If you want to move a portion of your financial assets into gold, there are several ways to do it. Gold can be a solid segment of your investments, but buyers need to know what the current price of gold is in order to know how much overage they are paying in mark-ups and dealer add-ons.
Generally, if you buy gold without fancy packaging and directly from mints or wholesalers, you’ll pay less than if you buy from retailers or the post office (because the gold has changed hands twice, and the middleman had to be paid). Also, the more gold you buy, the better the price. As your volume increases, the retail price should go down.
Make sure you know the percentage you are paying over the current market price for any gold, so you can tell how long it will take you to recoup the fees added to your investment.
If you want to add gold to your portfolio, here are several ways to do it:
1. Buy gold bars. In some countries, such as Switzerland and Argentina, you can buy gold bars over-the-counter at local banks. You can also purchase bars from bullion traders. Once you have purchased gold bars, you can keep them in a personal safe or store them in a bank vault.
2. Buy gold coins. Several countries mint one-ounce gold coins, including the American Gold Eagles and Buffalo, Canadian Maple Leaf, Chinese Panda and the South African Krugerrand. They each contain exactly one troy ounce of either 22- or 24-karat gold. The U.S. Eagle coins, among others, also come in smaller denominations down to one-tenth ounce.
3. Invest in mining companies. Another way to invest indirectly in gold is to buy shares in the companies that mine it. While the price of the shares will not always go up as the price of gold goes up, it often will.
4. Invest in ETFs. Buying share certificates that represent gold is an increasingly popular strategy. Investors don’t have to worry about the safety of storing actual gold, but they do pay a small price for trading and for annual storage. GLD is one such popular fund.
5. Open a gold bank account. In Switzerland, for example, you can buy digital gold accounts that “hold” the amount of gold you purchase.
If you are currently investing in gold and want to sell some of your assets, look for a dealer who offers a small premium, usually one percent to two percent, above the market price. Of course, some dealers offer less than full price, and make sure you are aware of any transaction fees that might be tacked on to the sale. You can also sell your gold outright, as many sellers do by listing coins and other gold on eBay.
If you have scrap gold and want to turn it into a little quick cash, here are some important facts to know:
The market price of gold, which can be found at goldprice.org, is based on one troy ounce of pure gold, which is 24 karat. A troy ounce equals just over 31 grams or 20 pennyweights.
Gold that is not pure is discounted according to how much gold it contains. For instance, 10K is 41.7 percent gold, while 14K is 58.3 percent and 18K is 75 percent. If you plan to sell your scrap jewelry, know what karat jewelry you have and what it weighs (preferably in grams).
If you know the weight and how much gold your scrap contains, you can calculate its value and compare it to your offer from the local jeweler, gold buyer, or pawnshop. Check several places before you sell.
When you do your homework before you buy or sell this precious metal, gold can be one of your most valuable assets.
To find a gold-coin dealer near you, visit the U.S. Mint’s retailer locator.
To learn more about investing in gold, visit the World Gold Council .
