Best way to get into gold on a budget?

RunnersDad · February 25, 2009 3:56AM

I am thinking that I am going to have between $150 and $200 monthly that I would like to purchase bullion with. In your opinion what is the best way to spend this money. Newer fractional gold, or older coinage in lower grades that will not be priced at as high a premium over spot? Thoughts and opinions are welcome. Thanks.

cars · February 25, 2009 4:03AM

If its for investment purposes Its best to save up until you can purchase in 1 oz increments. Much smaller premium. If you buy 1/10 oz pieces you'll be paying extra $200+ per ounce.

gecko109 · February 25, 2009 4:09AM

<< If its for investment purposes Its best to save up until you can purchase in 1 oz increments. Much smaller premium. If you buy 1/10 oz pieces you'll be paying extra $200+ per ounce. >>

I dont agree with this. I can currently buy 1oz AGEs for right around $65 over melt. I can buy 1/10th AGEs at right around $15 over melt. So while its true that the premium IS higher when buying fractionals, I cannot see it as being an "extra $200+ per ounce" more expensive. Its more like about $85 more expensive on a per ounce basis.

RunnersDad · February 25, 2009 4:14AM

<< 

<< If its for investment purposes Its best to save up until you can purchase in 1 oz increments. Much smaller premium. If you buy 1/10 oz pieces you'll be paying extra $200+ per ounce. >>

I dont agree with this. I can currently buy 1oz AGEs for right around $65 over melt. I can buy 1/10th AGEs at right around $15 over melt. So while its true that the premium IS higher when buying fractionals, I cannot see it as being an "extra $200+ per ounce" more expensive. Its more like about $85 more expensive on a per ounce basis. >>

So I am only doing my self a $20 disservice by going the fractional route versus AGE's per 1oz purchased? That's not too bad.

rgCoinGuy · February 25, 2009 4:17AM

Another option is gold modern commems, these sell for around spot a lot of the time on ebay.

RunnersDad · February 25, 2009 4:21AM

<< Another option is gold modern commems, these sell for around spot a lot of the time on ebay. >>

Like AGE's and Buffalos?

Cladiator · February 25, 2009 4:25AM

If you buy sub 1oz bars instead of sub 1oz coins you can get a smaller premium. Stay away from "collectible" bars like Johnson Matthey, Engelhard, Perth Mint but stuff from reputable companies like Pamp Suisse, Credit Suisse, Sunshine Minting is all available in multiple sub 1oz sizes and most at lower premiums than a comparable bullion coin issued by a government. Sizes such as 1gram, 2.5gram, 5gram, 10gram and 20gram are pretty common. There are also 2gram, and non-metric fractional bars but those tend to carry a bit of collector premium with them.

Apmex currently is selling Pamp Suisse 5gram gold bars for $169.72, well within your stated budget. At that price, and with the current spot of $962.20, you're paying $93.46 per ounce over spot. That's not terrible.

gecko109 · February 25, 2009 4:31AM

<< 

<< 

<< If its for investment purposes Its best to save up until you can purchase in 1 oz increments. Much smaller premium. If you buy 1/10 oz pieces you'll be paying extra $200+ per ounce. >>

I dont agree with this. I can currently buy 1oz AGEs for right around $65 over melt. I can buy 1/10th AGEs at right around $15 over melt. So while its true that the premium IS higher when buying fractionals, I cannot see it as being an "extra $200+ per ounce" more expensive. Its more like about $85 more expensive on a per ounce basis. >>

So I am only doing my self a $20 disservice by going the fractional route versus AGE's per 1oz purchased? That's not too bad. >>

Not quite.....its actually about $85 difference for every ounce of gold you accumulate. Its about $65 premium for a 1oz, and about a $150 premium for 10 tenth ounce pieces. The difference is $85.

rgCoinGuy · February 25, 2009 4:33AM

<< 

<< Another option is gold modern commems, these sell for around spot a lot of the time on ebay. >>

Like AGE's and Buffalos? >>

No, Commems, like these:

Cladiator · February 25, 2009 4:42AM

I'm not a fan of the commems as they don't have the weight, metal type, metal purity displayed on them.

cars · February 25, 2009 4:57AM

<< 

<< If its for investment purposes Its best to save up until you can purchase in 1 oz increments. Much smaller premium. If you buy 1/10 oz pieces you'll be paying extra $200+ per ounce. >>

I dont agree with this. I can currently buy 1oz AGEs for right around $65 over melt. I can buy 1/10th AGEs at right around $15 over melt. So while its true that the premium IS higher when buying fractionals, I cannot see it as being an "extra $200+ per ounce" more expensive. Its more like about $85 more expensive on a per ounce basis. >>

Not everyone can get 1/10 oz gold for $15 over melt, That's not normal in my experience and you can get some gold very close to spot. My statement was worst case scenario of course but still applies.

mkman123 · February 25, 2009 4:58AM

agree with cars. Depending on the area your in, you may be able to get gold at decent prices but in other areas, its way overpriced that 1 oz is a better deal.

