How to Buy Gold and Silver the Easy Way
Win the fight against inflation by learning how to buy physical gold and silver the easy way.
This is not investment advice.
Inflation is at an all-time high and gold and silver (particularly gold) has historically been a successful tool in protecting people against it. Gold/silver protects people’s savings by typically rising in value as the purchasing power of money drops due to inflation. Note, that gold and silver will not make a person rich. It’s typically treated as a long-term defensive play against inflation, which also happens to be fun hobby that teaches important wealth building skills. Furthermore, most people know that diversifying their assets is a key to building wealth but don’t know how to diversify or how to buy gold/silver. You can diversify your assets by buying gold and silver using the four simple steps below.
Four Steps
First, select a fixed amount you are willing to spend every time you get your paycheck on gold and silver so that you can dollar cost average (see below).
Second, go to APMEX.com or JMBullion.com to check the price of the coins, rounds, or bars, you would like to buy. APMEX and JMBullion are consider some of the most popular websites you can purchase precious metals from. If the price of the gold/silver you are purchasing is greater than either of these websites you are not getting a good deal.
Third, go to your local coin shop (not pawn shop!) and compare the price of the coins, rounds, or bars you saw on the websites mentioned above. If the price is lower at the coin shop (which it most likely is as coin shops tend to give the best deals) purchase your gold or silver at the coin shop. If not, purchase it through the website.
Fourth, enjoy and rest assured that you have gotten a decent price for your gold and silver.
Note: Although there are other ways to go about purchasing gold/silver, which usually require more effort and knowledge; these four steps are easy to do and gives you peace of mind due to the fact you are getting a fair price.
About Stacking Gold and Silver
“If you can’t hold it, you don’t own it.”
“Don’t tell anyone you own silver and gold.”
Gold and Silver for stacking (buying to save) comes in three forms. Coins, which are minted by a government and are considered legal tender. Rounds, which are the same shape as coins but are minted by private companies and are not legal tender. And bars, which are minted by governments and private companies and come in the shape of a rectangular block. Bars minted by governments are typically not considered legal tender. All three types come in different weights. It’s considered fractional when the coin weight is 1/10 oz, 1/4 oz, or 1/2 oz. Then you have 1 oz, 5 oz, 10 oz, Kilo, 100 oz, and much more. There is also constitutional silver, which is any American half-dollar, quarter, dime, or nickel marked 1964 or older. Because those are made out of mainly silver.
The price of gold and silver has two components: the spot price of the metal plus the premium. The spot price is the going price for a particular weight of silver or gold at that moment in time. For example, at noon on Monday the spot price for 1 ounce of silver is $21 and an ounce of gold is $1,800. A quick google, visit to Apmex.com, or any other precious metal site will have up-to-date spot prices at the top. The premium is the amount in addition to the spot price. Premiums tend to be higher on government issued coins than rounds or bars for many reasons; one being their added security features to avoid counterfeiting. As such they are typically in higher demand and will usually fetch you higher-than-spot prices when you decide to sell some of your stack back to the coin shop. You end up paying a bit more up front. But they are easier to sell when needed. Don’t worry it’s not difficult to sell your rounds and bars either. Additionally, fractional coins typically have a higher premium as well. As in the lower the weight the higher the premium.
The best-case scenario is purchasing less-than-or-equal-to the current spot price. This does happen from time to time, but don’t count on it. If you are dollar cost averaging it does not matter too much, but keep an eye out if premiums seem too high. If premiums are high simply switch to a different coin, round, or bar until premiums on what you like go down.
Dollar Cost Averaging
Dollar cost averaging (DCA) is when you purchase a fixed dollar amount of units at a regularly scheduled interval. For example, twice a month you receive a paycheck. With each paycheck you purchase $200 worth of gold and/or silver (this can be done with Bitcoin, index funds, mutual funds, and so forth…). Doing this for a year or more is considered DCA. DCA works because you are purchasing at a fixed dollar amount week-after-week. Anytime the price per unit increases, you purchase less units. And anytime the price of the unit decreases, you purchase more units. This will leave you having paid the best possible average price for the year. Also, when the price of the units becomes really low, you can increase the amount you are purchasing temporally to take advantage of the sale. DCA is a straight forward and economical way to invest. Timing the markets is near impossible and comes with a huge opportunity cost. Dollar cost averaging make things easy and automatic allowing your money to work for you. After all, every dollar is a soldier in the war against scarcity.
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Inflation is guaranteed in the current monetary environment, Gold and especially silver are undervalued in terms of purchasing power. Governments have been dumping Silver for the last 50 years to the tune of Billions of ounces and have mostly run out, while the rest had either been dumped into landfills as electronic components or recycled reused and then dumped.