Sometimes some of the most important things in your life started out as a hobby. Like collecting gold, silver and platinum coins, for instance, if you’ve collected enough of these things that they weigh up to about 10 or 30 pounds by the time you’re 60 years old, then you can trade them for an immensely huge sum of money that you can use as retirement benefits as oppose to your standard 401(k). According to numismatists (a term referring to people who collect coins as a hobby), the excitement and satisfaction that they feel collecting gold coins, especially those that have historical value in them, is priceless. Some of them even refuse to sell their collection, because over time it too has created a sentimental value for them.
Why invest in gold coins?
The worldwide spot market price for gold per gram is $39.98 and for an ounce is $1,243.60 (these figrues were gathered at the time this article was written, so it may have already changed, please check for spot market price regularly to be updated). As you can see the spot/melt value of gold is relatively high and is very lucrative to even make a business out of, in case you want to just more than collect gold coins that is. However, collectors gold coins are sometimes valued higher than spot market value for gold! And the reason for that is because of the rarity of the gold coin itself.
It may have once been a possession of a famous US president or some King or Duke in Europe which was minted some 300 – 500 years ago. Whether you just want to pick up a hobby by becoming a numismatist yourself, or you’re looking to make a profitable business from this, you can be certain that you will win in the end.
Things to know before buying gold coins
Of course, coin collecting although viewed mostly as a hobby, it is also an investment and a very significant one at that. In every investment there are certain precautions that one needs to take – the same is true with numismatism. Here are a few things that you need to know before starting your new gold coin collection hobby.
North American Gold Coins has a Good Market Proliferation – The 22-karat American Eagle gold coins dominate the US while the 24-karat Canadian Maple Leaf gold coins has a strong influence outside the United States. There are also other gold coins that you can purchase like the South African Krugerrand, the Austrian Vienna Philharmonic gold coins, the Chinese Panda gold coins and the Russian Roubles and Kopeks; however, it is best to stick with North American gold coins as you will find more reliable coin dealers than those in the international arena.
Compare Dealer Prices – The first thing you should know about buying gold, silver or platinum coins is that the US Mint does not sell them directly, except for the proof sets. So you’ll have to go to this section in order to find gold coin dealers and compare their prices, so you’ll be able to get the best price for every ounce you buy.
Prefer 1-Ounce Purchases – It’s always best to stick with 1-ounce coins rather than those fractional coins, because unlike the one ouncers, these fractional coins carry higher premiums above spot prices.
Don’t Bet on Rare Gold Coins – The hassle of verifying the authenticity of rare gold coins will cost you more than what is necessary. So unless you have that much money to spare, then I strongly advise you to stick with regular gold coins mint.
Uncover dealer buyback policies – It’s best to avoid dealers that charges a high premium price for the gold coins they’re selling. Do your homework and find out about the dealers’ buyback polices and other hidden charges (if there are any).
Beware of Fakers and Fraudsters – You may have already know that brass is very similar to gold in appearance and sometimes, swindlers are also very good at making other metals look like gold. My advice is that you should exercise caution when searching for gold coin dealers and stick to the ones that the US Mint recommends.
What is Gold IRA?
A gold IRA (Individual Retirement Account) otherwise known as the 401(k) is a type of IRA which physical gold or other approved precious metals are held in custody for the benefit of the IRA account owner. The benefit of having a gold IRA is that gold value can rise in a given amount of time, therefore you could get 5% – 30% more from your initial investment compared to regular IRA. However, the ever-fluctuating value of precious metals in the market could also be its weakness, still you can make up for it. Just wait until the spot prices will go up again and then, reap the rewards of your gold IRA.