How to Buy Gold Bullion

| by Michael Locklear

During periods of challenging economic conditions gold bullion is often an investment that many people turn to. As economies run into difficulties gold generally increases in price. Generally a long-term investment, gold bullion may be handed down as inheritance through the generations.

First it is important to understand exactly what gold bullion is. It is a term that refers to the investment quality of gold. Both coins and bars are different forms of gold bullion. The purity of the gold you purchase can vary from 22 karats to 24 karats . Since the prices of the gold bullion is based on the amount of gold contained within the bar or coin it usually doesn’t matter what the purity is.

How To Buy Gold Bullion Coins

One of your first decisions is on the type of gold bullion that you desire. One ounce gold coins are usually the most popular size. Since they are most commonly used by bullion dealers they are generally the easiest to make trades with. Government mints throughout the world issue gold bullion coins. The most popular with investors are the American Gold Eagle, the Australian Philharmonic, The Canadian Gold Maple Leaf and the South African Krugerrand.

When making your investment in gold bullion coins be certain that you are purchasing only coins of the highest quality. The coins of the highest quality have the greatest value. The more a coin is scratched or worn the lower its value. Coins of value known as “uncirculated” are the only ones that you as an investor should be interested in. Be certain that they are covered in protective cases and are pristine and without fingerprints and scratches. Never handle your gold bullion coins without the benefit of protective cotton gloves. Handling your coins without protection will only reduce their value.

Certified coins are something that you should be very cautious of. Services that do coin- grading , and there are many, encase the coins they certify in plastic. This may just be a trick to get you to pay more money for the coin. Despite the fact the dealers may present you with some sort of certification that one coin is better than the other, the fact still remains that gold is gold. Gem quality uncirculated coins that are indeed genuine and pristine condition will retain its value.

How To Buy Gold Bullion Bars

Investing in gold bullion bars can be another desirable method of acquiring gold assets. They can often be purchased at a reasonably low price per troy ounce. Gold bars are available for investment in several different sizes that range from 1 troy ounce, 10 troy ounces, kilo bars of 32.15 troy ounces and the much larger 100 and 400 ounce bars. Gold bullion bars that are available in sizes less than one troy ounce can also be purchased from some dealers. The industry-standard of .995 fine, is the minimum fineness, and guarantees the highest quality and level of purity.

There is usually a 1% to 3% premium above the spot price of gold charged by dealers and may be an additional premium including your investment price from the mint that produced the bar. This premium may be around 4%. So both premiums may total as high as 7%. As a general rule the larger the bar the smaller the premium.

If desire to do your own research, you can easily search the Internet for the current spot price of gold; it is also available right here on the site on the right sidebar. These prices change daily and in some cases even more than once a day. These are the prices the dealers base their prices on and they change every day. It’s important that you know what the current price is so as to ensure that you receive the best value for your investment. Spot gold prices are always stated in U.S. dollars per troy ounce.

Where To Buy Gold Bullion

Finding legitimate gold bullion dealers that specialize in precious metals is always your best option when purchasing gold bullion. Be sure that you investigate the dealer’s history in the community and that he lists his prices both for buying and selling in a conspicuous manner. You can buy gold bullion from coin dealers but they may not have the quality, quantity, and selection of precious metals specialists.

Since gold purchases over $1000 in value may in some states be exempt from sales tax is important to request any discounts or special deals the dealer may be in a position to offer. Also there may be price breaks if you are making a purchase of large quantities. Others may offer things like special insurance or free shipping and it’s always important to investigate their policies concerning a buyback.

You can also use the Internet to search out the rules on gold bullion purchases on Internet auction sites such as eBay’s Bullion Center. There are also risks involved in buying gold on the Internet through auction so you should be aware of that. You’re trusting someone you don’t know to actually send you the gold that you sent them the money for so it’s extremely important that you know who your seller is before making any final deal also always ensure all of your shipments.

As in any business there always disreputable and dishonorable people who are more than glad to take advantage of unsuspecting customers. Be certain that you deal only with well known, reputable and licensed dealers . Research their background and get references and testimonials from previous customers. Remember of the old adage if it sounds like the deal is too good to be true it probably is. It always pays to have many options and shop around.

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