With so many investments heading south these days, maybe you should consider converting your money into gold. Gold has always had a reputation as a "safe haven" and even countries back their currencies with gold reserves.

LAST YEAR, I WAS ROLLING MY EYES at those who put their money in fixed deposits and savings accounts earning less than two per cent returns. The property market was booming then, as were the stock and commodity markets. Why were they not adventurous? I cut out articles and advertisements to encourage friends and family members to take bigger risks and earn more.

It's just as well that I have no persuasive powers. With recent financial debacles to do with Lehman's Minibonds, I have learnt to shut up. So, when my mother asked me recently for investment advice, I was naturally at a loss for words. Where does one put their life savings these days? We cannot go back to the days when people stashed cash under their mattress or buried wrapped wads of dollars in rice bins.

In my hunt for safer havens, gold comes up as an option. It's always been a popular Asian way of "saving" for the future, which I think may be worth considering today. The Asian way of sending a daughter off to her marital home with gifts of gold jewellery and making gifts of gold to a newborn, stem from the concept that gold is a liquid asset that can be converted into cash when you need it. It remains till today one of the more liquid assets that most people can buy and hold.

Growing up, I remember how my family used to pawn my mother's gold jewellery for extra cash to get us through difficult months. When we had some cash on hand, remember going with mother to redeem jewellery.

Gold is still a much sought after investment, especially with demand looking as if it can only go up. Almost all of the demand for gold jewellery is fuelled by just 10 countries worldwide with India, the US and China taking the top three spots in that order.

Never invest what you cannot afford to lose and I believe in putting my investments in different baskets. During the financial turmoil that we are all gasping from now is largely due to greed. Too many people were living beyond their means.

Anyone wanting to invest is to diversify their investments and to diversify well.

Diversify: If you have only $X to invest; make sure you put them in several baskets. That way, even if one falls flat, you're not out in the streets straight away with your begging bowl.

Diversify well: Try to look for investments that are very different or better still that will move in opposite directions. If you think the property market is going to boom, don't just keep buying property stocks. If the whole market collapses, you lose everything.

But there are risks with gold as with any investment, there are no guarantees that gold prices will only go upwards. There are many factors that affect the performance of gold in the market.

Besides inflation and the rise and fall of the US$, you also have to look at things like geographical tension that have an effect on the supply and demand of gold.

That's the part I am having difficulty with. How do I explain this to someone like my mother?

There are three ways to participate legally in the gold market, which is still considered a safer (but not risk-free investment). These are to buy gold in the form of jewellery, buy physical gold in the form of gold bars and coins and buy exchange-traded gold shares.

Gold jewellery: Of course, having gold and wearing it is great, but do bear in mind that gold jewellery incurs a Tax and something called a "making charge" which is the labour cost. This makes it an expensive investment from the word 'go". Still, gold jewellery is even now considered a liquid asset because you can get cold hard cash for it at the pawnshop. But wearing a lot of gold, especially for the old and very young, can draw unwelcome attention, so other than for special occasions, do keep the glitter out of sight.

Gold bars and coins: These do not have aesthetic value because they cannot be worn as jewellery. But, they too still incur a "making charge" and the Tax. Pawnshops pay a good price for them, however. Collect these only if you've thought about safe storage.

Gold shares: This is the more modern way of investing in the gold market. You can go to a broker, open an account and buy gold shares without worrying about theft.