Help with buying 1oz silver eagles
racecap97
Posts: 58 ✭✭
Me and a friend from work have been talking about buying 1 - 2 silver eagles every time we get paid as a way to tuck a little money away. My friend went to a local coin dealer and bought 1 just to see how things worked there. This shop charges $4 over spot when selling and buys at $4 under. So spot was $32 he picked it up at $36. Is this the way it usually works or are there much better deals to be had? I have also been checking the completed listings on ebay the last few days and it would seem that they sell for around $38-$40 shipped so its even a little higher than what the dealer charges. I'm just not sure how smart it would be to start buying after doing the math. Going by the way the dealer does business a person would have to wait until silver hit $40/oz to just break even. Thats $6/oz more than the highest price silver has ever been. Just to break even! We are new to this whole, stocking up on silver so i'm sure there are a lot of things missing from my thinking so any input would be greatly appreciated.
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Are you looking at the bullion eagles or are you looking at the 2006.07,and 08 W's? It makes a difference. These are the rarer of the eagles and more valuable that the bullion variety that were minted from 1996 to present.
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<< <i>Are you looking at the bullion eagles or are you looking at the 2006.07,and 08 W's? It makes a difference. These are the rarer of the eagles and more valuable that the bullion variety that were minted from 1996 to present. >>
I'm pretty sure they are just regular .999 1oz silver eagles. Nothing special about them. Pretty sure the one that my friend bought was a 2011 date. It was in a clear plastic sleave.
Where does everyone buy theirs? Dealers, ebay, mint, ect.....? How much is reasonable to pay over spot?
If your buying just for bullion value. Get bars, My local is only $1.25 over spot. So, that'll be by far the best value if your not in it for the "coin" value.
<< <i>Me and a friend from work have been talking about buying 1 - 2 silver eagles every time we get paid as a way to tuck a little money away. My friend went to a local coin dealer and bought 1 just to see how things worked there. This shop charges $4 over spot when selling and buys at $4 under. So spot was $32 he picked it up at $36. Is this the way it usually works or are there much better deals to be had? I have also been checking the completed listings on ebay the last few days and it would seem that they sell for around $38-$40 shipped so its even a little higher than what the dealer charges. I'm just not sure how smart it would be to start buying after doing the math. Going by the way the dealer does business a person would have to wait until silver hit $40/oz to just break even. Thats $6/oz more than the highest price silver has ever been. Just to break even! We are new to this whole, stocking up on silver so i'm sure there are a lot of things missing from my thinking so any input would be greatly appreciated. >>
When buying 1 or 2 from a shop, $4 over spot is perfectly okay. Just look them over a bit when you buy them to make sure they don't have any scratches, scrapes, or other conspicuous flaws, especially if you can get them for the same money, since that might affect what you can sell them for later. When selling, you should expect to get at least $1 or $2 over spot or thereabouts. So obviously you don't want to sell them back to the same dealer, and you might even consider eventually offering them for sale on the PCGS Buy-Sell-Trade forum on this website. When selling, you'll get a better deal from some buyers if you explain that you have made a serious effort to select silver eagles without conspicuous flaws. Good luck with it.
I myself like the "W" eagles.
<< <i>My local shop is $5 over spot for ase's. I think $4-$5 for eagles is normal, you'll be paying more on ebay.
If your buying just for bullion value. Get bars, My local is only $1.25 over spot. So, that'll be by far the best value if your not in it for the "coin" value. >>
I don't really mind being into it for the coin value along with the silver value as well because of the fact that if one falls quite a bit suddenly the other might hold a little more value to keep the total value up a little higher. I just wasn't aware that there would even be any coin value at all since its just silver eagle bullion. I thought the whole idea behind the silver eagle bullion coins was that it was legal tender and bullion at the same time. As far as I am aware there is nothing special about regular ol silver eagles unless they're of an acceptional grade or something of the sort.
Where does the spot value come from? If a person can't buy silver for the spot value of it what is the point of following the spot value at all?
Sorry for all the questions as dumb as they may seem, this is definatly not my area of expertise.
