June 1, 2022
If you are in the market for buying silver bullion coins, it’s a good idea to do some research before you get excited and make your first purchase of precious metals because some talk show host said that it was a good idea.
When purchasing silver or gold bullion, consider why you are buying. Is it for appreciation, liquidity, or safety? Are you going to be a collector of rare coins or an investor in silver bullion?
A few years back, I heard a very wealthy man say that an ounce of gold should always buy a fine woolen mens’ suit. What he is saying is that the value of gold usually remains steady even though the price fluctuates. This also holds for silver. Investors that buy silver bullion do so as a hedge against inflation. Owning silver or gold also presents some unique investment opportunities when certain asset classes such as real estate go down in value during normal economic cycles.
Another aspect that you need to consider is the storage of silver bullion. Because silver is relatively inexpensive, storage of large amounts of this precious metal is both difficult and expensive. Will you be cutting a hole in your wall and storing it behind the family portrait or will you purchase a heavy-duty safe such as the one used to store valuables? Many suppliers offer storage from them at a fee. It is not recommended to store your silver or gold in your bank’s safety deposit box as we are in the midst of a banking crisis along with many bank closures. If your bank closed its doors, your valuable assets will be tied up for long periods. It’s always better when you have control over your assets.
There are hundreds of dealers marketing silver bullion coins. The most reputable companies have an online presence. I like to go to Amazon and see what other people are buying. Amazon is a portal for many online dealers of precious metals. You can read reviews from real customers.
A reputable company usually acts as both a buyer and seller. You must be aware that there is a selling and buying price. This is known as the “bid” and “ask”. Precious metal dealers make money off the spread. It’s not much different from a currency dealer.
If you are looking at investing in silver bullion, consider other precious metals such as platinum and palladium to diversify your investment. Make sure that you check the liquidity of platinum and palladium before you jump into purchasing these metals as they are not as popular or well-known as silver & gold.
Purchasing silver bullion coins is easy and you can even start with as little as 1 oz American Silver Eagle coin or generic 1 oz silver bars. If you have concerns about the stability of gold or silver as an investment vehicle, do some research and you will find that both silver and gold are the original forms of money.
Silver is used in many manufacturing processes such as semiconductor manufacturing and the photographic industry. Silver is widely used for jewelry and table silverware. Investors are waging a buying battle with commercial industrial users. Gold, while less used in industrial applications is used as storage in jewelry and rare coins. Therefore, there will always be a commercial demand for most precious metals. Additionally, both gold and silver are in short supply.
Silver bullion bars are a great value because the production cost is less than minted coins. The value of the silver content in both will be the same. The ornamental and decorative impressions on silver bullion coins add more to the total price than to the spot price of precious metals.
Buying precious metals like gold, silver, or platinum bullion is considered one of the safest ways to secure your wealth. At the same time, it’s not an investment vehicle that you can normally purchase through leveraged actions like real estate. It is a great investment vehicle that will ride the tides of any economy. If the paper money or fiat currency were to crash through hyper-inflation or deflation, the value of your precious metals will remain constant.