Thinking of buying gold coins...

[CountryGent]

Silver is a better buy.

Agreed. We keep about 15% of our liquid assets in investment grade bullion. Some gold, a tiny bit of platinum, but mainly silver.

 

[wired]

The good thing about assets like gold. cash, real estate etc is when you get real old and guess what...SHTF or The Rapture never happen ...you can sell off all that junk to keep yourself alive for a few more years in the nursing home. They dont take payment in ammo or eggs or MRE's.

Sorry to inject reality into the discussion.

 

[Olderguy]

The very small amount gold that I have had in the past I preferred to buy directly from the US Mint. Just establish an account and give them a credit card over the phone. It might be a little more expensive than some dealers but due to the concern about buying a counterfeit coin, it was worth it to me. Possibly I was over concerned about counterfeit coins BUT they do exist. I never liked the gold bars or the independent mint products, as I didn't think they would be as easy to sell when needed but this is just my non professional opinion.

 

[2Wheels4Ever]

I'd invest in ammo any day over silver or gold. It is likely to have a higher ROI than silver or gold and it will actually be useful if anything catastrophic happens. On top of that, common ammo is unusually inexpensive at the moment. I don't expect that to last.

 

[leadcounsel]

The good thing about assets like gold. cash, real estate etc is when you get real old and guess what...SHTF or The Rapture never happen ...you can sell off all that junk to keep yourself alive for a few more years in the nursing home. They dont take payment in ammo or eggs or MRE's.

Sorry to inject reality into the discussion.

1. Ammo and MREs might allow you to actually get to old age versus piles of PMs that possibly people won't want or might just take from you if you lack ammo and guns.

2. Why can't you sell ammo in your twilight years? My ammo has all gone up in value. Some significantly. All those cases of Mosin and Tokarev food tripled or more in value, while also sitting as a useful asset.

 

[leadcounsel]

I'd invest in ammo any day over silver or gold. It is likely to have a higher ROI than silver or gold and it will actually be useful if anything catastrophic happens. On top of that, common ammo is unusually inexpensive at the moment. I don't expect that to last.

Bingo my friend. And for many citizens, it is getting harder legally to acquire every year. FOIA cards, taxes, state permission slips, background checks, bans on internet sales, bans on lead, limits on monthly purchases, etc.... And then there's scarcity during price spikes. We all experienced that several times in the last 10+ years. All of this adds to the hassles, costs, wrongful denials, shortages, etc.

You can always buy harmless PMs... not so with ammo.

 

[Siglvr]

I'd invest in ammo any day over silver or gold. It is likely to have a higher ROI than silver or gold and it will actually be useful if anything catastrophic happens. On top of that, common ammo is unusually inexpensive at the moment. I don't expect that to last.

If you don't have craploads of ammo I'd agree. Stock up. But not true if you say, already had over 20,000 rounds of 5.56 and all other calibers pretty well covered. Ammo, and all SHTF items like food, water barrels, etc etc as it turns out, takes up a lot of physical space. $6000 worth of 5.56 is @ 2 feet x 3 feet x 5 feet. $6000 worth of gold fits in the palm of your hand. Nobody is advocating one over the other. For myself, I would be advocating both, perhaps we are on the same page here.

If a person only 50-100 rounds of 5.56, then I don't believe you have any business buying any gold. If you have 20,000 rounds of 5.56 like you should, and no gold, then perhaps the same applies, you have no business buying more ammo. It's all perspective. Remember though, in 50 years you will have old ammo so you will have to work at refreshing it, shooting the old and buying new, and you will find less sellers for old used ammo and for a lesser price. Gold doesn't age.

Buy cheap, stock deep. Both.

 

[Medic!]

Just noticed it's $1620 an oz this morning.

 

[EHJ]

Just noticed it's $1620 an oz this morning.

That's nearly $55 bucks an ounce up since this discussion started...

Spot Silver

SILVERPRICE.ORG - The number 1 web site for spot silver price charts in ounces, grams and kilos.

silverprice.org

 

[wired]

Note to self . Kick ones self in the butt for not buying a bunch at $270 an ounce in 2001.

 

[Capn Jack]

I get two silver ounce coins every Christmas from my parents, they do the same for my kids as well (4 kids). When I turned 20 I started buying silver bullion (1once at a time) and as I got older I started buying silver bars (10oz). I keep them in sealed worn looking pales that can be gunned in plain sight, LOL. One time I was going to cast some lead bullets and grabbed the wrong bucket and almost made an expensive mistake.

