People own gold in different physical forms – bars, coins, and jewelry. You can easily get gold from a neighborhood jeweler or an e-commerce site. But you need to be careful when doing so to avoid entangling yourself in an illegal business.
To make sure you do not run into problems later, we curated some useful tips for buying gold. Keep reading to learn more.
1. Get Only Physical Gold
You can hold gold in paper form but this method generates problems for the investor when it is time to cash out. They suddenly realize that there isn’t enough physical gold to match their claims. Therefore, when you want to buy gold as a hedge against inflation or currency devaluation, ensure you have the physical commodity. You can visit this website to learn how to buy physical gold.
We encourage the physical form because some paper products don’t guarantee ownership. So if you are purchasing an ETF, ensure you read their T&Cs thoroughly. Sometimes, ETFs won’t tell you that they have the physical product. Also, in the event of a war or monetary crisis, you can only collect cash, not the physical metal, when you want to withdraw your assets.
Therefore, if you want to buy precious metals as insurance or for long-term holding, ensure you actually own them. Additionally, cross-check the details of each commodity, including hallmarks and bar numbers.
2. Buy Liquid Bars and Coins
Every investor wants to get as many precious metals as possible for their cash. The main idea here is to grow a liquid gold stock. You can do this by investing in coins that are used as legal tender. Some examples are Australian Nugget, Maple Leaf, and Austrian Philharmonic. So when there is a crisis, you won’t move about with a 1-kilo gold bar.
Furthermore, when purchasing legal tenders, ensure that their fabrication fees are low. For instance, if you buy maple leaf, the cost of 1 gold ounce should be almost the same as the spot price of paper gold. This will help you determine the value of 1 ounce. If you are not buying directly from the mint, make sure you do not pay above 5 to 6 percent.
A general principle for investing in liquid bars and coins is – the smaller your units, the larger premiums clients will pay. This implies that a bar of 1 kilo will cost less in premium than a coin of 1 ounce. You can check out metal-res to read more about it.
3. Buy with Your Savings, Not Credit
If you want to buy precious metals, you must save up before investing. That’s the bedrock of a strong economy. You shouldn’t rely on consumption, debt, and credit. You can’t predict the market and you need to pay the credit before gold prices rise. Therefore, to avoid unnecessary pressure, buy with your savings.
4. Avoid Storing in a Bank
The antidote to the economic crisis is physical gold. The existing banking system relies heavily on computer digits, credit, and paper. As a result, more people are purchasing precious metals to protect their wealth in case the banking system fails. Hence, it is logical to keep your physical metals outside the bank.
Although the bank offers property rights, they are temporal. There have been cases where banks confiscated physical cash and gold. Therefore, there is a possibility of a reoccurrence.
Even if you store your assets in a deposit box, there is no insurance. In the face of crisis, banks will either be closed or not have the volume of physical precious metals they claim to have. We should learn from past events and do better than taking the risk of storing gold in a bank. Instead, store your assets in private vaults for better access.
5. Comply with the Law During Purchase
While it may be impossible to buy so many coins in one purchase, it could be to your own advantage too. Buying a few commodities each year allows you to purchase them privately. You can remain anonymous; there won’t be any need to disclose personal information, and this is completely legal.
On the other hand, if you want to purchase bigger amounts, you must comply with certain laws. Ensure you follow the stipulated laws and declare the assets. If you are afraid that the government may confiscate your assets, you can store them in a jurisdiction that is safe. You can visit https://snbchf.com/swissgold/countries-store-gold/ to learn about safe jurisdictions.
Gold is a historic store of value, but you want to be sure that you own it and can access it at any time. The tips we shared will help you when you want to purchase and store your metals. And if you do not want your assets to be confiscated, you can choose international storage.