You must be looking to diversify your investment portfolio. In which case, smart move.
While the astute investor will know that holding all your eggs in the same basket is a terrible idea, having some gold coins in your portfolio will make for a more robust investing strategy.
And there’s nothing quite like holding gold in your hand, knowing it is the metal that shaped civilizations and influenced our entire human kind’s destiny. That is the money that everyone speaks.
I found a plethora of helpful information when researching this topic for myself, but it can sometimes be too dense for people who are only looking for a quick answer.
This is why I decided to put together this guide on where to buy gold coins that a toddler should easily digest.
Where Should You Look For Gold Coins?
Investing in gold has turned profitable for entire generations throughout history, but owning physical gold should not be regarded as an investment, per se.
Instead, the way you should look at gold is as a store of value. It is a commodity that ensures your money against inflation and other situations of economic turmoil.
Since gold is not tied to any nation’s currency, it tends to retain its value even when fiat currencies lose theirs. As a result, it has outlived any other currency.
And gold coins are a practical way to trade this precious metal that can be bought and sold throughout the world.
Reasons Why Gold Is A Smart Investment
There are many reasons why buying and holding gold is a fantastic way to diversify your portfolio. Here are some of the main benefits of owning units of this precious metal:
- Gold does not require any bank or government backing, which makes it free of any counterparty risk. So the gold you own is never going to be anyone else’s liability.
- Gold is highly liquid. Any gold you own can be sold anywhere in the world, and there is always going to be a market for it. Moreover, in times of crisis, when you might need the value of your gold stores, it will be in high demand, increasing its price.
- The amount of gold you own is entirely confidential. Most countries will require you to pay taxes on any gains, but the gold you own is one of the most private assets you could hold.
- Gold is very storable and value-dense. You can hold $100,000 of gold coins in a drawer. This is extremely valuable when you need to quickly move value or need a large amount of money in a pinch.
There are many other reasons for you to take this step. Gold cannot be destroyed by fire, water, or time. It is a highly comfortable asset that does not need maintenance and not only holds its value but appreciates in time.
How To Choose A Gold Coin
Gold comes in a broad range of aspects. Whether you’re looking at vintage gold coins or bullion gold coins that were made specifically for investors, there’s a chance you will be overwhelmed by the broad range of weights, sizes, and even purity levels.
The complex selection of gold coins available on the market ensures affordability for just about anyone. Most bullion coins are minted at .999 or .9999 fineness, though some use the 22K gold purity.
Here are the available sizes in which modern bullion coins are usually minted and sold:
- 1/25th ounce
- 1/20th ounce
- 1/10th ounce
- ¼ ounce
- ½ ounce
- 1 ounce
Apart from their standardized weight and purity, there are a couple of categories in which you will be able to place most gold coins.
1. Bullion Coins
These are the coins that are made almost exclusively out of gold. Their standardized high purity attracts most investors, and they are sold at the regular price of gold since they are not viewed as collector items.
Some bullion coins will have a type of alloy that makes them more durable since gold is a somewhat soft metal.
2. Numismatic Coins
Numismatic refers to the coins sold as collector items. They might be vintage or rare coins, but their gold weight or purity percentage does not give their value. Instead, their rarity and condition are what drives their prices up into the thousands of dollars, or even millions.
There are several reputable providers of collector’s coins, but it is a safe practice to thoroughly research them before buying.
Another form of numismatic is a proof coin. These are intricately made high relief coins that are sought after for their aesthetic proprieties, and they’re also geared towards gold collectors.
Semi-numismatics are regular gold coins made to be collector’s items by simulating vintage coins without having their historic properties. They will be more expensive than standard bullion coins, but their value will be only decided by the collector’s market.
Legal Requirements Of Buying Gold Coins
A lot of investments need serious paperwork and a lot of verifications before you can utilize your asset. For example, buying real estate can take weeks, if not months, from start to finish.
Buying stock or cryptocurrencies can sometimes turn out pretty heady, and you will probably have to wait for your identity to be confirmed.
Buying gold takes the same amount of time as buying a book. You will probably need a government-issued ID to complete the purchase, but you can walk in and out of a gold dealer in a few minutes.
You can buy it in cash, with any cards, check or even cryptocurrencies, and selling them is just as easy.
The Best Places To Buy Coins
The vast majority of gold coins are either bought online or in physical coin shops. While there are other ways to trade coins, these two are some of the easiest and quickest methods.
1. Local Coin Dealer
This is a great option when you want to take immediate possession of your coins. You will not be charged any shipping or insurance fees, and your transaction benefits from the highest level of privacy.
Even if you want to buy your coins online, checking out local coin dealers first could prove useful, as you might want to establish a relationship with them. This can prove helpful if you’d like to sell your coins quickly.
2. Online Dealers
One advantage of online dealers is their lower prices. Even if you have to wait for your product to be shipped, most reputable online dealers offer speedy deliveries and the possibility to return it if it does raise to your standards.
Reputable online dealers hold their stock to great standards, and buying from an established provider will ensure the quality of your coins. However, you should steer away from small-time online shops.
You should always check Trustpilot for reviews and choose providers with stellar reputations.
The main thing differentiating both of these methods is their selection of products. Local dealers might have a more limited choice, which you will see and hold for yourself. On the other end, the selection will most likely be more extensive if you’re looking to buy online, but you will have to pay upfront and won’t see your physical product until it arrives.
Other Places To Buy Coins
A lot of other coins are sold through various means, and each of them comes with series of advantages and disadvantages.
3. TV Dealers
Cable television is ridden with advertisements for gold coins from different dealers. While they might package their products in sly marketing techniques, it’s almost always best to avoid buying gold through this method.
A lot of them will try to talk you into buying numismatic coins or try to sell you more than you wanted through minimum buying limits or steep prices for purchasing a small lot.
Moreover, the price of these coins is usually a lot higher due to the dealer’s investment in advertising or endorsements.
Buying gold from eBay is yet another convenient method to acquire gold privately. There are a lot of great sellers on eBay, and shipping is usually free. Buying from a private seller gives you broad access to the collector’s market, as well.
However, you will have to be knowledgeable about coins and exercise caution since eBay cannot guarantee for private sellers.
And private sellers will not beat dealers’ prices by much since premium fees on standardized bouillons are generally low.
Another easy way to swap cash for gold or vice-versa would be peer-to-peer transactions. But you should also be reasonably knowledgeable about coins and their properties, as well as their usual prices, so you avoid the risk of getting scammed.
The best way of staying safe when buying gold is sticking to a reputable gold dealer. These will only sell high-quality products that come from authorized distributors of the governments’ mints.
Try to stick with bullion coins for investments unless you plan to become a collector. In that case, you will have to do your due diligence in documenting coins and assessing their value.
This skill can take a lot of time to master, and already skilled brokers will usually charge very steep premiums.
Ultimately, keeping your business to one or two highly regarded dealers will save you a lot of time and money, and the fees are insignificant compared to potential rip-offs that you could experience.
If you’ve got any questions about your first steps into gold ownership, leave me a comment below, and I’ll do my best to shed some light on it.