How to Buy Gold Coins

Gold coins have long been a symbol of wealth, security, and timeless value. Whether you're looking to diversify your investment portfolio, hedge against inflation, or simply enjoy the allure of owning precious metals, buying gold coins can be a rewarding endeavor.

However, purchasing gold coins requires careful consideration to ensure you're making a wise investment and not falling victim to fraud or overpricing. Understanding the types of coins available, reputable sources, and key factors like purity and market pricing is essential for anyone venturing into the world of gold coin ownership.

This guide will walk you through the steps to confidently buy gold coins and build your collection or investment.

Why Invest in Gold Coins?

Some investors may think it’s easier to research and invest in a gold stock or fund rather than find and purchase a gold coin. While both investment products may provide exposure to gold, they have different advantages and disadvantages.

One of the primary reasons many investors like gold coins is the autonomy they can give over wealth. Gold coins are universally recognized and aren’t necessarily linked to one currency. This investment allows you to avoid reliance on the worth of one country’s currency or a bank. In this way, gold coins offer protection against market downturns and economic uncertainty while hedging against inflation.

Buying and selling gold coins is easy through the many reputable retailers of gold coins online and in brick-and-mortar stores. Plus, there’s a large community of investors to purchase from and sell to. Gold coin investments also have some tax benefits.

Like a stock, if you sell gold coins after holding them for less than a year, the sale is considered a short-term gain, taxed at your ordinary income tax rate. Long-term gains on coins held over a year are subject to IRS-defined collectibles capital gains taxes, which have a cap of 28% depending on income.

Steps for How to Buy Gold Coins

Many investors aren’t sure how to buy gold coins, but it may surprise you how easy they are to find. From banks to marketplaces and TV ads, gold coins are a popular purchase with a large market of buyers and sellers.

Work with Coin Dealers

Coin dealers are businesses or individuals that buy and sell coins. These coins are often high-quality gold or silver or otherwise rare and valuable. You may find a local coin dealer or you can use larger online dealers such as APMEX or JM Bullion.

No matter what type of coin dealer you use, ensure you understand how their coins are valued for quality and purity. Use a third-party appraiser if necessary to guarantee that you are getting your money’s worth.

Order from TV Dealers

Some companies may sell their gold coins via TV ads, and interested parties may have to call or go online to purchase them. Be leary of TV dealers and do your research before purchasing a gold coin from them. TV coin dealers tend to sell coins at higher premiums and include additional hidden costs and minimum order requirements. They may also try and get you to partake in a layaway payment plan that charges you interest.

This may not be the case with all TV dealers, but it’s still best to remain cautious. Ensure they are selling their coins at a fair price and that you understand all costs and fees before purchasing.

Visit Coin Shows

You may find coin shows in your area that attract buyers, sellers, and collectors. These shows can be a great way to market to other investors and collectors and browse rare and valuable coins. It may be a fun outing and a way to connect with the community, but coin shows may not be the best place to shop for investment-grade gold coins.

These shows are often focused on collector’s items, not coins intended strictly for investment purposes. Prices may be inflated beyond the coin’s actual worth compared to online dealers who sell coins at a price equal to their value.

Open a Gold IRA

Gold coins can also be used to save for retirement. Self-directed IRAs allow investors to hold gold and other precious metals within a portfolio intended to be used as retirement income. These IRAs often store precious metals for you, so you don’t need to purchase a safe to store them.

However, gold IRAs often charge higher fees than other IRAs, taking away some of the autonomy provided by holding the gold yourself. But it can be a way to diversify your retirement savings into commodities and preserve your wealth.

Purchase From a Bank

Some banks also sell gold coins, though it’s not very common. The banks that do may also provide high-security storage solutions, so you don’t need to worry about keeping your wealth safe. Be sure to compare the bank’s prices to an online dealer’s, since banks may inflate the premiums of the precious metals they sell.

Online Marketplaces

Some investors choose to buy and sell coins directly to other investors and do this through online marketplaces such as eBay, Craigslist, and Facebook. Investors may be drawn to this option because of potentially cheaper prices, but the risk may not be worth the potential savings. It’s much harder to verify authenticity through online marketplaces, and scams run rampant.

