How to: Start Investing in Gold
Over the last few months, several people have expressed interest to me about gold. They’ve asked how they should get started. To the novice, investing in gold is pretty scary – they simply have no idea how to get started. The yellow metal is the longest-lasting form of money that we have today, yet few people really grasp where to begin. Hopefully I can help with that, and get a few more budding goldbugs to make the leap.
Only deal with known, reputable dealers
The biggest fear for a new goldbug is getting ripped off. With all the horror stories out there about people “drilled and filled” gold bars and plated tungsten coins, it’s easy to be scared off. Despite the fact that drilled bars are easy to spot, and tungsten coins don’t exist, the fear is real. New gold buyers should only buy from reputable dealers.
One of my favorites is APMEX – short for American Precious Metals Exchange. However, if you’re buying in very small quantities, it may be cheaper to buy from your local dealer. And by local dealer, I don’t mean pawn shop. I mean a reputable coin dealer. If you can buy hocked TV’s in the same place, don’t buy gold there!
Start small
Your first gold purchase should be small, so you can get your feet wet. Consider just a single coin – maybe a $10 American Gold Eagle. That’s a solid 1/4 ounce of pure gold, in 22K form. Why this coin? Well, Gold Eagles are my favorite, of course! They are easily recognized, nearly impossible to counterfeit, and they have their purity and weight guaranteed by the US Government. Since they are 22K, you can handle the coin without fear of damaging it.
Pick up a single $10 American Eagle, and see what you think. It may be just the thing to make you a full-fledge goldbug. Remember – the face value is just for show. A $10 American Eagle is worth much, much more. As of the writing of this article, a 1/4 troy ounce Gold American Eagle will cost you $336 plus shipping from APMEX, though that price changes by the minute.
Don’t Check The Spot Price Daily
While it’s smart to keep an eye on your investments, precious metals are volatile. The spot, or market, price of gold changes constantly. It changes from minute to minute, hour to hour – sometimes drastically. You shouldn’t concern yourself with the day to day fluctuations in price. Precious metals are long-term investments. Treat them that way.
Avoid Collectibles
Also known as “numismatics” or collectible coins. This includes Proof (really shiny) coins, limited edition coins, key dates, error coins, etc. Numismatic coins carry a huge premium over the gold content, which you may not always get back. If you’re investing in gold, invest in gold. Don’t concern yourself with collectibles.
Enjoy Yourself
Gold is a fantastic long-term investment.
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