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Buying Gold at Spot Price &#; Your Guide to Investing on a Budget
One of the most common questions we receive from gold investors is, &#;how can I buy gold at spot price?&#; We all want to save money by paying less for our gold coins and bars, so it makes sense that so many gold buyers want to learn how to find low premium gold for close to spot.
Buying gold at spot price is usually not possible. To keep their businesses profitable, dealers add small fees called premiums to the price of the gold bars, coins, and jewelry they sell. Buying gold at spot price is difficult because all gold items are traditionally sold with at least some premium over their melt value in pure gold.
Although buying gold at spot price isn&#;t possible, investors who know how to identify the low-premium gold products can buy gold at close to spot price. Taking advantage of discounts and deals from leading gold dealers can also help you cut down on premium fees and get as close to spot price as possible for your next investment.
While it&#;s irregular to find gold listed at spot price, this page will give you the tools you need to learn how to buy gold near spot price.
Is it Possible to Buy Gold at Spot Price?
Finding gold listed for spot price is a gold investor&#;s biggest dream. To some gold stackers, premiums are wasted money. When you pay a premium for a gold coin, you&#;re spending more money for the same amount of gold. Unfortunately, precious metal premiums are a fixture of the gold industry, so don&#;t expect to find gold coins or bars listed for spot price often!
How can you buy gold close to spot price? It is sometimes possible to buy gold at or close to spot price, especially if you know how to find the most cost-effective gold products. Gold dealers also occasionally offer limited-time deals on gold coins and bars, cutting premiums to help investors build their portfolio while paying close to spot price for each item they buy.
What Does &#;Spot Price&#; Mean?
To understand why buying gold at spot price is generally not an option for investors, you&#;ll need to know what the term &#;spot price&#; means.
What does gold&#;s spot price mean? The current spot price of gold refers to how much money it would cost to buy one troy ounce of pure gold bullion. Gold&#;s spot price is fluid and can go up or down daily, so the value of a gold coin or bar is constantly changing.
Gold&#;s spot price can be misleading because it measures the value of gold itself and does not account for the additional value created when a gold product is minted. Obviously, a beautiful coin that is made with one ounce of gold is worth more than one ounce of pure liquid gold.
The difference between the spot price of gold and the value of a gold coin or bar is called a precious metal premium. Precious metal premiums are applied to all gold products, and premiums make it impossible for most investors to buy gold at spot price.
Gold Premiums Explained
What is a gold premium? A gold premium refers to a small (or large) fee added on top of a gold coin or bar&#;s melt value in pure gold. Gold premiums are paid by the buyer and tacked onto every gold product a company sells.
Like any other product, gold coins and bars cost money, labor, and time to create. Because of these costs, finished gold items like coins, bars, or pieces of jewelry are sold for more than the current melt value of the gold they contain. Premiums are not unique to the gold industry &#; you pay a premium over market value for nearly every product you buy.
Gold premiums vary from product to product based on a number of factors. Supply and demand dynamics play a vital role in determining how much of a premium is likely to be added to the melt value of a gold coin or gold bar. Different dealers tend to charge different premiums for each of their products, since some dealers have access to cheaper suppliers than others.
Let&#;s get back to the point. Gold premiums are the reason that it is not possible to buy gold at spot price. But because premiums vary from product to product and from dealer to dealer, smart investors can often buy gold at close to spot price.
How to Buy Gold at Close to Spot Price
We know that buying gold at spot price is a dream that most investors will never realize. But dedicated gold buyers who want to save money still have hope. To buy gold near spot price, you&#;ll need to do four things:
Identify low-premium gold products.
Consider &#;Any Condition&#; gold coins and bars.
Think about buying large gold bars instead of smaller ones.
Compare prices across multiple dealers.
Research is your best friend, especially if you want to find the best deals on gold bars and coins. Surprisingly, very few gold stackers understand which products provide the best value &#; and which gold coins are sold at absurdly high premiums over spot price.