As a hedge against werewolves no doubt.
I've been tempted to cast a few just for grins.

 

[Capn Jack]

Back when silver was $7 - $8 an oz , my wife and I used to buy the 1oz ingots from C-Ryne in Seattle and give them to my daughters friends (on birthdays) to wear as necklaces.

 

[wired]

I gave my wife and daughter in law 1/2 ounce gold "coins" on necklaces for Christmas with a special note to the daughter in law that she should consider it a redeam in case of emergency token.

 

[gmerkt]

From what I understand, the Canadian Maple Leaf is 100% gold as opposed to the American Eagle/Liberty coin that is .999999 22k.

Alloy content of the coin is of no significance so long as the net gold content is the same.

-I want to keep some money off the books away from government

Governments have a way of getting in the way sometimes. FDR administration caused a turn-in of gold by US citizens in 1934, followed by a decades long ban on owning it. Kinda took the legal liquidity out of it. There are some federal government reporting requirements for dealers when certain thresholds are crossed. They are supposed to report redemption purchases of over 25 one ounce coins; of over $1000 face value bags of US silver coins, etc. I don't know if dealers typically do this or if the government ever asks any questions later on the basis of this requirement.

-How do I protect myself from getting ripped off even buying from a reputable gold coin dealer in Bellevue? What is a foolproof way to test the gold?

A good dealer of any size these days usually has one of those electronic scanners that reads the material content being scanned. I've asked that this be done a few times and they've done it for me.

My advice, do not buy PM coins on the sites such as ebay. Too much opportunity for buying counterfeit coins which is going on a lot. One gold coin commonly faked, the Panda.

-What is involved in selling gold, will a dealer charge me a fee to buy back?

There is always the "spread," the difference between buy and sell.

-What are some of the risks of owning gold?

Many but now at my age, one is that I may forget where I've put it.

a banker buddy of mine said "gold is for major investors" not the average citizen

There is some truth to this. But the big "investors" may be characterized as speculators who are interested in shorter term gain. Small buyers are more likely to be buying gold to hold long term as a form of insurance.

Silver is a better buy.

Right now, I'd say that is a fair statement. The ratio of silver to gold is very wide compared to historical reference.

5k in 2009 bought 500 oz silver (@$10/oz) - By 2011 that same 5k/500 @10 went for nearly $50/oz. $5k got you $25,000.

5K of gold in that same period (@1k/oz.) in gold only brought $1,750 an oz - or $8,750 for that same 5k investment

For this example, you've cherry picked a moment in time where values were askew. Look at more recent numbers to get the opposite view.

Value is akin to antiques. If everyone likes it / wants it, its valueable. When everyone decides they don't like / want that anymore, value drops.

This is true, to some extent, with many asset types. As one financial guru said recently, "Right now, we live in an expensive world." Meaning, just about everything is being avidly pursued and there aren't many alternatives that seem like a good deal. Time will reveal if some form of major financial adjustment will reverse this trend.

Just looking at the last 8 years after a spike, both silver and gold have lost a LOT of value. And their volatility seems arbitrary and unpredictable.

Gold has recovered a lot of the value that it lost in 2011. Silver not as much, ratio is pretty wide right now. Both of those highs came and went fairly quickly which supports the idea that they were artificial. Both have never re-tested the lows of the trough following 2011 so we might consider those low values as a floor in prices. Unless some major deflationary adjustment comes along and blasts all asset classes.

I honestly am kicking myself whenever I think of Apple, Amazon, and Bitcoin. I nearly invested in these and wish I would have, or course. Oh well...

You can't do this. There were reasons you didn't buy when the opportunity presented itself way back when. The few people who did were more lucky than smart.

Stay away from numismatics

I agree, no reason to pay premiums for coins you want to hold as insurance against difficulty.

The best investments are the ones which generate revenue.

Yes, but my concept of owning precious metals retail is basically one of insurance. I don't own them strictly as investments. I have other things that throw off investment revenue. If I am lucky, I will never have to cash in my PM but it will be there for my wife or children to have in case they need emergency money. And emergency can take many forms.

