The concept of purchasing gold as an investment has taken off in recent years. With the volatility of the global economy, more people are choosing to invest in physical gold instead of stocks and bonds. If you're new to the concept of buying gold as an investment, here are some helpful tips to consider before you pay a seller your hard earned money.
Buy By The Ounce
Some gold sellers offer something known as "fractional" gold, which means it's sold in much smaller sizes than a full ounce, such as a quarter-ounce to as small as a tenth or even twentieth of an ounce. The purpose of fractional gold is to use it as a replacement for cash, so if you're buying to invest it won't be as profitable. Another reason to avoid fractional gold is that you'll typically pay a higher or more frequent fee per item for a smaller amount, costing you more money out of pocket in the long run. Try to stick with only buying full ounce bars or coins when possible.
Use A Reputable Dealer
Be aware of quality gold sellers and try to only purchase from dealers with a solid reputation and a good track record. The US Mint sells gold coins and other items all backed by a guarantee so you won't lose your money after you buy your gold. Do your research and ask other investors who they recommend and always check with the Better Business Bureau, as well. It's also a good idea to check the current spot market price of gold per ounce so you know you're getting a fair and honest price. Some dealers may offer bulk discounts or free shipping with a minimum purchase, too.
Don't Get Too Fancy
If you're only buying gold as a means for investment, avoid purchasing beautiful display coins or proof coins. While beautiful, these coins are really meant to serve as a collector's item, and the price will be much higher than a standard ounce of raw gold just above the spot price. Proof coins make a lovely gift or a nice item to display, but you should avoid buying them solely to serve as an investment. Instead, purchase gold bars without any fancy reliefs on them for the lowest price. Regular one ounce gold coins may also be available at a decent cost, but brand new proof collector's coins will definitely cost you more than the standard ounce. With a little bit of research, you can start buying gold, such as from Sheldon Jewelers, as an investment for a profitable future.