Buying Physical Gold at Spot Price

For thousands and thousands of years gold has been used as a way to store value as well as be a visible sign of wealth. Nowadays you can find gold in a lot of currencies that are circulated around the world but as this practice becomes increasingly rare, gold is more commonly used as an investment vehicle.

Whether it be gold bars, gold rounds, or various other types of gold bullion, the metal is being consumed and exchanged at a higher rate now than ever before which is clearly seen in the fact that the metal’s value has never been higher than it has been in recent years.

If you are like many and wish to invest in some precious metals, specifically gold, then there are a few things you must be aware of before spending any money. The first of which is how much you should expect gold to cost, whether it be from an online dealer or a brick and mortar dealer.

To find out the cost of gold all you have to do is see what is trading for currently on the open market; this is referred to as the spot price. The spot price should only give you an idea of how much your gold will cost because no dealer, in their right mind, will ever sell gold for the same price it is going for on the market.

Instead, dealers add a premium over the spot value of the gold in order to cover both the costs of business and hopefully turn a profit for themselves, after all, precious metals dealers are in business to make a profit.

This means that your goal as an investor is to purchase gold and silver at a price that is as close to the spot price as possible. In the following few sections we will brief you on all the ways you can invest in precious metals at a price that is as close to spot value as humanly possible.

Get As Close As Possible

Like we said before, buying gold at a price that is equivalent to the spot value is going to be nearly impossible, but instead you should try to purchase for as close to spot value as possible. In order to do that you are going to have to do a bit of shopping and price comparison between both brick and mortar and online dealers.

As you probably expect, not every dealer is going to sell even the same piece of bullion for the same price. Even if the savings you incur are a few dollars here and there, you can be rest assured that those savings begin to add up quickly.

By shopping around you will begin to get a better idea as to which dealers offer good deals and which ones look to take advantage of their customer. Typically, sites that are newer to the industry offer more competitive prices than the sites that have been around for some time.

The reason for this is that the tenured sites have already garnered a loyal fan base for themselves and even if it means spending a dollar or two more, those customers will always buy from the same dealer. While this is a typical practice, it is not a smart one because you should always be looking to get the best deal for your money when purchasing precious metals.

Secondhand Market

One way some investors get their bullion at or even under spot value is by going into the secondhand market and purchasing from individual dealers. This can be done on eBay and other sites like it, but as you probably expect it does not come without its fair share of risks.

Buying from individual sellers is not a bad practice at all if you know what you are doing and are safe about it. One of the first rules of thumb that you should abide by is that if a price or offer seems too good to be true, it usually is. And by this I mean, for example, if someone is selling gold for hundreds of dollars cheaper than its spot value it should raise red flags in your head.

Also, a lot of counterfeiters exist and in order to push their fake products at a high velocity they offer their “gold” for an unbeatable price, and by the time you have figured out that you were a scam victim, they will have already made off with your money.

If you do choose to buy from the secondhand market, another bit of advice that can be offered is that gold should only be purchased by way of confirmed e-wallets such as MoneyBookers or PayPal. By making use of these services you can get your money back (most times) in the case of a scam or counterfeit product.

Wrap Up

At the end of the day, buying gold for a price that resembles its current spot value is going to be difficult. Most reputable sites pay too close of attention to their prices in order for you to take advantage of them and finding a good deal on the secondhand market it not as easy as it sounds.

You need to be a good comparison shopper when buying bullion and by sticking to your guns and doing your fair share of research you will likely end up with a good deal. Unlike any other type product, gold never goes on sale and you will never see buy one get one free sales so it will take your due diligence to end up with a good deal. There are many precious metals dealers out there so finding one that will give you a great deal is not as difficult of a task as it may seem at first.