Recent years have seen a surge of interest in buying gold and silver coins, which also raises the price of both precious metals in the market. However, the record-breaking high also comes with increased concerns of making safe and secure investments, especially for first-time investors.
To mitigate the risks of being a victim of fraudulent transactions and to maximize the financial value of your investment, below are three tips on how to buy gold and silver coins the right way.
1. The reputation of the dealer is important:
As with every investment, you need to transact only with reputable dealers or firms. This no-nonsense recommendation is one that keeps the fakes and the scams at bay. When you plan to buy gold bullion online or from a dealer near you, only deal with a company or a person that has a respected name in the industry, who also has sufficient experience in buying and selling bullions in fluctuating markets.
If you are unsure of the authenticity of a bullion dealer, you can look them up from authorized dealer lists and directories. Also, check for memberships and accreditations because it means that the dealer has to adhere to a strict code of ethics. You can also check the Better Business Bureau rating for a particular dealer before you transact with them.
Make use of the Internet when checking on the credibility of the company you wish to buy gold and silver coins from. Check out the company website, their online profile, previous customer feedbacks, client reviews, satisfaction ratings, and even any existing lawsuits that the company or person may be involved in.
2. Knowledge is power:
Researching and familiarizing yourself with the gold and silver industry will equip you with the necessary information to make an educated decision when it comes to investing in precious metals. If you invest in bullion coins, learning about these coins before you purchase them will be your best protection, especially against overpricing. Make sure to buy at a price that is based on the up-to-the-minute spread, which is calculated from gold or silver’s up-to-the-minute spot price.
For example, knowing the actual cost per ounce of these precious metals is important in deciding whether to buy or sell your assets. The prices of gold and silver fluctuate daily, so it is highly recommended that you check the spot price for the day that you intend to buy or sell them. Typically, the American Eagle and Canadian Maple Leaf bullion coins have a high retail price. There are also fees and commissions involved in the buying and selling of gold and silver. For an ounce of American Eagle coins, the average retail commission is at 5%.
3. Make sure the coins are delivered in a timely manner and in pristine condition:
When buying bullion coins, make sure that the gold and silver coins you receive are in mint condition. Any scratch or sign of deterioration will lessen its value, meaning you should have paid less for the coins. In addition, should you consider selling these assets in the future, you will find that dealers will either refuse to buy them or do so at a discount of as much as 15% from their value. Now that doesn’t sound like a good return on investment, right?
Also, arrange for immediate delivery, which is characteristic of credible dealers. If immediate delivery is not possible, make sure you get a written confirmation from the dealer indicating the delivery date, so you know when to fully comply with your obligations as the purchaser.