When most people think about the word investments, they often relate it to the stock market. There’s a good reason for this association. After all, the stock market is an excellent way to generate wealth over time.
However, the stock market can also be extremely volatile. Its fluctuations since the outbreak of COVID-19 made some people a little wary of investing in this market.
During such times, gold investments often become popular. Buying gold is an excellent way to hedge your assets and diversify your portfolio.
The question is, how to buy gold? What are the best ways to buy gold that fits your budget?
If you’re wondering about this, there’s good news! You don’t have to figure this out alone.
In this guide, we’ll explore the different ways to buy gold. So, without further ado, let’s get started!
Purchasing Gold Coins
One of the most popular ways of buying gold is by purchasing coins from the US federal government. For much of human history, people have used gold as a type of currency.
The earliest gold coins minted for currency trace back to roughly 600 BC. Around this year, King Alyattes of Lydia made the first official declaration of gold as money. From there, the Lydian government oversaw the first recorded mint.
The practice of gold as currency remained in many countries until the 20th century. The gold standard remained in the US until June 5, 1933. On that day, Congress enacted a joint resolution that nullified the right of creditors to demand payments in gold.
However, the US government continues to mint gold coins as investment tokens. As such, you can buy gold coins directly from the federal government.
These government coins include a national symbol etched into its face. Usually, this is the American Eagle image. These symbols make it look distinguished and desirable to collectors and investors.
Purchasing Gold Bars
Buying gold coins from the government is an excellent way to acquire gold. However, it’s one of the more expensive ways to buy gold. One reason for the extra expense is that these coins include those national symbols.
Gold coins can also be more challenging to store. This difficulty may require you to spend more money on storage.
So, what other options exist? Instead of buying gold coins from the government, you can save money by purchasing gold bars from private mints.
When we refer to gold bars, we mean the same thing you’re likely envisioning. They’re the same shape as you might see on a Richie Rich or Scrooge McDuck cartoon.
There are a few reasons why gold bars are more affordable. For one thing, they don’t include the federal engraving that a coin would have. As such, you don’t have to pay for this addition.
Another reason is that several private mints offer gold and precious metal bars. As a result, there’s room for competition between competing investment companies. That competition forces these companies to provide more affordable prices to investors.
The government, however, is the only entity that can mint official federal coins. As such, they have more freedom in setting their prices.
Lastly, gold bars are simpler to store than gold coins. There are convenient ways to stack and store bars. This storage capacity makes them ideal for a home safe.
If you like the idea of having gold coins but don’t care about the government emblem, there’s another option. Instead of purchasing these assets from the government, you can turn to private mints.
Private mints often produce precious metal coins that resemble those you’d purchase from the government. To distinguish the two, experts refer to these private coins as rounds. These rounds do not have the American Eagle engraved on the coin face.
Instead, private mints may add several other designs. This way, investors can indulge their collector side as they try to gather as many round designs as possible.
Private mints often produce rounds for more affordable prices than their government-minted counterparts. If you want a creative way to buy gold, these may be the solution.
The Gold Buying Process
Once you’ve determined which gold investments you prefer, there’s a process for acquiring the assets. We’ll briefly walk through that process in this final section.
First, find a dealer you can trust. Plenty of scams exist in the precious metals world, along with several shady practices. Before you buy from a dealer, do your due diligence.
Next, watch out for unexpected fees. Gold dealers often charge more than the gold’s “spot price.” This term refers to the price at which gold trades on an exchange.
Instead, dealers often include a fee in their premiums. Other additional fees include manufacturing and distribution charges.
Once you find a dealer you can trust, the next step is to find a secure place to store your gold assets. There are a few popular options for this.
One method is to purchase a safe and store it in your home. If you follow this route, find an inconspicuous location for the safe. Only tell your loved ones the code for the safe.
Alternatively, you can use your bank’s safe deposit box. Depending on their sizes, though, these boxes can become expensive. A standard bank box can cost anywhere from $30 to a few hundred dollars each year.
Finally, once you’ve purchased your gold, consider purchasing gold insurance. Most home insurance plans will not cover this asset, so you’ll need a separate policy.
Know How to Buy Gold Today
If you’ve wondered how to buy gold, we hope this guide was helpful! Buying gold requires you to do some research. However, once you understand the market, you can start hedging your assets with gold today.
To get started, consider purchasing from us! We sell gold and other precious metals for quality prices to investors across the country. If you have any questions about investing in gold, contact us today!
How to Buy Gold: Your Options Explained CMI Gold & Silver.