You might be better off, instead of buying a coin or two a week locally at full retail, save up and buy a whole roll of 20 on our very own CU BST board or Ebay and try to get closer to wholesale pricing
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<< <i>that dealer is pretty bad ..find a new one >>
Agree. An $8 spread on ASE's is too much. Save your money and when you have enough to buy ten or more, check the BST for much better deals. The reason I said 10 or more is because shipping costs would be inefficient on smaller purchases. Also, consider other forms of silver---small bars, 90% U. S. coins, Morgan/Peace dollars, etc.
Worry is the interest you pay on a debt you may not owe.
"Paper money eventually returns to its intrinsic value---zero."----Voltaire
"Everything you say should be true, but not everything true should be said."----Voltaire
<< <i> Pretty sure the one that my friend bought was a 2011 date. It was in a clear plastic sleave.
>>
If it was a 2011 then he paid a little more than he would have for older ones. The newest year always carries a small premium when they first come out. Silver rounds are another way to get them for close to spot. You may not have the ease of recognition with rounds though. I'd shop around for other dealers, or as someone else said, buy them in a little bigger bulk to knock off some of the premium price.
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<< <i>I myself like the "W" eagles. >>
What are the "W" eagles?
Say you have $150,000 in your 401K, you take out $50,000, the amount that your gaining proffits on in your 401K is now $100,000 so at that point your losing more than your gaining with the silver purchase and the interest your paying back to yourself right?
<< <i>
<< <i>I myself like the "W" eagles. >>
What are the "W" eagles? >>
Eagles from the west point mint that are made for the coin collectors bu the US mint. They are a very
low mintage coin and have only been produced for the years 2006,2007, and 2008 as the mint has not
been able to make them in 2009 and 2010 because law requires them to make bullion eagles to
demand and does not have a enough coin blanks to produce them.
When buying 1 or 2 from a shop, $4 over spot is perfectly okay. Just look them over a bit when you buy them to make sure they don't have any scratches, scrapes, or other conspicuous flaws, especially if you can get them for the same money, since that might affect what you can sell them for later. When selling, you should expect to get at least $1 or $2 over spot or thereabouts. So obviously you don't want to sell them back to the same dealer, and you might even consider eventually offering them for sale on the PCGS Buy-Sell-Trade forum on this website. When selling, you'll get a better deal from some buyers if you explain that you have made a serious effort to select silver eagles without conspicuous flaws. Good luck with it. >>
I agree with the above. I'll add some context. When dealers are buying ASE's they are generally paying $2.25-.$2.75 over spot from the distributors if they buy a while monster box (500 coins). If they buy less then a full box, they will pay more. Having said that, the sell price is reasonable.
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<< <i>When dealers are buying ASE's they are generally paying $2.25-.$2.75 over spot from the distributors if they buy a while monster box (500 coins). If they buy less then a full box, they will pay more. >>
What are they paying when buying from the public?
Worry is the interest you pay on a debt you may not owe.
"Paper money eventually returns to its intrinsic value---zero."----Voltaire
"Everything you say should be true, but not everything true should be said."----Voltaire
So if you're most folks and you borrow from yourself in this way, not only do you stop making your normal contribution (say $500/pay period), you pay it back with after-tax money at say $350/pay period, all else being equal.
I looked into this for other reasons recently & didn't like what I saw.
I agree. Especially if buying a couple a week. There are 2007-W burnished silver eagles at the bay going for 'about' the same as 2011 bullion versions... '06 and '08 will send you back more. The OGP ain't that bad either... check them out.
Pitboss has been all over these for sometime.
edited to add link:
US Mint - American Eagle Uncirculated Coins for Collectors
I am still buying them, I picked up 3 more today. I have also been selling some too . I have been selling mostly 07's and picking up mostly 08's. I have 100's of them in my box at the bank. I take them out of their boxes and it gives me more room in my bank box.
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<< <i>By taking out a loan from your 401k even though your paying yourself the interest aren't you losing more than that by what your not gaining on the amount that you've taken out?
Say you have $150,000 in your 401K, you take out $50,000, the amount that your gaining proffits on in your 401K is now $100,000 so at that point your losing more than your gaining with the silver purchase and the interest your paying back to yourself right? >>
Come on that's wall street hype to keep your money in the system and gain commissions. How much do you have in hand? How much in the bank? The best thing I've ever done was taking out a 401k loan of 20k in 2002 and buying $20 sainti/libs in MS58-MS63 never paying over $450 each (PCGS, NGC, ANACS). Let's do the realistic thing of taking out around $10k a year (2 yr 20k).
