As an investor, you may not want to make intangible gold investments such as ETFs and Futures because they do not provide the same security owning the physical asset does. If you are like this, you most likely wish to not just have an investment, you want to be able to feel it, to touch it, to know that you have it stored somewhere.
In this case, you are considering getting physical gold. We bet one of the foremost questions on your mind is “how much is a gold bar worth?” and we completely understand you. Knowing the price of anything you want to buy is among the first things to find out so you can be sure it is something you can afford.
But you can easily find out the spot price of this asset by just checking financial websites that update the daily cost of gold. Meanwhile, there are other things that you have to consider if you have made up your mind to go down this investment path.
In this article, we will be sharing everything you need to know about buying physical gold including what to expect during the process. Let us get right into it.
The Buying Process
One of the easiest ways of buying this asset is buying from online gold retailers. The process is not complex in any way; it’s even as easy as buying a bag online. If you are used to online shopping, gold online shopping should also be a breeze for you. Even if you have never bought anything online, the process is relatively simple so you can get the hang of it quickly.
All you need to do is look for a reputable retailer (always make sure you confirm the reputation of a dealer before you get involved with them) and then choose the product you want to buy. Your selection typically will be based on the amount you want to spend on the purchase as well as the asset’s weight and price.
If you buy a large quantity, you may be offered a discount by the retailer. Sometimes, retailers may give discounts based on payment methods. For instance, some may give a discount when payment is made via wire transfers, while others may give a discount when payment is made via your credit card.
So, you can look out for retailers that will be cost-effective for you based on the payment method you wish to use.
Another place you can buy your physical gold is on eBay. This is a lot trickier than simply buying the asset online. Because even though it is still an online purchase, there are more dishonest sellers on eBay. Therefore, you need to take extra precautions if you choose to do this. Ensure you read reviews about the seller.
If the seller has several negative feedbacks about their authenticity, handling, and shipping fees do not patronize them at all.
If you are in cities like Dubai and Las Vegas where Gold-to-Go vending machines are available and you don’t want to buy the asset in a large quantity, you can use the machine to make your purchase. You can watch this video at https://www.youtube.com/ to learn how to use one of these vending machines. However, this may not be among the top best ways to buy this asset because the price on these machines is usually a lot more than the asset’s spot price.
Consider the Size
When buying this asset, you need to consider the ease of liquidating it when the time comes. One thing that affects this asset’s liquidity is its size.
If you buy a really big size, you may find it hard to liquidate it when you want to. So, instead of buying big sizes, buy more bars in smaller sizes.
For instance, if you want to invest 15,000 dollars and the spot price of the asset is 1,500 dollars per ounce, your investment funds will get you 10 ounces of gold. Now, instead of buying a single ten-ounce bar, it would be better to buy ten one-ounce gold bars. This way, selling the bars will be a lot easier than selling one very large bar.
The purity of gold is also very important, especially if you wish to use the bars for investment. Investment gold bars’ purity level isn’t supposed to be anything below 99.5 percent.
Furthermore, bars bought for investments need to have their manufacturer’s name, purity, and weight stamped on them.
How to Avoid Getting Ripped-off
As we have already said, you need to do your due diligence before you buy gold from any retailer, whether online or offline.
You need to be sure of the dealer’s reputation before you entrust your money to them. Instead of basing your choice on the reviews you find on the retailer’s website, consider reading reviews about them on 3rd party review sites like Better Business Bureau.
A reputable seller must not hide any of the fees needed for the transaction. If they are being shady about cost, then they most likely want to hang some hidden charges on you.
Before settling for a retailer, be sure to shop around first. Retailers need to make profits from the deal, so their prices most likely won’t be the same as the spot price. However, you still need to know the spot price so you can discard retailers with a very large profit margin. You can visit here to find out the current gold spot price.
Buying physical gold goes beyond just knowing the cost of the asset. You need to consider other factors like purity and size to ensure you do not make a bad investment. Also, before you buy this asset from anyone ensure you do your due diligence to avoid getting ripped off.