1. Gold has historically been and is also currently the most respected and sought after precious metal. Since the first discovery of gold it has been a desired possession by many and its desire among people from all over the world has continued to grow.
2. Gold is not affected by inflation and in fact can protect you from inflation. The value of gold remains stable allowing you to purchase gold with today’s dollar and sell it with tomorrow’s currency and recoup the changes. Gold is unlike other purchasing items where the value of the item depreciates because of inflation eating away at the value of the currency.
3. Gold also retains its intrinsic value. History has proven that the demand for this metal has never stopped and continues to grow. You would be able to sell your gold even during a domestic or international crisis. Governments and people all over the world are drawn towards this glamorous yellow metal, making it the only “true” international currency. Gold will never lose its value no matter where it is located.
4. You can take physical ownership of gold making it one of the safest investments ever. If there were a market crash or electronic blackout, all of your investments would be gone because all they are just numbers in a computer. Physical gold on the other hand, can be kept safely in your possession during a crisis, giving you financial security at all times.
5. The scarcity of gold, with more than 80% of the gold supply is not accessible to buyers. More than half of its supply is made of jewelry, around 16% is in government reserves, 12% is in dental implants, and 2% is unaccounted for or missing.
One of the most popular ways that people participate in gold market is through purchasing bullion bars. Bullion bars come in a variety of sizes such as the 1oz, 10oz, 1 kilogram, and 12 kilograms. The level of purity varies from 22 karats to 24 karats. The price of the coin or bar is determined by its metal content.
Another popular way to invest in gold is through bullion coins. Just like bars, bullion coins receive their value based on the weight of their metal content. These coins are made to an exact standard, and there are several bullion coins produced by government mints throughout the world. Some other popular bullion coins that are known for being very reliable and easy to obtain are the American Eagle, American Buffalo, and the Canadian Maple Leaf.
If you are new to precious metals and are starting to build an investment portfolio for the first time silver is a very practical choice especially because it is more affordable than gold. Although gold and silver did increase by the same margins over the last 10 to 20 years it is fair to say that gold’s nominal value is a lot higher than silvers. Since gold has a high intrinsic value it can be quite costly for many folks and sometimes even for those who do invest in gold it’s not always what would be considered a substantial investment. Silver makes a great investment for both novices and seasoned investors but especially for those who are looking for an affordable investment option.
Before choosing silver bars or coins it is best to consider first what each of them can offer. If we consider space, bars are going to take up more space than coins. Another thing to consider is that premiums will be different among bars and coins. Bullion bars are going to carry a lower premium and silver coins.
Silver Coins: Silver coins are produced at government mints from around the world. Silver bullion coins are widely recognized and therefore highly liquid, meaning they are easy to buy, sell, and trade. While silver coins carry a higher premium over the spot price of silver than silver bars or rounds.
Silver Bars: silver bullion bars are a way to purchase silver in pure physical form that can be easily stored and stacked in a safe. It is recommended to those new to investing in silver to narrow your choices and keep it simple. The most popular sized bars from investors include the 1oz, 5oz, 10oz, 1 kilogram, and 100 troy ounce bars.
Investing in Pre-1933 US Gold Coins
Numismatic is the study of coins, paper money, tokens, and medals. Numismatics is known as the “Hobby of Kings,” which not only can be an enjoyable hobby but a profitable investment as well. Numismatic value is the value of the item that exceeds that of the base monetary value given by the market, also known as “collector’s value.” Collector’s value is rather significant especially when investing in rare gold and silver coins.
Rare or scarce (often called better dated) coins are coins that have value above just their metal content which gives them a few benefits that bullion coins do not offer, here are the three most popular:
Rare gold coins offer the advantage of increased profit potential over gold bullion coins and bars due to their quality and scarcity. Whereas literally millions of new gold bullion coins and bars are minted and manufactured each year, no one is making any new rare coins! The most common rare gold coins have surviving populations in the thousands, as opposed to the tens of millions of gold bullion coins which exist on the market.
Rare gold coins also offer enhanced protection against government restrictions on private gold ownership. In 1933, the President put forth an executive order to confiscate privately owned gold and outlaw the private ownership of gold. However, the order specifically exempted rare coins from confiscation.
Many who value their privacy also acquire US rare coins due to their status as a collectible that allows purchase and sale of them without 1099-B reporting to the IRS by the coin broker/dealer. These transactions are confidential.
During the last gold confiscation in 1933 under Franklin D. Roosevelt, gold bullion was confiscated by the federal government but rare coins were not. As collectibles, rare gold coins do not fall within the provisions allowing confiscation and in fact are specifically exempted by language in the executive order (click here to read the executive order). Many experts believe that future confiscation of gold bullion is a likely possibility, and that rare or unusual coins will be again excluded.