goldapalooza

Like many investors, you may be concerned about the ups and downs of the stock market. Gold is often seen as a more secure way to invest for the future. Some people want to have physical holdings instead of money in the bank. Whatever the reason, you might be interested in the basics of buying gold, and how to begin your gold investment.

Why Invest in Gold

People feel more secure storing their capital in gold instead of in banks. It’s a physical store of value. Gold will survive wars, natural disasters and banking crises, the funds in a bank account may not. Gold bullion also holds value in any country, so you can travel around the world, changing your gold into local currency whenever needed. Before you begin storing your money in gold, you should learn about the ins and outs gold buying.

Gold Purity

Gold comes in different levels of purity. Investment gold is fine gold, which is rated .995, which means that its 995 parts gold out of 1,000 parts of metal. The other metals in gold make it an alloy. The purest type of gold is called “Four Nines” because it 999.9 part out of 1,000, or .9999. Gold can also be rated karats, which are in a scale of 1 to 24, with 24 being the purest type of gold. When you buy gold jewelry it's usually measured in karats.

Types of Gold Bullion

There are different forms of gold bullion. Gold bars and gold coins are the most popular, but gold bullion also comes in different varieties, such as wafers or ingots. Government mints often manufacture gold coins. For example, the United States Mint makes American Eagle gold coins in a variety of sizes and values. Most gold coins are at least fine gold, with a .995 purity. Be sure to ask so you know what you are getting.

Other Things You Should Know About Gold

The history of gold bullion dates back to the early days of civilization.  From the Egyptian mummies to the Old Testament, there are countless references to gold.  Modern investors also talk about using gold to preserve wealth. The modern history of gold bullion makes it one of the most viable investments today.

The Gold Rush

For centuries, people used gold for currency and trade.  Over time, the supply of precious metals started to decline.  The gold standard changed, and people sought this valued commodity even more.  However, the Gold Rush started by chance.  John Marshal was building a saw mill in California when he found gold flakes. His discovery in 1848 sparked the famous California Gold Rush.  As a result, the American West was settled.

Gold Prohibition

The prohibition of alcohol is a famous topic, and there are still cities in the United States that remain liquor-free.  Few people remember that the history of gold bullion includes a bit of prohibition. In 1933, Franklin Roosevelt signed Executive Order 6102 that outlawed citizens from hoarding gold.  People who owned gold coins or items faced a significant fine of $10,000 and could spend a decade in prison.  The only ones who were permitted to own gold were jewelers, dentists, and industry workers such as electricians.

Moving Past the Gold Standard

The history of gold bullion also covers the value of currency.  In 1972, President Richard Nixon formally ended the convertibility of the U.S. dollar to gold.  Countries no longer use the gold standard for currency.  By now most governments use the fiat standard.  In Latin, the term fiat means “let it be done.”  This government-authorized form of currency was opposed by leaders such as Andrew Jackson and Thomas Jefferson.  Several modern economists feel fiat currency boosts boom-bust cycles and ultimately leads to inflation.

Welcome Stranger

The modern history of gold bullion would not be complete without dubbing the largest nugget ever found.  Richard Oates and John Deason discovered the largest gold nugget, called Welcome Stranger, in Australia in 1869.  The nugget was 2,248 ounces of pure gold located only two inches below the ground.  With gold value in mind, an ounce of gold went up to over $1,000 in 2008 as investors feared a recession.  Early in 2009, the World Gold Council reported the demand for gold rose drastically during the final months of 2008. Wise investors still turn to gold to preserve their assets for the future.

If you are thinking of purchasing gold bars it’s understandable that you would want to know the average price for gold bars. Unfortunately, however, there really is no “average,” or at least not a stable one.Determining the Value of Gold While gold will always have some kind of value, that value of gold does change from time to time. It goes up and down as the market and the economy does the same. This means that every single time you purchase gold bars, even if you’ve done so a hundred times before, you need to take a close look at the market and see what the current going rate is for gold. This current value is referred to as a “spot price” and is generally based on the weight of the gold bar.

Premiums

When you purchase gold, you will almost always have to pay a little bit more than the spot price. After all, sellers do have to turn a profit from their product. However, you should never pay a lot over the current spot price. The only way to know the difference between what’s fair and what’s exorbitant is to do some shopping around.