Lowest Premium Gold Coins and Bars
Premiums are unavoidable when investing in gold, but all gold premiums are not created equal. In fact, certain gold products are often sold at considerably lower premiums than others. The best way to buy gold at spot price (or close to it) is to compromise on condition/mint and focus on large gold bars.
Before you settle on your next investment, you&#;ll need to decide between gold coins and bars.
Gold Coins Versus Bars: Which Type of Gold Has Lower Premiums?
For the budget investor who wants to buy gold at spot price, gold bars are the better choice than gold coins. Gold coins are beautiful, intricate, and come packed with quite a lot of production value. While this makes gold coins perfect display items to show off to your friends, high production costs also make them an expensive way to invest in gold.
Gold bars are often sold at considerably lower premiums compared to gold coins, making them a good option for buying gold near spot price. There are exceptions to this rule, since some gold bars feature beautiful designs or are rare enough to justify a high premium fee on top of melt value. For the most part, expect gold bars to be consistently cheaper to buy than gold coins.
We know that gold bars are usually the easiest way to buy gold near spot price, but budget-conscious investors can save even more money by compromising on the condition of their bars.
Tip: Compromise on Condition to Save Big on Premiums
For both gold coins and gold bars, condition plays a significant role in determining a gold product&#;s value. A brand new gold coin in Brilliant Uncirculated (BU) condition will almost always be more expensive than the same coin in poor condition. The same is true for gold bars, which illustrates a great opportunity for gold stackers who want to buy gold for near spot price.
&#;Any Mint, Any Condition&#; (AMAC) gold bars are bars that are shipped in a random condition and can come from any mint. Many gold dealers sell AMAC gold bars to get rid of excess stock and may offer great deals to liquidate these gold bars. By sacrificing a bit of aesthetic appeal, investors who buy low-condition gold bars can save hundreds of dollars in premiums.
Buying gold bars in less-than-perfect condition is one of the best ways to buy gold at spot price. These bars may not be brand new, but they&#;re still made of pure gold. If getting as much gold as possible for your money is your goal, then low-grade gold bars are a great choice.
The size of a gold investment also helps dealers decide how large of a premium over spot price they should charge.
Large Gold Bars &#; A Low Premium Option For Investors
Did you know that large gold bars are usually a better deal than small bars? All gold bars are sold at a premium over melt value, but premiums tend to decrease as the weight of a gold product increases. A 1 kilo gold bar may be more expensive than a 1 gram gold bar, but the percentage of your investment paid as a premium is much lower for a 1 kilo gold bar than smaller models.
It sounds counterintuitive, but it&#;s true. One of the most effective ways to buy gold near spot price is to invest in large gold bars. Big gold bars present a liquidity problem, but saving up for a large bar can shave hundreds of dollars off of your premium fees.
We&#;ve focused mainly on how to find the lowest premium gold products, but the dealer you choose to do business with plays an even more important role in determining how much of a deal you&#;ll receive on your next investment.
Compare Dealers to Find Gold Near Spot Price
For the most part, no dealer sells gold at spot price. If you shop around for the right gold distributor, you can still save quite a bit of money. Some gold dealers offer special promotions or discounts that allow investors to buy gold coins or bars for close to spot price. As a general rule of thumb, we don&#;t recommend ever buying from the first gold dealer you see online.
Are you interested in learning more about Pure Metal? Contact us today to secure an expert consultation!
Instead, spend some time comparing gold dealers to find the best price for your favorite coin or bar. It may take some effort, but you could end up saving yourself quite a bit of money by doing your research before buying.
Final Thoughts: How to Buy Gold at (Near) Spot Price
All gold investors dream of being able to buy gold coins and bars for spot price. Here&#;s the reality: buying gold at spot price is almost never possible. All gold products are sold at some sort of premium over melt value, so you&#;ll always pay at least a little bit more than a gold item&#;s gold content is actually worth.
