How do I Buy Gold Coins?

Gold is one of several precious metals that can be purchased as a commodity for investment purposes. It also can be collected if it has been fashioned into something such as jewelry or coins. Gold is sold through various international commodity exchanges in several forms, including gold bars — the traditional image of gold bullion — and the spot or commodity price is published daily in most major newspapers and on many websites.

Modern gold coins that are minted and issued by various governments around the world also are considered to be gold bullion, and can be purchased or sold quite easily. These coins are guaranteed and backed by the issuing government, and usually come as 1-ounce (28.3-grams), 1/2-ounce (14-grams), 1/4-ounce (7-grams), 1/10-ounce (2.8-grams) or 1/20-ounce (1.4-grams) coins. Modern coin values are based on the weight of the coin, which is the amount of gold contained in the coin, and the current price of gold plus a small percentage to cover minting and distribution fees. The range of available sizes means almost anyone can afford to buy one or more modern gold coins.

People who buy gold coins fall into one of two groups, collectors and investors, and they buy for different reasons. Collectors buy gold coins for their beauty and history, and are very concerned about the condition and rarity of the coins they purchase. A collector plans on making a profit if and when he sells his coins, but the joy of ownership is very important to him. The best way for a person to learn how to buy gold coins as an investment or for a collection is by joining online groups and forums frequented by numismatists, or coin collectors. He should read everything he can, ask questions, and learn from the more experienced members of the group.

Collectible coins are normally sold by specialized coin dealers. A would-be collector should find a dealer or dealers who have been in business for many years and have a good reputation among collectors. He should ask other forum or group members for recommendations, and refuse to rule out online gold dealers; there are quite a few very reputable firms that buy gold coins and sell them on the Internet. A new collector should decide what type of coin he can afford to buy, and then get quotes from several dealers to compare. The prices quoted should be fairly close; if one quote is much higher or lower, a person should find out why before buying. Once it is purchased, a person should enjoy the beauty and history associated with his coin.

Investors buy gold mainly as a hedge against inflation and as a safe, liquid investment that appreciates over time and can be easily sold. In the U.S., the most purchased gold coin is the American Eagle, issued by the U.S. Mint. Other very popular coins are the Canadian Maple Leaf, issued by the Royal Canadian Mint, and the Kruggerand, issued by the government of South Africa. A person planning to buy modern gold coins as an investment can buy directly from the U.S. Mint for large purchases or from coin dealers, including large online dealers and local coin shops, for smaller purchases.

Before deciding on a dealer, a collector should do some research. He should look for firms that have been in business for many years and have a good reputation. He should decide what coin he wants to invest in, and get quotes from the dealers he picked. Modern gold coin prices are based on the daily gold commodity price plus a small premium, so the quotes received should be fairly close. If one quote is significantly higher or lower than the others, a person should find out why before making a purchase.