If you choose this route, use extreme caution and conduct thorough due diligence on the seller. If you fall victim to a scam, it’s very unlikely you’ll be able to get the money back. Check their reviews, ask for papers verifying authenticity, and carefully vet the listing before making a purchase.

Compare Online Gold Dealers and IRAs

Before purchasing gold coins, you’ll need to find a reputable dealer. Here are some of the best online retailers of high-quality gold coins.

Best Gold Coins to Invest in

Several countries’ mints produce their own gold coins. They have varying designs, come in a choice of sizes, and are produced with different qualities of gold. When deciding which gold coins to purchase, you’ll want to consider the demand for them among investors as well as their quality. Here are some of the top gold coins for investors.

Gold American Eagle

The American Eagle Gold Coin produced by the U.S. Mint features Lady Liberty on the obverse side and an American bald eagle on the reverse side. The famous design by Augustus Saint-Gaudens is meant to embody the American spirit and is a popular option among gold coin investors.

The American Eagle Gold Coin is made of 22-karat gold and comes in several sizes, including the standard one-ounce and several fractional sizes. Because of its global recognition, it’s easy to buy and sell.

Canadian Maple Leaf

The Canadian Maple Leaf coin, released in 1979 and produced by the Royal Canadian Mint, is one of the highest-quality gold coins you can purchase. It’s made of 24-karat gold and is considered one of the purest bullion coins in the world.

It gets its name from the maple leaf design on the reverse side, a common symbol of Canadian national identity. The Canadian Maple Leaf coins are available in a variety of weights and have worldwide recognition.

South African Gold Krugerrand Coin

The South African Gold Krugerrand Coin was one of the first official gold bullion coins to ever be released and remains popular among investors. It was released in 1967 and continues to be produced by the South African Mint. The obverse side features a profile of Paul Kruger, South Africa’s first president, and the reverse side details a springbok antelope.

It’s made of 22-karat gold and comes in a variety of sizes, up to two ounces. More Gold Krugerrand coins have been purchased than any other gold bullion coin, and there continues to be a strong market for them.

Gold British Brittania

The Gold British Brittania coin was first released in 1987 by the Royal Mint, but from 2013 onward they’re now made of 24-karat gold. The fineness makes them a great choice for investors, and the demand for them makes them easy to liquidate. They have a striking design that depicts Britannia and its monarch. They’re released in several sizes, all the way to 10 ounces.

Chinese Gold Panda Coins

These coins are produced by the People’s Republic of China Mint, and each year features a different picture of a giant panda. They’ve been in production since 1938 and continue to be a favorite among investors. These coins also come in one of the largest weight ranges, starting as small as 1/20 ounce up to one kilogram.

Factors to Consider When Choosing Which Gold Coins to Buy

When buying a gold coin, there’s more to consider than just the price of gold at the moment. A gold coin’s value may also fluctuate based on purity, demand, and condition.

• Finesse: Gold coins are produced with different levels of finesse. Some coins are 22 karat, while others are 24 karat. The higher the quality of the metal, the more valuable it will be. Value is also dependent on weight. For example, a one-ounce coin will be less valuable than a two-ounce coin.
• Popularity: Coin popularity and consumer demand also play a huge factor. A coin may be worth more than the actual value of the gold if there is high demand. For example, certain mints of coins may be more popular among collectors, so they may be willing to pay more than the actual value of the gold.
• Age: Additionally, older coins may be more valuable as they fall out of circulation, and high-quality versions of those coins become increasingly rarer.

Build Your Investment Portfolio with Gold Coins

Gold coins can be a way to expand and diversify your investments with a tangible, fairly liquid asset. Gold bullion coins have an inherent value that is universally recognized, which can make them a great inflation hedge. Plus, it gives you more autonomy over your own wealth.

Coins come in a variety of sizes and can be easily bought and sold. Check out some of the top online gold coin dealers and review your portfolio to see if gold coins would make a good addition to your investments.

Frequently Asked Questions