Now if you think the stock market going to zoom after getting back to close to the last drop then disregard. The stock market for the last decade been getting to around where we are and then dropping back to a low. I think after QE2 were testing the last low again. That's what I think will happen since we're MUCH worse off then the last 10 years this has started. More of the same putting things off.
Now let's talk how the diversification your 401k. You should have a bond component in it a 401k loan for 10k to replace all or part of it at a interest rate of 4.5% paid to you replaces that since your good for it. It also lets you play the PM markets. So once the years up you've got both all of a sudden. The money coming in $825ish each month is used to dollar cost average. It's not like your 10k is out of the system for the whole year in fact your near half paid within 6 mo so you'll be making more than that 4.5% or less depending on what the market doing. It's very low risk and doesn't effect your credit rating.
If you have little outside of the system I'd get something in hand for bad times. We've been duped on the 401k's IMO the government may take them over paying simple interest in the future, they may tax the crap out of em, or if you have too much saved and not a bum they may just say you don't get SS in the future or drastically reduced. Cover all odds and have some heavy insurance is my opinion. This day and age anyone's guess is good. Now what's a safe investment now days with inflation, currency plunges, and stock market in neutral. The buy and hold days are over if your going to do good in stocks you best trade. The day like trades are the ones making money today and that's not for everyone.
Let's see what did the stock market do from 2002 to present that paying myself interest of a loan paid off in 2004 and me buy gold coins for 450 or less? Well I've done quit well thank you with most of those coins going for $1600 plus now. PM's from here are at least double if they can control it IMO and it'll be multiples of that if they can't.
#1 go to a local coin show. Many areas have a monthly show. If a person doesn't care about which year the eagles are, prices are often competitive on both the buy and sell side.
#2 if the local show schedule doesn't work for you, maybe reconsider the silver eagles all together. Spot +$4 is a reasonable retail price, however, 90% silver can often be bought close to melt value during a rising silver market. Old silver dollars for melt, or old silver halves seem like a decent option. If a person is a coin collector, often times there is the safety net of numismatic value in buying better date coins that are now selling for melt value. So check the prices on 90% silver too when going around to the local dealers. Spreads on 90% may or may not be better than eagles, in your particular area, but it is worth a look.
<< <i>that dealer is pretty bad ..find a new one >>
Define bad. I would say bad is turning a customer off to a dealer who appears to be pricing his ASEs competitively. Hopefully the OP realizes the dealer is not a bad dealer and will return often.
The OP should consider buying his eagles in quantity if possible. Having an investing partner helps. Also, buy on the dips, build your cash until it dips.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Bang for the buck is 90 percent IMO.
<< <i>Also when you pay back a loan to yourself in your 401(k), the loan payments are after-tax money, vs. the contributions which are pre-tax for traditional 401(k)'s.
So if you're most folks and you borrow from yourself in this way, not only do you stop making your normal contribution (say $500/pay period), you pay it back with after-tax money at say $350/pay period, all else being equal.
I looked into this for other reasons recently & didn't like what I saw. >>
Well maybe you can just go to the bank and give them the interest. The "Bird in the hand equals two in the bush" is a good saying.
That's certainly a way to look at it if you were taking a vacation or buying a car but at the end it's converted to an investment in PM's that has the ability to make much more income then let the government do what they will with your hard earned account IMO. There's getting to be more and more people just cashing out seeing where this is leading with our current leadership of helping those that want to be victims instead of those of us that have been taught to save. It's a strange world anymore. I may be better off having everything off grid and looking like a bum the way it's looking
Countries > Investors even the billionaire types, after all they can get the stuff for free if they can't prevent their currency devaluation. They just print more...or make some digits on a computer. This is going to end badly IMO because you have one government working against others and we're not the top performer this century so all bet's are off what the US can do to prevent it.
<< <i>By taking out a loan from your 401k even though your paying yourself the interest aren't you losing more than that by what your not gaining on the amount that you've taken out?
Say you have $150,000 in your 401K, you take out $50,000, the amount that your gaining proffits on in your 401K is now $100,000 so at that point your losing more than your gaining with the silver purchase and the interest your paying back to yourself right? >>
Things to consider:
Is the loan amount taxed as income for the year withdrawn?