I would recommend that if you are buying precious metals stamped in to coins that you only buy the coins for the value of the actual precious metal therein, not the additional costs of stamping etc., which you won't get back when you sell them (unless you can find someone else who is willing to throw some money away by buying coins at their 'higher-than-billet' price). When you sell it, you will most likely be selling them for the value of the metal by weight alone, not any additional perceived value from them being stamped out in coin form. I strongly share the recommendation of the posters who recommend buying billet metals instead of stamped coins. If you are buying coins at anything other than the straight metal price, you're paying a premium (read: giving your money away) just for having them in coin form, and you're not likely to ever get that back.

There is truth to this. Best said, a premium paid for coinage eventually goes away. BUT: There is a recognition value in certain coinage. People recognize and favor an ounce of silver minted as a US Government Eagle coin over that of say, a generic silver round.

The good thing about assets like gold. cash, real estate etc is when you get real old and guess what...SHTF or The Rapture never happen ...you can sell off all that junk to keep yourself alive for a few more years in the nursing home. They dont take payment in ammo or eggs or MRE's.

This is one of the forms of insurance/emergency I've mentioned. Surely you can't completely rely on "extended health care plans" because most of them only pay a fraction of the amount needed by the time the buyer actually starts claiming against it. Inflation of the worst sort.

I'd invest in ammo any day over silver or gold.

I'd recommend both.

Why can't you sell ammo in your twilight years?

Well, because the ugly fact of government can intrude. There is now ammunition regulation in California, was proposed in Wash. this session but likely not to pass. Who knows how far this will go, but my guess is it won't go away. In both cases, private sale of ammo was prohibited. So you lose liquidity on this asset to some extent if you can't legally sell it.

Just noticed it's $1620 an oz this morning.

Yes. And who knows what the future will bring. But I myself don't like to buy when the trend seems high. My tendency has been to "buy on the dips" instead of the peaks. I've bought gold at under $300 the oz. And held it for years and years without interest but as a form of insurance that i hope to never need. I've bought gold sporadically over the years since then at higher numbers but when it got into the low teens, I throttled back to see what happens. Lately, I've been more interested in silver because of the historically wide spread.

Gold has had some secular moments in the past five decades where big spikes occurred. Like 1980 and 2011. These were both points when artificiality took over the markets momentarily. But it gets back to the, "Gee, I wish I woulda ..." Nobody has a crystal ball and timing markets can be hazardous to your pocketbook. Once again, we are in a phase where gold prices have been climbing pretty quickly (along with other asset classes) so we wonder if another of those secular moments of price peak is approaching. Who knows. But these relatively quick approaches into higher prices make me nervous.

So back in the 1990's, central banks were dumping gold, getting rid of the "barbarous relic." Now, they are buying gold again. Do they see a need to maybe some day prop up the paper currencies of their client countries? Are the Chinese and Russians stupid for stocking up on gold? Time will reveal the answers.

 

[gmerkt]

Speaking of government interference. The Wash. House Bill HB 2947 (ghost bill introduced to keep the magazine ban alive) contains a provision for a magazine buy-back through the state patrol. To fund this buy back, the legislature repeals the tax preference (meaning no sales tax) on gold and silver bullion and bullion coins. Effective 4-1-2020. I'm not sure if this has been passed into law on the floor yet or not.

 

[Defense Minister]

My sad confession....I almost went to work for Microsoft in 1986.
In those days, new hires HAD to buy 5 shares of company stock, which was taken out of your first cheque.
In 1986, whole stocks of Microsoft sold for $10 a piece.
I turned down the job because, not knowing what a "Mircrosoft" was, it sounded like a pyramid scheme to me and I had so many bills that needed attention, I couldn't spare the $50.
....

My in-laws bought hundreds of shares of MS early on over a period of time. It has gone up over 8000% since then...

Allocate no more than 5% of assets towards precious metals. It's only an inflation hedge. Don't follow the "doomsday" forecasters--if it really came down to Armageddon gold wouldn't matter anyways. Simply have a small amount invested in physical bullion or ETFs so you can sell when the price climbs high. Anything past that should be treated like a hobby.

Totally agree with this if you substitute the word "hyperinflation" for "inflation".

The one thing I will add, however, is that silver could potentially be a good investment since we are consuming it at such an astronomical rate in the manufacture of electronics such as laptops and cell phones as it is still relatively cheap and is a great conductor of electricity (better than copper). If this demand begins to outweigh supply at some point, silver will skyrocket!

 

[DeanMk]

My in-laws bought hundreds of shares of MS early on over a period of time. It has gone up over 8000% since then...