With a little bit of research, it is always possible to find gold coins, bars, or even jewelry for close to spot price. To buy gold near spot price, consider buying large gold bars in less-than-perfect condition. And, as always, be sure to shop around at multiple online dealers before settling on your next investment!
You might also be interested in:
10 Tips for Saving Money on Jewelry
Lifestyle
Shopping
Jewelry is magical. It can warm one&#;s heart, make a statement, or remind a special someone of a cherished moment. Jewelry also tends to be expensive, especially if you&#;re buying fine jewelry with precious metals and gemstones. Because of the expense, it&#;s important to shop wisely to ensure you&#;re getting the best deal, or employ some clever workarounds to save on pieces that would otherwise top out your budget.
Here are some ways to save.
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Here are some ways to save.]]>
Prices can vary widely from big retailer to small, so do your homework before making a purchase. Start by searching online. If you find pieces in your budget that appeal to you, go to see them in person, if that&#;s an option.
If your timing is flexible, you may find a better deal at these times:
&#; Black Friday and Cyber Monday: this can be a good time to hunt for sales on jewelry as retailers may offer sales for the holiday rush and a spike in matrimonial engagements.
&#; Valentine&#;s Day: Check for deals in-store and online in the weeks before Valentine&#;s Day when engagements and jewelry gifts are at a high.
&#; Mother&#;s Day: Whether you&#;re shopping for mom or yourself, keep an eye out for deals in the weeks leading up to Mother&#;s Day.
Prices can vary widely from big retailer to small, so do your homework before making a purchase. Start by searching online. If you find pieces in your budget that appeal to you, go to see them in person, if that&#;s an option.While your instinct may be to shop in-store for jewelry, high-quality pieces can also be found online, sometimes at discount prices. While you have the disadvantage of not being able to examine items in person, you also don&#;t have a salesperson who could potentially upsell you. When shopping online, research any unfamiliar sellers by Googling reviews, using a site like Trustpilot for reviews, or checking the Better Business Bureau for any complaints.
shopping online, research any unfamiliar sellers by Googling reviews, using a site like Trustpilot for reviews, or checking the Better Business Bureau for any complaints. ]]>1
The American Gem Society and the Gemological Institute of America are two of the most reputable gemology organizations in the US. The American Gem Society is a jewelry trade organization dedicated to protecting consumers while the Gemological Institute of America is a nonprofit educational institution that trains appraisers and professionals in the jewelry industry. If you&#;re buying an expensive piece of jewelry, ask whether the piece is certified by the AGM or evaluated by the GIA.
Once you&#;ve made a purchase, you can take your new piece and the written details to an independent appraiser who is qualified to assess your jewelry. This is essential if you plan to insure the item.
The American Gem Society and the Gemological Institute of America are two of the most reputable gemology organizations in the US. The American Gem Society is a jewelry trade organization dedicated to protecting consumers while the Gemological Institute of America is a nonprofit educational institution that trains appraisers and professionals in the jewelry industry. If you&#;re buying an expensive piece of jewelry, ask whether the piece is certified by the AGM or evaluated by the GIA.&#; Silver is the least expensive of the fine metals. Keep in mind that silver is also soft so it can scratch easily. Silver also tarnishes so it&#;s wise to have a silver cleaner on hand.
&#; Titanium or tungsten pieces can also be an affordable option and they are popular in the men&#;s jewelry market. Both look very similar to silver and are more durable. Titanium is more lightweight than tungsten, so you may enjoy tungsten&#;s weight if you want something that feels more durable and expensive.
&#; White gold is a mixture of pure gold and other metals. Jewelry that is pure gold tends to be higher in price, so you may save by choosing white gold instead.
&#; Silver is the least expensive of the fine metals. Keep in mind that silver is also soft so it can scratch easily. Silver also tarnishes so it&#;s wise to have a silver cleaner on hand.