Weiss · February 25, 2009 5:32AM

I agree 100% with rgCoinGuy. The 1986 Statue, 1987 Constitution, 1988 Olympics $5 gold coins fit the bill.

They're a great fractional size at about 1/4 ounce (.2418 oz pure gold). They have fantastic designs, they're often available in original mint packaging (great cointainer-type capsules inside velvet cases). And they can often be found on eBay at spot--and sometimes you can even get the companion silver dollar at no cost. It's a great way to buy an affordable, tidy silver & gold package.

They have relatively small mintages and they've been melted by the truckload. They are getting more scarce.

As for not having a purity or weight on them--that's true. But then again neither does any classic (read non-bullion) coin. These are the same weight, size, purity as classic $5 gold pieces.

BBN · February 25, 2009 10:11AM

I agree with modern commems. The 1987 constitutions are another way to accumulate with little premium. The one thing about buying fractional gold with a premium is you can sell them with that same premium usually

TomB · February 25, 2009 10:36AM

I agree with modern gold commems. While these may not have the metal finess or the weight listed on them, they are US Mint produced material in a generally recognized finess and weight that is consistent with "classic" us gold coinage of the half-eagle denomination. They have widespread collector and dealer acceptance, some have terrific designs, and can be found very close to spot at any given day on ebay.

DorkGirl · February 25, 2009 11:03AM

If you only have between $150 and $200 to spend, you have to go 1/10 or 1/20 of an ounce, or only buy once every 2 months. The 1/10 are fun and if you are patient, you can get them for a small premium. I started a type set...(Cladiator's idea that I stole

) of them. They are quite beautiful little dime sized "coins".

You came a little late to the party, they were only about $100 each not long ago and maybe will be again.

You might want to start with some silver, if you don't have much. You can buy a lot more silver for your $100

RunnersDad · February 25, 2009 1:16PM

Thanks for all of your input everyone. I have a fair amount of silver between pre 64 junk coinage and morgan's. I am not against purchasing more, but I think that gold is the far better long term investment if you are looking for a profit. I currently do not own any gold but I do follow the market closely.

I will look into some Commems and smaller fractionals, and proceed from there. I may sell somethings off from the non numismatic area's of collecting that I have to fund the purchase of some AGE's.

cars · February 25, 2009 1:47PM

Good luck and don't forget about Sales Tax. Plays a big factor in your purchase.

illini420 · February 25, 2009 4:12PM

Some of the First Spouse coins can be found for very close to melt. Those are not only US Mint produced, but they are .9999 fine and some of them even have some nice designs.

CoinHusker · February 26, 2009 5:54AM

<< Another option is gold modern commems, these sell for around spot a lot of the time on ebay. >>

Weather11am · February 26, 2009 6:12AM

You might be better off with silver...

OnlyGoldIsMoney · February 26, 2009 7:09AM

<< I agree with modern commems. The 1987 constitutions are another way to accumulate with little premium. The one thing about buying fractional gold with a premium is you can sell them with that same premium usually >>

Thanks everyone for the suggestions. I searched the modern gold commems on ebay today and found a 2007-W Jamestown $5 in a PCGS MS69 holder. After an instant MSN cashback my net cost was $243.80 including free shipping.

jmski52 · February 26, 2009 7:55AM

All of the suggestions thus far will work. Regardless of the scale of your gold purchases, it makes sense to establish a regular plan.

In my case, I save up the cash and wait until I can buy what I like the best. In buying what I like, I get a double benefit - I get the gold, and I also get to have a mini-collection. The mini-collection grows over time, and before you know it you have a nice stash.

lope208 · February 26, 2009 11:26PM

I agree with Illini- Gold Spouse coins, even in 69 and sometimes 70!, can be had for small premiums on eBay
because there are just so many for so few collectors.

I have purchased from Apmex a couple times, and I like them. BUT, if you decide to go the 1/10th oz or 1/4 oz
route from them, be aware that your shipping costs will add up over time and increase your "actual premium" paid
for each ounce.

I have a similar monthly amount that I try to set aside and I find it easier to wait 2 or 3 months and buy at least
a 1/2 oz. coin based on shipping costs. Either an AGE or a Spouse. Plus they are bigger than those little 1/10 oz coins!

Although, if you are able to get a good deal locally from a dealer without shipping charges, by all means do what you feel
is a good deal!

Best way to get into gold on a budget?

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