How to Buy Krugerrands

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Contributor, Benzinga
December 9, 2022

Want to jump straight to how to buy Krugerrands? You can buy Krugerrands with Birch Gold Group or American Hartford Gold.

Global banks are loading up on gold in record numbers. A recent World Gold Council (WGC) report showed that demand for gold was up 28% year-on-year, reaching 1,181 tons at the end of Q3 2022. Gold has not experienced this level of demand since 1967 when the U.S. dollar was still pegged to gold.

Individual retail investors have become more interested in gold, including gold bars, coins and exchange-traded funds (ETFs). Gold coin trading, especially with Krugerrands, is becoming more popular since it’s one of the easiest ways to own tangible gold without breaking the bank.

This comprehensive guide will show you how to buy gold coins like Krugerrands safely and efficiently without high fees.

What Are Krugerrands?

The South African Krugerrand is one of the oldest national gold bullion coins in the world. Created in 1967, each Krugerrand contains 1 ounce of 22-karat gold along with bits of other metals like copper to ensure durability.

This coin is unique since it’s recognized as legal tender within South Africa, along with its currency, the Rand. This coin has grown in popularity and inspired other national coins like the Canadian Maple Leaf and the revival of the American Gold Eagle coin. 

Brief History of Krugerrands

Krugerrands are popular coins due to their long history, stable values and accessible prices. Some countries including the United Kingdom banned the transactions of these coins when Apartheid was in effect. Despite rocky years, Krugerrand coins have become popular ever since the apartheid ended in 1994.

How to Buy Krugerrands

One of the best ways to buy Krugerrands is via a trusted partner like Birch Gold Group or American Hartford Gold Group. Both of these companies have A+ ratings with the Better Business Bureau and have worked with all types of investors, including celebrities like Bill O’Reilly and Steve Forbes.

Step 1: Open an online account

Both Birch Gold Group and American Hartford Gold Group make it easy to open an online account to trade these coins. Often, these accounts can be created in less than 30 minutes. Both partners have special offers for new investors.

For example, American Hartford Group currently offers free shipping for its gold and silver products. They also include free transit insurance, which protects your precious metals en route to your address.

One perk that Birch Gold Group is offering to new investors is a free 20-page ebook on how to buy gold like an insider. These tips can also show you strategies to legally reduce taxes.

Step 2: Choose the gold coins you want to buy

Krugerrands are available in three varieties, ½ ounce, ¼ ounce and 1/10 ounce. In addition to being able to buy gold Krugerrands, you can buy silver bullion Krugerrands that were released in 2018.

Regardless of the type of gold coin that you purchase, check the weight and composition. For example, Krugerrands have a 92%/8% composition of 22-karat gold to copper.

Step 3: Make your purchase

Both partners require new investors to call during business hours to purchase, trade, or sell Krugerrands to confirm your order, the price and your physical address. 

Unlike stocks that can be bought and sold purely online, physical gold requires extra care since it’s being transported to a physical location.

How to Buy Gold Coins With an IRA

With a self-directed IRA, you can invest in gold and other precious metals in a tax-deferred or tax-free (Roth) basis. Using these types of accounts can help you save taxes and provide special protection, which includes hiring a third party to store and secure your precious metals on your behalf.

Both Birch Gold Group and American Hartford Group have been helping thousands of investors set up Gold IRAs. They also make it easy to sell back your precious metals with no fees.

How to Trade or Sell Your Krugerrands

These partners can help you sell or exchange Krugerrands for similar products. Work with brokers like American Hartford Group that have no buyback fees. Working with these brokers will also prevent you from wasting time and money by needing to sell these coins to outside parties.

Another factor to consider when trading gold or silver within a self-directed IRA are the required minimum distributions (RMDs) that IRAs are subjected to. You’re required to start withdrawing a percentage of your account when you reach age 72. These two companies allow you to sell fractions of your gold to meet but not exceed RMD requirements.

Current Gold Coin Prices

Gold spot prices have been fluctuating between the high $1,700s and low $1,800s over the last week. 

With high demand from central banks and retail investors, gold has room for growth, especially since it’s 10% below its 52-week high of $2,040 in March 2022.

The Gold to Silver ratio is still relatively low at 74.66%, down from 94.33% earlier this year. A lower ratio means that gold is reasonably priced and worth holding long term.

Besides RMDs and high Gold to Silver ratios, consider selling gold if the Dow to Gold ratio is low. The Dow to Gold ratio shows how many ounces of gold it would take to buy one share of the Dow Jones Industrial Average (DJIA) index. Low Dow to Gold ratios mean that gold is potentially overvalued.

The current Dow to Gold Ratio is 19.35.

Are Krugerrands a Good Investment?

It’s no secret that the economy is in a tight spot from turbulent markets. Aside from these points, inflation is still at record highs, meaning that it could make sense to start trading gold coins.

Krugerrands are a user-friendly and affordable way to gain exposure to gold. Working with trusted partners like Birch Gold Group or American Hartford Gold Group can help you buy, sell and trade these coins easily. You can also reduce tax liabilities by opening a Gold IRA with these partners.