*This post is not investment advice
Hey all. I'm writing this guide for anyone who has contemplated adding silver to their nest egg. I hate to use the term portfolio because, to me, it implies pieces of paper. That is not what this guide is about. There has never been a easier/better time to get started accumulating silver bullion.
The first thing to keep in mind is there are many different types of silver products. Each has advantages/disadvantages. And, of course, price plays a key role. I encourage everyone interested to buy items you like. It makes stacking that much more enjoyable. The biggest mistake made by new silver stackers is over paying for their bullion. I was guilty of this when I made my first purchase. I have learned a lot in the years since.
As far as price is concerned, "Premium" is the word of the day. The premium is the price you pay over the current spot price of your preferred item.
Bars/Rounds: These are generally produced by private mints and have the lowest premiums. (Some silver bars are produced by government mints).
Junk Silver: Don't let the name fool you. "Junk" is just a term to describe circulated coins with silver content. For the purposes of this guide, we will stick to pre 1965 US dimes, quarters, and halves. The premiums on junk silver fluctuate based on overall silver demand.
Coins: These are produced by governments throughout the world and normally carry a much higher premium.
Collectibles: These items demand the highest of premiums. In my opinion, coin collecting is fun, but also very dangerous as an investment.
I consider coins, bars, rounds, and sometimes junk as solid silver stacking items. Unless you absolutely know what you are doing, stay away from collectible items period!
When doing your due diligence on your initial silver purchase make sure you research all avenues for the absolute, best price of the item you are considering. This would include your local coin dealer, online dealers, and even ebay (with discretion).
Premium price points that I personally recommend and constantly look for:
Bars/Rounds: I have seen some sales where the premiums are close to $0.50US over spot. I typically have no reservations buying at $0.89US or less.
Coins: I only buy US, UK, Mexico, Canada, and Australia minted coins. I personally feel confident that I am getting what I pay for from these country's mints (at least at this moment in time). I will pull the trigger when I can get these coins for less than $2.50US over spot. But, I have also paid over $3.00US, but I really hate to.
*And I never make a purchase unless I can get free shipping.
I cannot stress this enough: Only buy from a reputable dealer!!!! I really hate to recommend any online dealers. I've had great experiences with all the ones I have dealt with. If you have a question about a certain dealer, just ask me and I'll tell you if I have ever dealt with them and how my experience was.
Ebay: This is a double edged sword in my opinion. Many reputable precious metal dealers now use Ebay and they do run good specials sometimes. Just be very weary. Always research the seller!!!
One last personal tip: Dollar Cost Averaging
Most people new to the silver market feel the need to jump in with both feet. I know I did. I suggest that you start out slow. In my opinion, silver is a long term investment. Most people new in the silver market go "all in" when they feel the silver price has bottomed. The silver market is extremely volatile! I always say, "If you want silver prices to drop, just let me make a purchase." Because this happens to me every time. The best way to remedy this is to dollar cost average. This basically means to buy a little silver, consistently over time.
Using this technique, I never worry about the spot price. Sometimes I pay a higher price and sometimes I luck out and get a lower price, but I'm never left unexpectedly "holding the bag". Slow and steady wins the day, right? Just remember.....
For me, stacking silver is both fun and rewarding. I get to exchange worthless paper (and mostly computer generated digits) for something beautiful, useful, and tangible. Hopefully this guide will be easy to understand and answer some questions. Please feel free to ask any other questions in the comments. I will do my best to answer them.
*This post is NOT investment advice, just a guide
A lot of people have mentioned for years silver is about to explode. I do own Thousands of dollars worth of silver and I will continue to collect little by little. Now that a lot of the manipulation has come out, I am a bit more hopeful. Nice Post BTW!
Thank you very much @omni-invester! I too, have been steadily accumulating over the past several years. Not sure about what will happen with the price. Hopefully you are correct, but how long have we been hearing that? hehe. I'm thrilled that we have been seeing extremely strong support above the $16US level. Works for me, and definitely a start. I think there are a lot of people still feeling the burn after the last run up in 2011.
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