In this short article, we look at the question “buying gold coins vs bars?” We look at the pros and cons on both sides and we also go over the obvious reasons why gold is a must when it comes to any smart investors (you) part of your portfolio. As always, please leave your questions (or comments) below and I will be more than happy to hear from you and also answer any question!
We will not only go through coins vs bars but also look into the top 5 reasons why you want gold in your portfolio overall, and also we will look on when the time is tight, in short when the best time to invest in gold is.
This and and MORE, ok with that being said, let´s get into it!
P.S. (Other recommended resources)
Before looking at Coins vs Bars, and what differs them, let´s first refresh our minds with why gold is essential in any intelligent investor person portfolio:
The Top 5 Reasons You Need Gold In Your Portfolio:
Gold is one of the most coveted metals in the world, incredibly popular both as an investment and as a display of wealth and prosperity. Gold should be a part of any balanced portfolio.
Or what do you think? Here are 5 reasons why:
#1 The History – Since it’s discovery thousands and thousands of years ago, it has maintained its status as a store of value. Name a paper currency that has remained completely stable for that long.
#2 Inflation is Good (for Gold) – Gold has traditionally been a great hedge against inflation, and its price tends to rise when the cost of living increases. Inflation eats away at cash and bonds, but Gold is a safe haven.
#3 China & India Love Gold – Gold is super hot in both of these fast-developing nations. Prices in India have been at all-time highs and constantly rising, and gold has become a prominent gift in China. The global demand has increased, and so have prices.
#4 The Supply is Shrinking – There’s only a finite amount of gold in existence. And it’s all that can ever be created. It’s only going to get more and more scarce. The “easy” gold has already been mined, so the increased cost of mining will push up gold prices.
#5 Central Banks are Building Up Their Reserves – Since 2010, central banks around the world have been buying gold as they diversify their reserves. They’ve purchased a whopping 371 TONS in 2017… Central banks buying gold in order to store value is a good sign that we the investors should do the same, right?
Buying Gold Coins vs Bars?
We all know that intelligent investors turn to precious metals to diversify their portfolios and protect their hard-earned assets. Paper currency constantly fluctuates and can be artificially driven up or down based on unpredictable social and political influences. So you decide to take the leap and finally invest in gold, but an important question faces you right away.
- More collectible value than bullion bars
- Legal tender status (though the metal content is more valuable than the face value)
- Junk coins can be purchased close to spot price
- Coins are easier to barter in a crisis, giving them high liquidity
- Beware when buying big quantity as it is with coins most gold scams take place, the so-called numismatic coins are by the (scammer) seller pushed as having collectible value when they infact not have. Coin scams are responsible for many investors being ripped-off overy year, sometimes as high as 40-60% (!)
- Easy to stack, store, and transfer larger amounts
- The lowest premium compared with the spot price
- Bars are typically issued with certificates of authenticity
- New bars come sealed and attractively packaged
- Big bars might not be optimal to barter in crisis, giving them high liquidity
- Might lead to flashing on Instagram with your bars (only joking…)
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When is the best time to invest in Gold??
The best time to invest in gold is NOW.
But hold on, you say, why not just wait for the necessity to arise, then invest in gold?
Try asking others how that worked out for them.
Here’s a hint: not well.
It’s what lots of people did in the run-up to and during the 2008-2009 financial crisis.
…And you know what happened? Demand was so great that the mints couldn’t keep up.
Whenever there has been concern about a financial and economic breakdown in the past, there were instances of gold shortages and bottlenecks. At the height of the last financial crisis, premiums shot up on all gold and silver coins and a worldwide scramble ensued.
As the old saying goes, “The best time to invest in gold is when everything is quiet.”
Protect your wealth and explore your gold and silver investment options with the FREE Investor’s Kit from GoldCo, which comes with a one-ounce pure silver coin.
They’ll also include an IRA and 401(k) Rollover Guide so you can learn how to transition your existing accounts into precious metals.
I hope you found this short post about Buying Gold Coins vs Bars to be helpful and that you now have a better understanding of the subject. In the end it all comes down to your own personal preferences and needs, right? Please share your questions or thoughts below in the comment section as I will be more than happy to answer them!
I wish you success!
founder of Gold Retired