Message to a Friend: First Three Steps in Buying Gold and Silver Coins

By Catherine Austin Fitts

STEP ONE: CORE vs. INVESTMENT

The first step is to determine whether you want to purchase a core position in gold and/or silver, or an investment position, or both. Here is an overview of core vs. investment positions.

STEP TWO: WHERE

Once you have determined that you want a core position, the second step is to decide WHERE you want to hold your gold and silver.



Your options are:

  1. At Home
    The benefits of storing at home include easy access, and no cost or low cost beyond investing in one or more safes

. If you do a good job with confidential pick-up and hidden storage, it should be secure

. As for risks, one of the ways people lose money on gold and silver is that they forget where they put it, or they trust neighbors, vendors, and friends who should not be trusted

.
  2. Bank Safe Deposit Box
    When President Franklin D. Roosevelt confiscated gold in 1933, those who had the gold at home generally kept it; only those who held their gold at the bank had to turn it in. Consequently, safe deposit boxes are not well regarded by many precious metals dealers. I find them to be more reliable than most home arrangements. The problem is that safe deposit boxes will be reliable until the day they are not. That is fine if that can be anticipated, but not so fine if it cannot be anticipated. 
Typically, the fees for a good safe deposit box are modest, particularly if you are storing gold. If you accumulate positions in silver, these can require larger boxes.
  3. Depository
    There are a number of eligible depositories. These include CNT in Massachusetts, Delaware Depository in Delaware, Dillon Gage in Texas, and the Texas Bullion Depository. Given the accumulation of a core position and your location, they are likely too far away and too expensive relative to options #1 and #2.
  4. Online Services
    Options include:
 Gold Money; Bullion Vault; and Glint. 
Each has your gold and/or silver in a remote custodian location. Some will deliver actual bullion. Some offer digital access with debit cards. 

These are mechanisms for owning and using gold and silver when times are good. In the worst case, you will want physical metals and will not want to be dependent on digital systems to use your gold. For example, Mastercard is a leader in building the digital ID and control grid; if you want to try seeing how they work, then you can add doing so to the list, but consider it an investment position rather than a core position. 



My recommendation is to start buying gold and silver coins, keeping them in a safe deposit box for now until you have worked out a home storage solution, or keeping them at home if you already have adequate home storage arrangements.



Here are two audios that will help you learn about buying and owning coins. They are dated but still timely:

You can find a list of the common silver and gold coins at the “Equivalents” tables at our Silver & Gold Payment Calculator.

Let me know when you have digested this information, and we will go on to the next step.

STEP THREE: HOW MUCH

You have confirmed you want to buy coins, and you have a post office box for delivery. The next question is, how much do you want to buy and in how many transactions?

For example, you can begin to accumulate like a savings plan, where you buy a set amount every month. This works if you are buying from income coming in and do not want to make the purchase from your existing savings.

Alternatively, you can purchase all you intend to buy in one purchase—or spread the purchases over several dates if you want to “average in” (this is something one would do if they thought the price might go down or if they preferred to manage the transportation risks with smaller amounts at a time).

How much you want to buy at a given time will help determine whether you buy gold or silver or a combination. My recommendation is to keep things simple: buy 1-oz gold coins and 1-oz silver coins and/or 90% U.S. silver (sometimes called “junk silver”). See:

Again, you can see the names of the common 1-oz silver and gold coins at the silver and gold “Equivalents” tables at the Silver & Gold Payment Calculator.

The prices listed at the Calculator are the coin’s value at spot price. The spot price reflects the melt value. When you purchase from a dealer, you will pay a premium over the spot price. You are looking to buy at the lowest premium to spot.

When you sell it back, you will receive a discount from the spot price. However, the spot price will give you a sense for the approximate price.

Let them know how much you want to purchase, and whether you wish to purchase up front or over time, when you speak with them.

Normally, I recommend that a purchaser speak with two different firms so that they learn how to compare multiple prices. Here are two:

  1. Volunteer Precious Metals
  2. Treasure Island Coins & Precious Metals

My recommendation is to call both firms and ask them for their advice on what coins they would recommend, given what they have in inventory, and then price out a potential purchase. It is fine not to make a purchase—to say you want to think about it—and to compare recommendations, pricing, and delivery times.

Then let’s discuss your questions and the next step.

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