Buy Gold From a Trusted Seller

Look to see what various companies, financial institutions, and even independent sellers are offering their gold for, keeping in mind that not all of these entities are equal in terms of their reliability and the quality of the products that they sell. You should aim to pay close to the amount that most high-quality sellers are asking, and while it can be tempting to just go with the absolute lowest rate that you find, do be wary of too-low prices. Remember the old adage “you get what you pay for,” and use good common sense and judgment.

Anyone Can Buy Gold

It’s also important to note that oftentimes, the price you pay to actually acquire your gold bars is only the beginning. While gold is not an expensive investment—in fact it’s one that just about anyone can afford—it does have some associated costs that many first-time buyers often overlook and thus fail to plan for.

The Cost of Storing Gold

If you plan to have your gold shipped, for example, there will be shipping and handling costs involved, and the more gold you’re buying, the higher the cost is likely to be. Likewise, if you plan to hang on to your gold for a while, storage fees will come into play as well.

Don’t let inexperience hold you back from buying gold coins. Buying precious metals like gold and silver is easy for everyone to do. You don’t have to have a lot of experience to get great deals on precious metals. Buying precious metals is a great way to invest your money, so get started today.

Photo Credit: Money Metals

No Experience Necessary

Most people are intimidated by the idea of buying gold coins and other precious metals. But there’s no reason to put off buying gold and silver. Smart investors buy precious metals because they know that there is no better way to protect their money. Even if you have never invested money before, you can become a smart investor when you buy gold and silver online. An experienced precious-metals dealer will give you all the information you need to make a smart purchase.

Start Today

One of the most common myths associated with buying gold coins and other bullion is that you have to spend a lot of money. You don’t. If you want to put thousands of dollars into gold and other precious metals you can, but it’s not necessary. If you are a new investor who only has a couple of hundred dollars to invest right now you can buy gold to protect that investment money. Buying a few gold coins is a great way to get started. You can learn more about the value of gold as you go along.

Buy Gold From Anywhere

As long as you have an Internet connection, you can buy gold online. You don’t need to find a local dealer or take a lot of time to build up connections within the precious-metals community. Just find a reputable online dealer to buy gold from. That dealer will have the experience and connections that you don’t have. A great gold dealer is the best investment partner you can have. That dealer can be your investment adviser, your partner, and a great source of information. You can get all the tools you need to make smart investments in precious metals from an experienced dealer.

Preparing for the Future

After you buy gold coins other types of precious metals, you need to make sure they are stored securely and safely. Don’t let your future disappear because you didn’t protect your precious metals. Take these tips from other investors on how to securely store gold and silver to make sure that your own investments are stored safely.

Off-Site Security or Easy Access?

When you invest in precious metals, one of the biggest decisions you will need to make is how to store it. If you choose to store your gold bullion in a storage facility or safe-deposit box, it will be very secure, but you might not have easy access to it in an emergency. If you keep your gold coins, bars and other items at home they might not be as secure as they would be in a dedicated storage facility. But you will be able to get to your gold and other metals anytime you need them. Only you can decide whether security or access is more important to you. But consider storing some of your investment gold in secure facility and some at home if you can’t choose between the two.

Home Security

If you want to keep your gold coins and other precious metals at home, there are ways that you can increase the security of your home to protect your investment. You can install a home alarm system if you don’t have one. You also can have a large safe embedded in a closet, in a floor, or even under your bed. The closet is the first place that a would-be thief will look however. So you may want to be creative and install the safe somewhere unexpected. Some companies are now making large home safes that fit under your box spring. These weighted safes are too heavy and large for a robber to move and are very difficult to break into. You also may want to put several safes in different rooms of your home and store some of your precious metals in each one.

Outsmarting a Robber

According to some experts, just by thinking creatively about where you store your precious metals, you can increase the chances that a robber would not be able to steal your gold and your future. Think outside the box and find unique storage places in your home for your valuable items. Try putting a custom-built safe in your pantry, dining room or other room where there is a lot of traffic. Hiding your gold in plain sight by disguising it is also a good way to keep it safe.

The Best Way to Keep Precious Metals Safe