- Personal Finance
Gold = Financial Protection
Get Your Hands Off of My Money
The U.S. economy took a dive from 2008, it is still stagnant in late 2012. Of course when economies sag under the weight of irresponsible decisions, other entities try very hard to get your money so their bottom line doesn't suffer. There are numerous culprits trying to get a hold of your money, including local and federal politicians. Let's not forget the multitude of commercial organizations draining your wallet, how about the utilities. So did your cable or satellite bill go up recently? How about the fuel for your car, ratcheting up the prices on a bi-annual rip-off.
If you are lucky enough to have a cash savings account you also notice that the banks know how much you have and likewise so does the government. Banks, Financial institutions are required to report your finances through various programs, most notably your interest earnings. Sometimes this is rather humorous as many financial institutes report the ten cent earnings you made last month on your checking account. Pretty sad wouldn't you say?
Owning gold has no requirements to banks or governments as to their value or location stored. Therefore you can't be taxed on interest earned or the value increase over the years. You can't be taxed on its value when you sell it.
Gold 10 Years
Understanding the Value of the Dollar
The most deceptive forms of taking your money actually occurs due to the inflation factor, but most importantly due to dollar devaluation. We all understand how inflation is due to the rise of prices within our economy. Devaluation causes losses in the value of our dollar by a loss of respect compared to gold and foreign currencies. It is difficult to understand how your dollar isn't worth a dollar, like the stock market, the world opinion makers can influence the value of your dollar from anywhere in the world. All monetary systems are all traceable back to the Gold standard. This standard also includes other precious metals like Platinum or Silver. You are able to measure the strength of the dollar by comparing it against the gold standard.
The gold value right now, December 2011 is about $1750 per ounce. So right now if you had one ounce of gold you could buy 1750 loaves of bread or that ounce would pay for half of your property taxes for that year. Not bad for an single 1 ounce gold coin. The world value of that coin is constant, but it seems to increase in value only because of devaluation and inflation. If you bought that gold coin in 2006 at about $500, you would have avoided the 2008 financial fiasco, the 2010 US election debacle and who knows what is up for us in 2012.
By buying into the gold standard you avoid the financial monkey business that politicians and world powers try to play on us. Notice how the gold price shot up after 2006, no coincidence that our economy took a dive right about this time. The average US citizen controls a very large percentage of the money supply, and the politicians would like nothing better than to get their hands on your money.
Gold Coin Size
Average Premium over Gold Price
Typical Price 12/2011
1/10 Ounce Gold
1/4 Ounce Gold
1/2 Ounce Gold
1 Ounce Gold
Simple Ways to Buy Gold
Buying gold, silver and platinum coins seems daunting at first glance. By sticking to some simple uncomplicated techniques, you too may own gold.
First avoid the street side hand made signs, painted with leftover house paint claiming they buy gold from you. These are businesses that try to get the biggest profit margins by having you bring in your gold watches, rings and other jewelry in trade for dollars. But remember you want to be buying gold right now, not selling it.
The world market for gold purchases do not require any brokers or special analysis of the coin. You can purchase gold coins over Ebay.com and even at your local reputable coin dealer in your home town. Be careful about buying from the numerous online dealers, they are reputable businesses but they will charge you a premium in broker and delivery fees. You also want to own the coin, admire it, then keep it in your safe deposit box. Some outfits offer a certificate instead of delivering the coins, I prefer to own the coin.
The advertised weight for instance; 1 oz, 1/2 oz is the weight of the actual gold content. All gold coins contain other alloys like copper or nickle, the alloys are introduced to make the coin stronger and able to withstand normal wear. If you were to actually weigh a 1 ounce gold coin it will weigh in a percent or two over 1 ounce. This alloy variance is different from one country to another.
Many countries offer gold coins and all of them are available right here in the United States. They all offer a variety of sizes for the coins from 1/25th ounce to 1 full ounce. The face value on any coin has nothing to do with it's actual value. You will see $20 gold coins as well as $5 gold coins, so don't be confused by the face value. The real value is dictated by the amount of gold in the coin. Also bullion bars are offered in a wide variety from nuggets to large expensive bars, but as a beginner owner, you should study up on bullion gold before buying.
The following countries offer these gold coins:
- United States, Buffalo, Eagle, Liberty
- South African, Krugerrand
- Canadian, Maple leaf
- Austria, Vienna Philharmonic
- Chinese, Panda
- Australian, Kangaroo, Dragon
Always note these key factors when buying gold coins.
- Always be aware of today's market gold price. Check sites like GoldPrice.org or monex.com/liveprices
- Sales commissions range from 3% to over 25%, never pay an excessive commission on today's gold price quote. Remember though, you can also sell the coin at a similar percentage.
- The larger the coin or bullion, the smaller the commission price.
- Be careful that you are not buying gold cladding coins. Most dealers are reputable and will declare if a coin is cladding or solid.
- Most gold coins do not have a premium price on how old it is. Unlike other coins, age is not usually a factor in its value. The exception being the Mint special condition coins, which carry a premium price.
Reselling Your Gold.
Remember that the gold market is very much like the stock market in that it is a risky venture. Frankly, the gold, platinum market is much more stable than the overall stock market. But be aware that any commodity market can take a bad turn and you need to be prepared for and react to a change in the market.
So there you are many years later your gold coins are now almost 50% more valuable than when you bought them. Most likely better than the 10 cents per month paid by the banks on your savings account. Better than the 30% increase in home values before the last housing crash. Reselling your gold can be done as easily as reversing the process you used when buying the gold. Check the current prices of gold and check on Ebay.com to see what the current price is being offered by other coins of the type you own. You can resell it on Ebay and avoid a brokers percentage or go to the local coin dealer and ask for a resell price. They will tack on a broker percentage, so shop around to find your best resell price.
Most importantly enjoy your coins, they are also beautiful to look at and enjoy.
Copyright 2011-2012, Donald Fairchild, Fairchild Software LLC