physical gold

[Christina K.]

What's the best way to buy actual gold?
From whom and how does one find it locally?
Is it best to buy eagles, like the book says?
Up to what premium should be paid?

Would really appreciate your help.

[samuraidog]

How about silver? I feel nervous about physical gold because I have nowhere to store it, and it is much costlier to get started with gold. I've got no physical precious metals, but I'm thinking of starting slow and buying some silver Eagles.

Also, where do you guys store your physical gold? In a safe at home, or a deposit box at the bank?

[Ad Orientem]

What's the best way to buy actual gold?
From whom and how does one find it locally?
Is it best to buy eagles, like the book says?
Up to what premium should be paid?

Would really appreciate your help.

Best way to buy gold? Your mileage will vary, but as gold is disaster insurance having at least some in physical is ideal. Coins or small bars work. You will generally get more gold for your money with bars but coins are more recognizable and harder to counterfeit.

From whom and how does one find it locally? I have had good experiences with APMX. But do your own due diligence.

Is it best to buy eagles, like the book says? Umm... maybe. Coins are probably more liquid in a crisis situation. But you are paying up for them. I suggest having an emergency reserve in coins and maybe the rest in small bars. Also Krugerrands are just as well known and reputable as Eagles and generally cheaper.

Up to what premium should be paid? 5%. Shop around. But I would not pay more than 5% above spot for any gold products.

[Ad Orientem]

How about silver? I feel nervous about physical gold because I have nowhere to store it, and it is much costlier to get started with gold. I've got no physical precious metals, but I'm thinking of starting slow and buying some silver Eagles.

Also, where do you guys store your physical gold? In a safe at home, or a deposit box at the bank?

Silver is OK for speculation or a small portion of of an emergency reserve of physical metals. But it's not well suited for the Permanent Portfolio because unlike gold, it is also an industrial metal. This means that there are a lot of factors that can affect its price.

As for storage, you should not be storing it at home. I don't care how many guns or dogs with big teeth you own. Use a bank safe deposit box. They are cheap and MUCH safer than home storage. On limited funds, this is an area where compromise in the name of pragmatism over idealism is sometimes required. Until you have enough money for your permanent portfolio to allow you to buy at least a few coins I suggest just sticking with IAU or GTU (which has been trading at a discount lately).

[Pointedstick]

Up to what premium should be paid? 5%. Shop around. But I would not pay more than 5% above spot for any gold products.

GoldMart has OPM bars at a 1.5% premium:
http://www.goldmart.com/1-oz-opm-gold-bar-in-assay.html

...and Austrian Philharmonics (which are just gorgeous IMHO) at a 2.5% premium:
http://www.goldmart.com/bullion/gold-bu ... onics.html

[Christina K.]

Is it necessary or worth the effort to buy "new" coins (no scratches)? 
I'm buying for the gold weight but I see comments, like, "they're beautiful", so I'm wondering if by due diligence you mean I need to ask about condition too?
I also wonder how you can verify counterfeit?  Is that necessary if buying from the dealers mentioned online?

[Fradika]

Try http://www.goldcoinbalance.com/

hope this helps!

[samuraidog]

Try http://www.goldcoinbalance.com/

hope this helps!

That is really cool 

[greg9840]

My understanding is that gold coins, especially Gold Eagles and American Buffalos, are the most liquid.  That means you could walk into just about any coin shop with a bag of gold coins, and the dealer will buy them.  If you walk in with some random gold bars, the dealer might not want them because he may be afraid they won't sell, plus he might also fear it is counterfeit or has a tungsten core.  From what I have been told, gold coins are almost impossible to counterfeit.  Also, if you live in the US, it probably makes sense to only buy Gold Eagles or American Buffalos because they are the most liquid, by far (any dealer will buy them), and also because those 2 coins alone are exempt from 1099 IRS reporting requirements when you sell them.  I'm not exactly sure what the benefits are of that if you don't cheat on your taxes (I don't), but I guess there could be a SHTF scenario where you would be happy that the sale of your gold coins was not reported to the IRS.