2013, gold did not finish a year above its end-of-2012 level until 2020.
• Big swings both ways. Gold rose 126.55% in 1979, then fell 32.60% in 1981. It rose 66.22% in 2025. Large gains have been followed by large drops before.
• Costs to hold. Physical gold needs storage and insurance. In a gold IRA you also pay a custodian every year. See our gold IRA fees guide for how these add up.

None of this makes gold useless. It means gold works best as a small supporting piece, not as the plan itself.

Do stocks, bonds and gold pay income in retirement?

Bonds pay interest and many stocks pay dividends. Gold pays nothing.

This matters more in retirement than while you are working. When you are living on your savings, income that arrives on its own (interest, dividends, Social Security, a pension) means you sell less of your investments to pay the bills. That is especially helpful in years when prices are down.

• Bonds pay interest on a set schedule. Treasury bonds are backed by the US government. Their price can still fall when interest rates rise, as 2022 showed.
• Stocks can pay dividends, and the S&P 500 figures above include them. Companies can cut dividends in hard times.
• Gold pays no income at all. Its whole return is the price change.

Our guide to investments that pay monthly income in retirement covers the income side in more detail.

Is gold a good hedge against inflation?

Sometimes, over certain periods, but not reliably year to year.

Gold did very well in the high-inflation 1970s. In Damodaran's data it rose 72.96% in 1973, 66.15% in 1974 and 126.55% in 1979. But it then fell in many years of the 1980s and 1990s while the cost of living kept rising, which is how it ended up below its 1980 level for so long.

Gold is not the only tool here. There are bonds built for inflation, such as Treasury Inflation-Protected Securities (TIPS) and I bonds. Our page on protecting retirement savings from inflation compares these options side by side.

Why do most retirement plans hold all three?

Because each one tends to do well at different times, and a mix gives a smoother ride than any single asset.

The SEC's investor education office explains it this way: historically, the major asset categories "have not moved up and down at the same time." When one falls, another may hold steady or rise. You can see that in the data above. Bonds cushioned stocks in 2008. Gold held steady in 2022 when bonds didn't.

The SEC also notes that most people investing for retirement hold less stock and more bonds and cash as they get closer to retirement age. Precious metals are listed as one of the "other asset categories" some investors add, with their own specific risks.

In practice, many retirement plans use stocks for long-term growth, bonds and cash for income and stability, and, for some people, a small share of gold as extra protection against unusual years. How much is a personal decision. Our guide on how much of your retirement portfolio should be in gold looks at the common ranges and where they come from.

Which fits you?

There is no single right answer, but some situations point in clear directions. These are patterns, not personal advice.

Stocks may carry more weight for you if:

• You have 10 or more years before you need most of the money.
• You can leave your investments alone through a drop of 30% or more without selling.
• You have other income (Social Security, a pension, bonds or cash) to live on during a bad year.

Bonds and cash may carry more weight for you if:

• You are already retired or will be within a few years.
• You need steady income from your savings.
• A big drop in your balance would force you to sell or would keep you up at night.

A small share of gold may make sense to look at if:

• You already have a solid base of stocks, bonds and cash.
• You want something that has sometimes held up when both stocks and bonds fell, as in 2022.
• You are comfortable owning something that pays no income and may go many years without gains.

Gold is probably a poor fit if:

• You need your savings to produce income now.
• You would be putting in money you may need within a few years.
• Someone is urging you to move most or all of your savings into metals. That is a warning sign, not a plan.

If you are weighing changes to your retirement mix, people in this situation often talk to a fee-only fiduciary, who is paid by you rather than by commissions on what you buy. If you decide gold has a place, our page comparing a gold IRA with buying physical gold explains the two main ways to own it, and is a gold IRA a good idea? covers the trade-offs.