How To Buy Silver Coins: Step-by-Step Guide
If you’re looking to purchase silver coins, you might be curious where you should begin. Today, there are more avenues than ever for buying silver coins. But with more options come more decisions, and the need for more information on the best way to safely buy the coins you want.
So, what do you need to know before buying silver coins? Here’s a step-by-step how-to guide on buying silver coins.
Stack of silver coins
Step 1: Assess Your Wants or Needs
For some, buying silver coins is part of the process of building out a coin collection. For precious metals investors, it is more of a financial consideration.
Coin collectors will search for particular pieces to fulfill their individual collecting goals. Unlike bullion silver coins, the pricing of collectible coins depends on more than their silver content. Rarity or visual appeal account for most of their value.
Silver proof sets are popular among collectors, for example. This is despite them costing far more than the value of their silver content.
Investors will be more interested in a silver coin's purity, availability, and liquidity. One factor to consider when buying silver bullion for the long term is that only certain coins qualify for inclusion in a precious metals IRA.
SILVER IRAs
Gold and Silver American Eagle bullion coins are specifically mentioned in the law authorizing precious metals IRAs. Government-issued silver coins at least .999 pure are also allowed. The most popular coin for IRAs besides the Silver Eagle is the Royal Canadian Mint's .9999 pure Silver Maple Leaf.
Other eligible coins are the Perth Mint's Australian Silver Kangaroo, the Chinese Silver Panda and the British Royal Mint's Silver Britannia.
SILVER BARS
A large size silver bar
The second-most popular physical bullion investment is purchasing pure silver bars. Silver bars come in many sizes, but the most popular size is the 10 oz bar. Silver bars are produced with an eye of keeping premiums low, but they aren't as liquid as silver coins.
JUNK SILVER
A subset of silver investors opt for obsolete United States legal tender 90% silver coins. Also known as junk silver coins, these pre-1965 coins are bought and sold based on their face value, rather than troy ounce weights. Old silver coins minted in 1964 or earlier had silver content proportional to their face value. This means that the silver content of a silver half dollar is the same as two silver quarters, or five silver dimes.
Junk silver dimes
Because of this, it is easier to multiply the total face value by .715 troy oz, then multiply that by the silver spot price and premium. (It sounds more complicated than it is.)
SILVER ETFs
An alternative to buying physical silver bullion products is buying shares of a silver exchange traded fund. Shares of silver ETFs like the iShares Silver Trust are backed physical silver bullion. ETF shares are traded on the stock market.
This option does not give you a claim on actual physical silver. ETF shares are a financial instrument to give you exposure to movement in silver prices.
Step 2: Evaluate Your Budget
How much can you afford? Only you know the answer to that question, but the best advice anyone can give is to buy the best you can afford. If you’re buying silver coins to of fill holes in your sets or albums, then buy the highest-quality piece you can afford. Not only will you be much more pleased with the decision, but also a nice piece might appreciate in value or hold more of its value over time.
American Silver Eagle bullion coins
Silver investors should heed similar advice. You might pay slightly higher over spot for an American Silver Eagle or Canadian Silver Maple Leaf coin compared to non-monetized silver rounds struck by a private mint. But you’re also sure to find far more ready buyers for popular bullion coins than you may when selling privately minted silver rounds.
Step 3: Shop Around
Now that you know what you’re shopping for, it’s time to find the silver coins you want or need. So, where do you buy them? While there are many outlets that sell silver coins, some may not offer what you want, or at the price you want.
Silver coins for shopping on a budget
It’s one thing to buy silver coins, but it’s entirely another to buy them from the right coin dealer or bullion broker. That’s where you need to do a little bit of homework. One bad deal with the wrong company can leave you paying much more than you bargained for or, even worse, without the goods you thought you were buying. But fear not, there are fantastic silver coin dealers out there, and in the next step, we’ll tell you how to identify them.
Step 4: Seek the Right Silver Coin Dealer
How do you find the best silver coin dealer? The first step is in determining what their credentials and qualifications are. Does the silver coin dealer offer a large and diverse inventory? What about their connections with the world’s leading mints and numismatic organizations? Do they seem to be in good standing in their industry? What about customer service? Is it at least decent? Do they offer a return policy? Do they have a physical address and offer plenty of avenues for communication (phone, mail, email, etc.)?
These may be a lot of questions to throw your way, but they’re questions you’ll be wanting to ask as you look for the best silver coin dealers. Reputable companies will be able to check off most, if not all, of these considerations listed above with a resounding “yes.” It's worth the trouble in finding the right coin dealer. Many unfortunate folks get ripped off buying silver coins through backdoor deals, parking-lot arrangements, and fly-by-night figures who promise good deals “cheap” but are just selling stolen or counterfeit goods.
Step 5: Prioritize Getting the Best Deal
A variety of silver bullion
You’ve done your homework, and you’ve landed on a fantastic silver coin dealer. So, now what? How do you score a good deal with them? First, join their email list. Silver dealers may offer insider deals and other customer loyalty incentives to subscribers.
Even if you’re not on a dealer’s email list, you may be able to save money by buying in bulk, or paying by check or wire instead of credit card. A good place to start is to check the bulk prices on Silver Eagles for sale at Gainesville Coins.
If you’re not sure what type of deals are available to you, reach out to the customer service team and ask! They may even be running an unadvertised special on the specific types of silver coins you want. Don’t worry—you’re not wasting anyone’s time by asking such questions. Professionals at a reputable silver coin store will always be happy to answer your questions.
Step 6: Enjoy Your Purchase!
You did it… You found an excellent silver coin dealer, selected the silver coins you wanted or needed, paid for the order, and now they’re home—they’re yours! Congratulations! But there’s more... What’s next for your coin collecting or silver investing goals? How does this most recent purchase help get you closer to achieving those long-game objectives?
That’s something to evaluate as you plan your next purchase of silver coins. Now that you know who to buy your silver coins from, the next step is deciding what silver coins you still want or need and when you should purchase them. Continue doing your research and keep an eye on silver prices and overall market conditions. And remember that in today’s fast-paced bullion market, the best opportunity to buy your next batch of silver coins might be approaching more quickly than you realize.
Joshua McMorrow-Hernandez is a journalist, editor, and blogger who has won multiple awards from the Numismatic Literary Guild. He has also authored numerous books, including works profiling the history of the United States Mint and United States coinage.
More coin buying guide articles from Gainesville Coins:
Best Silver Coins to Buy: Top 10 List
Best Silver Bars to Buy: The Conclusive List
Top 15 Best Coins to Collect: A Definitive List
What Makes Coins Valuable?: A Complete Explanation
The 3 Best Ways to Buy Gold: A Definitive Guide