Throughout history, people have invested in gold coins to protect their wealth and diversify their assets. Some people even purchase gold coins just as a hobby, but gold is generally and widely used for trading or hedging against riskier financial securities. The most common and efficient form of trading gold is gold coins. They are considered legal tender, easier to trade, and harder to forge than other forms of this metal. The fact that the price of gold has historically been stable makes it a reliable item in which to store a part of your wealth.
Using gold coins to trade or to save is not exceptionally difficult but does require some knowledge. And only a well planned investment in gold will get you good results. So a common question is, how do I buy gold coins? Our quick guide on how to buy gold coins will help you understand the basics and get you started on increasing your financial security.
Gold coin investment has been popular for a very long time, because gold has historically been a stable investment relative to other investment vehicles such as stocks which have been more volatile, resulting in heavy losses by some investors. In addition, you will not have to pay any kind of tax while you hang on to the coins, and tax will only be applied when you resell it. So instead of keeping all of your assets in paper currency, you can buy gold coins and diversify your risk.
Coins to Avoid as Beginners
The first thing to be aware of when you're purchasing is that the market has a variety of ‘collector’s coins’, and these aren’t exactly the best gold coins to buy for beginners. These gold coins can include antique coins, rare coins, etc. These coins may look very similar, but they could be completely different according to grades which could result in differences of thousands of dollars, which makes them difficult purchases for beginners. They also generally have poor liquidity, so if your purpose for purchasing gold coins is solely for trading or saving, then do not start with unique coins.
Best Way to Buy Gold Coins
The best way to buy coins for beginners is via a local dealer or a financial institution. Do a little research on the dealer you are considering before you purchase the gold coins and compare the prices of several dealers’ products. The two basic things that you should first look for in a dealer are reputation and experience. Gold prices quoted by local dealers are generally higher than spot prices you’ll find online. This is quite common and is almost always the case. Be aware that you will be paying a higher price with local dealers. Compare prices of local dealers and see the range of local prices in your market area.
Best Gold Coins to Buy
One of the best ones to buy currently are the American Eagle coins. The American Bullion is said to become rarer in the coming years, and bullion coins are nice for beginners due to their liquidity. However, according to some experts, all of the American Eagle gold coins other than the 1 ounce coin carry higher premiums above spot prices and this is how dealers make profit. So buyers should focus on purchasing the 1-ounce gold coin of American Eagle, as fractional coins are never a good investment. You can get American Eagle coins with confidence at Money Metals Exchange, which is known to be one of the most trusted online gold retailers as one that offers the lowest prices.
If you are planning to purchase gold coins from an individual or any unauthorized source, which isn’t exactly the best way to buy gold coins, make sure you get the gold checked and verified to avoid fraud. Be aware that those who give good advice on how to buy gold coins or about gold coin investing in general may not always be the best sources or dealers from whom you’d want to make purchases. Buying from unauthorized gold coin sellers is high risk, and we’d recommend that you avoid these types of risks. There are enough risks in the market you take as investors. You don’t need to add unnecessary risk to your financial investments! So remember, the cheapest place to buy gold coins may not be the best.
After Your Purchase
After purchasing gold coins, we would highly recommend you do not store your gold coins in your own home. Safe deposit boxes are our top choice for storage, but if you must store them in your home, use a good safe. Even if you hide your coins really well, remember that thieves with good metal detectors can find them rather easily.
Buying gold coins has been a historically stable investment . It helps you diversify your risk and hedge against other assets. Gold can help you build a stronger foundation of diversified assets that can withstand historic crashes in other markets.
If you feel that you need some guidance to orient you as you're starting out in this form of investment. you may want to check out Minesh Bhindi's webinar which makes for an excellent introduction to precious metals investments. You'll get a good grasp on the basic principles as well as some tried and true investment techniques which have been known to result in solid returns.