<-- ME

 

[StealthMode]

From what I understand, the Canadian Maple Leaf is 100% gold as opposed to the American Eagle/Liberty coin that is .999999 22k. Local coin store has them for $1,609 an oz. which is $20 a coin cheaper than AMPEX...

I'm considering buying gold because:

-I have a portfolio of rental real estate, stocks and cash in the bank. That cash is sitting waiting for buying opportunities. I'm losing some money on the value of it (it is in a high interest savings and CD but still not up to par with inflation).

-I want to keep some money off the books away from government and away from home without it losing it's value due to inflation. Enter the reason I want to buy gold.....

-This has been recommended as a part of a balanced investment portfolio anyways as it does well when the economy tanks. Asset classes don't move in tandem. When stocks are doing well, gold usually goes down (and you use cash to buy more gold). Then when the stock market tanks you cash out the gold and buy more stocks at a discount).

Questions:

-How do I protect myself from getting ripped off even buying from a reputable gold coin dealer in Bellevue? What is a foolproof way to test the gold?

-What is involved in selling gold, will a dealer charge me a fee to buy back?

-I looked into AMPEX online to buy gold but the shop in my area is cheaper and I'd rather not have it shipped.

-What are some of the risks of owning gold?

-Is it better to keep in safe deposit box or look into...alternative storage solutions...

A lot of great information here…



As far as responding to the OP questions I can share some of my own experiences recently on going down this path.

- I had to determine my game plan and stick with it.

I wanted to convert x amount of cash on hand, to an amount that was equal to x amount of my total net assets, into precious metals.
Of that percentage, approximately 70% in silver and 30% in gold.

My plan is to hold onto it long term and use it if needed (which could be many different reasons) or pass it onto my kids once I'm gone.

I stay awayfrom collectibles/graded/proofs/numismatic coins and focus more on weight. I think of silver and gold 1st as an insurance policy against coming inflation, deflation, hyperinflation, etc. and 2nd as an investment.

- I bought from a local dealer first. No online sales to start, as I wanted to develop a relationship with a local store. Their prices are better than most all of the online stores I looked at too…someone's got to cover that "free" shipping somehow.

Sunshine Mint produced my first gold and silver bullion purchases, they micro-engrave a security feature onto the back of their bullion that helps verify it's the real deal. At least for me it gave me some peace of mind. I bought out most of the inventory BRC had and there seems to be a 6-month backlog on more coming in.
I did just visit JM Bullion and they seem to have some in stock from SMI.

The other option I went with was buying American Silver Eagles, which is one of the most popular, highly recognized coins out there. Sure I will pay a small premium but I should be able recoup this when it's time to sell and I can trust it hasn't been counterfeited,

BTW, as far as discretion goes, I recently went into BRC with cash and walked out with a monster box (500 pcs) of Silver Eagles. No personal information on the paperwork, just "cash" were it says "customer".

- Buying/ selling…there is a premium paid either way. Usually from what I read, about 2%-3% in each direction. My plan is to hold onto it for a while so I don't think this will impact me.

- As far as safe storage goes, folks have been burying their gold for thousands of years! Doesn't mean you have to do it in the backyard, could be many creative places to stash it…just don't put it all in a safe, that's the first thing a thief looks for and will remove from your house. I suggest you research were to safely stash your PM on the net and you will come up with some good insight and strategies.

Judy Witherrite on Quora is just one of the sources I gleaned some info from…here is a post from a few years back; I think current values this week solidify her point even more...
"Back in 1913 when the Federal Reserve was established a $20 bill and a $20 gold coin were interchangeable, they had the same purchasing power.
Today that $20 gold coin has $1,300 in purchasing power, but the $20 is still just $20 dollars. That means your paper money has devalued $1,280 dollars. That is crazy!
I would have preferred to have inherited a bunch of $20 gold coins from my great-grandmother rather than a bunch of her $20 paper bills."

Most of this is just my opinion but I hope it helps...SM

 

[Bushman]

I'd invest in ammo any day over silver or gold. It is likely to have a higher ROI than silver or gold and it will actually be useful if anything catastrophic happens. On top of that, common ammo is unusually inexpensive at the moment. I don't expect that to last.

If you actually look at charts of the price of ammo and gold over the last 20 years, you'd understand how incorrect that assertion is. I pay less for ammo now than I did 14 years ago (although not as little as I did almost 20 years ago). Gold is worth 5 times more than it was about 20 years ago. Ammo is about 2 times more than it was....

 

[wired]

I think theres just a lot of people trying to justify that pallet of .22LR in their basement.