Beginners Guide to Investing in Gold Bullion

Posted on May 1, 2018 by in Investing

Beginners Guide to Investing in Gold Bullion

Relying on a pension and your own savings is not a solution anymore, so most people are looking for ways to diversify their income and get the financial security needed for their golden years.

This is why we (still) save money, invest, run small businesses and look at all kinds of ways to become more financially independent, as we get older.

Investing in gold bullion is a great way to diversify your investment.

What is gold bullion?

Bullion is gold, silver, or other precious metals in the form of coins, ingots, or bars. Typically bullion is used for trade on a market. The word bullion comes from the French Minister of Finance under Louis XIII, Claude de Bullion.

The value of bullion is typically determined by the value of its precious metals content, which is defined by its purity and mass. To assess the purity of gold bullion, the centuries old technique of fire assay is still employed, together with modern spectroscopic instrumentation, to accurately determine its quality in order to ensure the owner receives fair market value for it. It is also weighed extremely accurately.

Retailers may sometimes market ingots and bars of base metals, such as copper, nickel, and aluminium as bullion, but this is not a widely accepted definition. (from Wikipedia)

So gold bullion is basically physical gold you own and can re-sell at a later time. It doesn’t spoil, it does keep a high value over time and you can always rely on it, when you need some money.

Even better, you can get people from all over the world interested in your gold, since it’s not a banknote that can’t circulate other than in your own country.

Beginners Guide to Investing in Gold BullionHow much money do I need to start buying gold bullion?

You can buy large gold bars, but these are very expensive, especially if you’re just looking to ‘save’ some money via these investments. In this case buying gold coins, that have no numismatic value (they are just cast for investment purposes) makes complete sense, in this case you’ll just pay the price for the gold itself.

Even few hundred bucks are enough to buy small gold coins and start your bullion coin collection.

If you are good with numismatics (or interested in learning more), you can approach coins with numismatic value as well, since they can be resold for more money than just the price of gold. You need to be careful though, not to spend a lot of money for a coin that seems valuable and is not.

Get your hands on a coin catalog (there are online versions as well) and start studying. The more numismatic knowledge you get, the more great deals you can make.

If this seems too much, just rely on regular bullion coins. You can get them from reliable dealers and keep them for future.

To make it even easier, stick to North American gold coins. Their gold content and purity are guaranteed by the US Mint and can also be easily resold.

Where can I buy gold bullion?

There are various bullion dealers that can provide you with your gold bullion. Just look at the US Mint’s search page and find the best deals for you.

You can also buy on eBay, just make sure to work with reputable sellers and not get caught in bidding wars. You can get some great prices there, but it’s also easy to pay way more for an unit, just because of a bidding that gets out of hands.

Numismatic conventions are also a great place to look for bullion sellers. Usually at the event’s end you can get even better deals.

Look for smaller coins, at least in the beginning, they are cheaper and can be resold faster than a bigger chunk of gold.

How do I store the coins?

There are various coin albums you can use to store your gold bullion coins. These cost very little and keep your values in a great shape.

Such an album ca store tens, if not hundreds of coins and you’d have a safe place for your collection. Here is one of the most reputable sellers: Lighthouse.

As soon as you gather more gold bullion coins and would like to keep them in a safer place, you can get a bank vault and store your treasure there.

Where do I sell gold bullion?

Whether you opted for gold bars or coins, there’s a plethora of options for you to choose from, when you need money and want to sell some of your gold.

You can sell it back to various offline or online dealers (beware, some might not want to buy gold except for the one they sold to you), eBay, Craigslist or numismatic conventions once again.

Have you tried investing in gold bullion? What other advice would you give?

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