&#; Titanium or tungsten pieces can also be an affordable option and they are popular in the men&#;s jewelry market. Both look very similar to silver and are more durable. Titanium is more lightweight than tungsten, so you may enjoy tungsten&#;s weight if you want something that feels more durable and expensive.
&#; White gold is a mixture of pure gold and other metals. Jewelry that is pure gold tends to be higher in price, so you may save by choosing white gold instead. ]]>1
&#; Karats are a unit of measurement indicating the proportion of gold in a metal out of 24 parts. So, pure gold, or 100% gold, is 24 karats. If a gold ring is 18 karats, for example, then the ring is made up of 75% gold and 25% other metals like copper. (That&#;s 18 karats divided by 24.) Higher karats will naturally be more expensive. The untrained eye can&#;t distinguish the difference in karats at a glance, so you can save money by purchasing lower karats.
&#; Carats, on the other hand, are a unit of weight that measures the actual size of a gemstone like a diamond. But don&#;t let a higher carat diamond be an indication of value alone! Gemstones differ from precious metals in this way. Diamonds, for example, are also graded on color, cut, and clarity. The price of a diamond may increase with greater carat size, but it may be a lower quality diamond than a smaller one with more pure color, cut, or clarity. In other words, sometimes you can spend less for a higher quality piece when you consider all the factors that go into measuring a gemstone&#;s caliber.
&#; Karats are a unit of measurement indicating the proportion of gold in a metal out of 24 parts. So, pure gold, or 100% gold, is 24 karats. If a gold ring is 18 karats, for example, then the ring is made up of 75% gold and 25% other metals like copper. (That&#;s 18 karats divided by 24.) Higher karats will naturally be more expensive. The untrained eye can&#;t distinguish the difference in karats at a glance, so you can save money by purchasing lower karats.
&#; Carats, on the other hand, are a unit of weight that measures the actual size of a gemstone like a diamond. But don&#;t let a higher carat diamond be an indication of value alone! Gemstones differ from precious metals in this way. Diamonds, for example, are also graded on color, cut, and clarity. The price of a diamond may increase with greater carat size, but it may be a lower quality diamond than a smaller one with more pure color, cut, or clarity. In other words, sometimes you can spend less for a higher quality piece when you consider all the factors that go into measuring a gemstone&#;s caliber. ]]>1
&#; Diamonds tend to be the most expensive of the gemstones, but they&#;re also the most common. If you want something that stands out from the crowd for a better value, consider pieces with a different gemstone.
&#; Rubies, sapphires, and emeralds are much cheaper than good diamonds. Take it a step further and get a garnet piece as a less-expensive alternative to ruby. The same can be said of a peridot piece instead of an emerald, a moonstone instead of a pearl, or a zircon instead of a diamond. (Zircon is not to be confused with cubic zirconia which is synthesized.)
&#; If diamonds are a must, consider lab-grown over natural, as lab grown prices are more stable and less expensive. A lab-grown diamond may sound less romantic than a natural diamond, but they have the same look and feel as an earth-mined diamond, and they have almost identical chemical structures. More importantly, many natural diamonds are unethically sourced.
&#; Diamonds tend to be the most expensive of the gemstones, but they&#;re also the most common. If you want something that stands out from the crowd for a better value, consider pieces with a different gemstone.
&#; Rubies, sapphires, and emeralds are much cheaper than good diamonds. Take it a step further and get a garnet piece as a less-expensive alternative to ruby. The same can be said of a peridot piece instead of an emerald, a moonstone instead of a pearl, or a zircon instead of a diamond. (Zircon is not to be confused with cubic zirconia which is synthesized.)
&#; If diamonds are a must, consider lab-grown over natural, as lab grown prices are more stable and less expensive. A lab-grown diamond may sound less romantic than a natural diamond, but they have the same look and feel as an earth-mined diamond, and they have almost identical chemical structures. More importantly, many natural diamonds are unethically sourced.
