Are you passionate or even intrigued about coin collecting? Many people nowadays are investing in the things that they love such as wines, stamps, real estate and rare coins. So, if you have a passion for coins, why not turn that into an investment vehicle that could pay massive dividends.
This article will show you everything you need to know about the best silver coins to buy for investment.
Why Buy Silver Coins?
As I’m sure you can image, not all coins are created equal. Some will have large appreciation potential while others will never be more than their face value. Here is a list of reasons why you should buy a silver coins:
- A Tangible Asset. Tangibility means that you can hold it in your hand and that is what you could do with a silver coin, right? Unlike paper bills, they are not easily depreciated because of their wear-and-tear. Silver coins are more durable and therefore, last longer.
- A Store Of Value. Just like gold, silver has its monetary value. As a matter of fact, silver has been a currency for longer than gold is. Even though the price of silver fluctuates, it still has never gone to zero in thousands of years.
- Highly Liquid. Do you know that you can sell silver coins online anywhere in the world? Yes, in fact, there are a lot of dealers in just about every major city on the planet. Moreover, silver coins are still in high demand even during a crisis. So, this will be a good investment nowadays because of the COVID-19 pandemic.
- Free of Counterparty Risk. If you are holding physically, then you don’t need another party to sign a contract or promise. This means that you don’t have default risk unlike investing with stock or bonds.
- Cannot Be Hacked or Erased. There are rampant issues about hacking so it’s totally not a good idea to keep your wealth virtual. So, investing in intangible assets such as silver coins is a far better idea.
- Private and Confidential. If you have an investment, then you know that you need to pay taxes for any gains. However, if you want a little anonymity, then go for silver coins instead.
What Are The Types of Silver Coins?
In investing in silver coins, you must also be aware that there are different types of it. Basically, there are five categories: Bullion coins, Rounds, Numismatic Coins, Semi-numismatic coins, and junk silver.
This type of silver coins simply refers to the ones that are made almost exclusively from precious metal, which in this case is silver. We are talking about highly refined metal which is considered to be investment-grade silver.
The most well-known bullion coins are the ones made by a government mint. These ones are generally referred to as the “sovereign coins” which means that they are both manufactured and guaranteed by the government. Furthermore, these bullion coins come with a face value which is mostly symbolic during this time. However, it is still the silver content that makes them worth a lot more than the figure printed on it.
Furthermore, it is important for you to know that silver bullion coins only have two layers of cost. The first one is its precious silver content and the other one is the dealer premium.
Rounds are silver coins that are made or produced by a private mint. They are usually of good quality and lower premiums compared with sovereign coins. Moreover, they don’t have face value or a government guaranteeing its worth.
There are lots of silver rounds produced all over the world. They can usually be found on private mints and many organizations. Also, if you buy silver rounds, the level of purity is at least at 0.999%.
These are rare silver coins which are usually the ones bought and sold by collectors. Compared with bullion coins, the value of numismatic coins are only partially based on its silver content. Moreover, their premiums are normally higher than bullion coins which can amount to thousands of dollars!
Numismatic coins are like fine art. The coin collectors of this type of silver coin have acquired and specialized knowledge for many years.
Compared to a true numismatic coin, this type of silver coin is made to become collector coins but doesn’t have historical significance. Furthermore, they can or cannot be worth more someday, but they can be frequently bought near bullion prices. Those who have limited mintage are the ones who might be more valuable in the future. One example is the one-ounce Canadian Lynx silver coin.
This type of silver coin refers to the old quarters, dimes, Franklin half dollars, and Morgan dollars which are dated 1964 or earlier. These coins are made of only 90% silver.
US coins of today are made of base metals such as copper, zinc, and nickel. This is the reason why investors are more inclined into buying old coins that were made of precious metal. These coins have previously circulated through the economy and they don’t come new.
One of the advantages of having junk silver is that you could use it for barter. On the other hand, one of the disadvantages is that you will be paid for these coins much lesser than what they would pay you for the sovereign coins.
What Are The Most Popular Silver Coins?
If you are now interested in purchasing silver coins for investment, then check out this list of the most popular ones:
- 1 oz American Silver Eagle
- 1 oz Canadian Silver Maple Leaf
- 1 oz Australian Silver Philharmonic Coin
- 1 oz Silver Australian Silver Kangaroo Coin
- 1 oz Silver Britannica Coin
Turning your passion into an investment is not a bad idea. Silver coins will never lose its monetary value, hence, a good form of investment. Moreover, you might want to check out the book entitled Gold, Silver, and Rare Coins: A Complete Guide by Sam Sommer on Amazon!