Investment options of the 401k
What kind of annual return (or loss) is 401k providing
I would look at the possibility (and tax consequences) of rolling the 401k into a self managed on-line ROTH IRA where there are great opportunites trading precious metal ETFs and mining stocks.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
A tax defer 401k isn't taxed (job loss default - yes) and pre-tax can be taken out without any tax now or anytime(if not presently working for the company then it's hardship). Been there done that.
Investment options of the 401k
Few and far between as safe in most 401k's when that's your wealth plus your house IMO.
What kind of annual return (or loss) is 401k providing
Wake me up when the DOW hit 14k plus agaim. Since 2000 peak we are treading water and if the stock markets climb the US won't be the winner globally IMO
I might add that if the dollar falls you better have the stock maket looking like it's making a major gain since your purchasing power could take a lot of dollars more to buy the same stuff something PM's do well. Let's see in 1913 dollars 20 dollars US is equal to about 60 cents today in purchasing power while that same 20 dollars in gold is worth north of 1300 today. You better have made many times your investment. And before 1974 PM's were fixed to prevent you noticing the loss of the purchasing power of the dollars. Grafts on gold before 1974 is bogus just like the average of the DOW for 100 years when they've kick out every dog (GM recent) to upload with a high flyer. I'll see if I can find the list since the 1800's. Last a checked Pullman cart isn't in business anymore as well as many listed to make these stats in their prime.
I went to the original dealer I was refering too and talked to them. They are selling silver eagles for $3.5 spot. I didn't ask what they were buying back for since it doesn't really make much difference to me at this point. The downside to buying there is that i'll have to pay the Denver tax of 7.5% on top. They will give a discount when buying 500 or more which I will not be doing. I watched the gentleman behind the counter take them out of the tube "very carefully" one at a time, inspect them, then hand them to me for inspection during which they looked perfect to me. When I went to pay for them I found out that they only take cash for the eagles for some reason and I only had my debit car on hand so I did not pick them up today. No big deal I can go back next Saturday. I then went to another "much smaller shop" and asked the man behind the counter what he was selling eagles for and he said he was charging $7 over spot. That was enough for me to move on. After visiting both places the first place is sounding pretty good to me and will probably recieve my purchasing business and that of my friend as well. The only thing I dislike is having to pay the 7.5% denver sales tax. He also told me that when buying 200 or more they would ship them to me and that could save me the 7.5% tax because I do not have a physical address in Denver but I cannot buy that many at once.
The premiums are too high for small purchases, you will be buried in them for a quite a while.
90% seems ideal ...you can get a small mix and see which denominations works best....
Groucho Marx
<< <i>
<< <i>that dealer is pretty bad ..find a new one >>
Agree. An $8 spread on ASE's is too much. Save your money and when you have enough to buy ten or more, check the BST for much better deals. The reason I said 10 or more is because shipping costs would be inefficient on smaller purchases. Also, consider other forms of silver---small bars, 90% U. S. coins, Morgan/Peace dollars, etc. >>
I did talk to him about other 1oz coins, I called them rounds, he called them something else but i'm pretty sure we were talking about the same thing with two different names. He said that they sold then as well for I believe $1.25 or $1.50 over spot. When I asked what the difference was he said that its pretty much just because the eagles are "nicer" coins and more desireable, he said they also cost more for them go get than the non eagles "whatever he called them". They have "maple leafs" and one other one as well. But the cheaper ones are pretty much just for silver content and don't have much collectability to them other than that. He seemed like a nice gentleman and had enough patience to deal with my seemingly dumb questions even with a sizable line forming behind me, hahaha.
Watch what happens on kitco (6 PM eastern) this afternoon to see where prices are heading today. It usually starts out fairly slow until more
countries wake up to the new day. The real test on what is going to happen is when NY opens up at 4 AM eastern time. You can still get some
decent deals on ebay but I know I have stopped selling silver until I see which way the wind is blowing.
only if you let him, by accepting such an offer to be reamed
Liberty: Parent of Science & Industry
<< <i>I myself like the "W" eagles. >>
I ended up picking up a 2005 W eagle proof graded 69 ultra cameo by NGC for $59 shipped on ebay. Nice looking coin.