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&#; Just because a piece of jewelry is used doesn&#;t make it any less beautiful. And you&#;re giving a new life to a gem that was procured long ago.
&#; Many jewelry shops sell both new and vintage pieces, so ask to see both.
&#; Antique stores are another resource, as are auctions and estate sales.
&#; When buying used, ask if certifications are available. They aren&#;t always, but it&#;s good to ask. You can also ask whether it&#;s possible to hold the funds in escrow while you have the jewelry appraised.
&#; Just because a piece of jewelry is used doesn&#;t make it any less beautiful. And you&#;re giving a new life to a gem that was procured long ago.
&#; Many jewelry shops sell both new and vintage pieces, so ask to see both.
&#; Antique stores are another resource, as are auctions and estate sales.
&#; When buying used, ask if certifications are available. They aren&#;t always, but it&#;s good to ask. You can also ask whether it&#;s possible to hold the funds in escrow while you have the jewelry appraised.
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If you don&#;t have the budget for the real deal, there&#;s no shortage of fashion (or costume) jewelry out there. And if you really want to make a statement, you can go big without breaking the bank!
Tips for saving on fashion jewelry:
&#; Shop around holidays like Christmas, Valentine&#;s Day, or Mother&#;s Day when costume jewelry is promoted as a gift item. Look for Black Friday and Cyber Monday deals as well when most major retailers host savings events.
&#; If you shop online, it&#;s easier to compare prices from a wide array of retailers online. Look for sale sections that offer even lower prices on costume jewelry. Belk, for example, has a clearance section on its site with thousands of pieces.
Pro Tip: Try to pair your online purchase with a coupon from a deal site, like RetailMeNot or Rakuten.
Also, be very mindful of the size of items as viewing jewelry online can be deceiving. Look for photos on models instead of product photos alone.
If you don&#;t have the budget for the real deal, there&#;s no shortage of fashion (or costume) jewelry out there. And if you really want to make a statement, you can go big without breaking the bank!
Tips for saving on fashion jewelry:
&#; Shop around holidays like Christmas, Valentine&#;s Day, or Mother&#;s Day when costume jewelry is promoted as a gift item. Look for Black Friday and Cyber Monday deals as well when most major retailers host savings events.
&#; If you shop online, it&#;s easier to compare prices from a wide array of retailers online. Look for sale sections that offer even lower prices on costume jewelry. Belk, for example, has a clearance section on its site with thousands of pieces.
Pro Tip: Try to pair your online purchase with a coupon from a deal site, like RetailMeNot or Rakuten.
Also, be very mindful of the size of items as viewing jewelry online can be deceiving. Look for photos on models instead of product photos alone.
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&#; Hang onto your jewelry. After all, it doesn&#;t take up much space! Trends are always changing and those Peter Pan necklaces you bought a few years ago will come back around.
&#; Look at social media or in fashion magazines for ways to wear your pieces differently by layering, attaching pieces together, or wearing items in a different way, i.e. wearing a necklace as a wrap bracelet.
&#; Ask a relative if they have old costume pieces that they no longer wear. You never know what kind of treasures lay in wait at the bottom of a jewelry box.
&#; Mix and match. Layer fine pieces with costume pieces. No one will be the wiser!
&#; Hang onto your jewelry. After all, it doesn&#;t take up much space! Trends are always changing and those Peter Pan necklaces you bought a few years ago will come back around.
&#; Look at social media or in fashion magazines for ways to wear your pieces differently by layering, attaching pieces together, or wearing items in a different way, i.e. wearing a necklace as a wrap bracelet.
&#; Ask a relative if they have old costume pieces that they no longer wear. You never know what kind of treasures lay in wait at the bottom of a jewelry box.
&#; Mix and match. Layer fine pieces with costume pieces. No one will be the wiser!
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