Gold Coins vs Gold Bullion

Gold Coins vs Gold Bullion

When you decide to buy gold, You must know the difference between, Gold Coins vs Gold Bullion. For starters, you will need to decide what form of gold you want to buy and what purpose it will serve.

This is where it gets interesting. Not every gold coin and gold bullion product is the same. There are many factors to consider, for example, the premium you pay. Gold coins tend to have a higher premium per ounce when compared to gold bullion bars. Gold coins are legal tender and minted by a sovereign government mint, whereas gold bullion ingots for example are minted by a private mint. Sales tax is yet another factor to consider where some states will tax one or the other, and sometimes both.

Gold Coins: A Few Things to Know

  • A sovereign mint with the backing of a sovereign government mints a coin. The coin is minted with the approval of an acting governing body stipulating strict specifications and craftsmanship through its laws. Some popular gold coin mints include The US Mint, The Royal Canadian Mint, and The Perth Mint to name a few.
  • Coins are minted with a date, face value, a symbol or head of state, and the name of the country where minted. The South African Krugerrand does not have a face value but is legal tender and has the full backing of the South African government.
  • Government-minted coins provide you with a world-class asset but will cost you more per ounce. You pay the cost of the gold, and the overhead it took to mint and deliver the finished product to your door. Some mints have lower overhead but still deliver the highest quality products. Some dealers guarantee the lowest delivered price!
  • Every year, the mint will receive approval to mint a coin. Typically, the coins are mass-produced with higher mintages. They are then distributed to a few select government-approved wholesalers globally. Each year most mints will produce limited mintage products that may commemorate a hero or other motifs to honor its national heritage.
  • A coin that is minted by a sovereign government and has a face value, is considered legal tender. However, it would not be practical to use today’s modern gold coin in daily commerce since the face value is much lower than the melt price of the coin. To look at it another way there was a day and time when the face value would have been a good trade for its equivalence in services and goods.  
  • Gold coins are easy to buy and sell. You can take physical delivery and store in a home safe. Another option is a safety deposit box at your local bank. You may also choose to have them stored in a vault here in the United States, or other countries like Singapore, Zurich, or Canada.  The Precious Metals IRA is fast becoming a cornerstone for a vast number of investors who want to protect their assets.

Gold Bullion: A Few Things to Know

  • Gold bullion products are available from a number of world-class mints. These mints are held to the strictest measures for purity and weights standardized by the market makers in the gold industry. Some of our favorite hallmarks include Valcambi Suisse, Credit Suisse, PAMP Suisse, and the Perth Mint.
  • Gold bullion bars and ingots have no monetary face value. The value is determined by the weight and purity of the bar. The more popular weights available range from 1 gram to 1000-gram bars or better known as kilo bars (32.15 oz). Central banks world-wide use 400-ounce bars (12.44 kg). These bars are used for trade and commerce between nations and other central banks.
  • Certified investment grade gold bars and ingots usually include the weight, serial number, metal fineness, as well as a hallmark from the mint. The bar should also include an assay from the foundry that minted the bar that certifies per the specs required be the commodities exchanges for example the COMEX or LBMA. These bars are also referred to as “good delivery” bars.
  • Gold bars and ingots are the preferred choice of bullion buyers who want pure investment grade gold, but don’t want to pay the higher premiums gold coins demand. For many buyers’ gold bullion is a lifelong endeavor and is treated much like a savings account. Whether you decide to gradually accumulate, convert your IRA to precious metals, or buy all at once, gold bullion bars and ingots are a fantastic way to protect and preserve your wealth
  • Gold bars and ingots are easy to store and can take very little space. If your situation permits a good home safe is perfect for storing your gold. If you feel the banks are safe you may like the idea of storing your gold in a safety deposit box. There are several storage facilities world-wide that may also be suitable for our situation.
  • When the time comes to liquidate your gold bullion holdings, we highly advise you source your metals from a reputable dealer. You must also make sure you safely store any paperwork that accompanies the bars when you receive them.

Not many assets on earth can help you protect your wealth like pure investment grade gold. Whether you decide to buy gold coins, or you decide to buy gold bars, you will appreciate the protection and peace of mind you will instantly gain once you take possession.

Scott Hage
Monetary Specialist

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