Gold: Learning about it

So, 33 mm to the nearest mm.

 

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How about this idea...

Buy locally and sell online.

It still helps your local economy but gives you the best deal.

 

Buy online, sell locally
Helps your pocket economy.

 

People often complain that there are fewer and fewer local brick and mortar coin stores in their towns.

The fact is that if you don't use them, you'll lose them. They are a great resource... keep them going!

 

I'd give more consideration to buying PM locally if my state government weren't so obtuse about sales-tax legislation.

If you're going to buy more than 1% of your annual income worth of anything taxable over the course of a year, you come out ahead by buying online from vendors who don't add sales/use tax, then paying the state calculated rate, which amounts to what you'd pay on purchases equal to 1% of your income.

So, paying this way, once you've spent 1% of your income on online purchases, the effective LEGAL tax rate for further purchases is ZERO. And, as a rational buyer, I'll rarely choose to pay 7.5% extra by purchasing locally, even if local prices match online (and they usually don't).

Of course, price optimization isn't everything. I do like to support some local businesses even if it costs me extra, and I do sometimes opt for the speed and convenience of Amazon Prime/Amazon Now, even though both impose sales tax. For bullion purchases, though? Especially for something I intend to flip? I do what my state tax policy incentivizes -- I buy online.

 

In Illinois (where I live) we don't have sales tax on coins. So, there is zero impact to buying them in person vs. online.

 

Yep, and I know many other states have the same policy. Not NC, though. If we did, it would certainly change the equation.

 

I *never* knew that until now. And I thought the ppl at the coin shop let it go because I was always paying cash.
https://thecoinologist.com/sales-tax-state-by-state-breakdown/

 

A lot of times that price is higher. JM Bullion has had the same opportunities.

There are opportunities that I've had. I bought quite a few gold coins from Apmex and JM this year via ebay, however there were tricks I used.

I had ebay bonus bucks offers. Always the 2% (not on bullion, but pre-33 and foreign gold coins) 8% and sometimes 10%. What sucks is this year it goes to 1%

I also paid via credit card and got an additional 2% cash back.

An example - Gold $10 Eagles when I bought were at $636 direct online at Apmex, $653 on Ebay from Apmex. I got a 10% bonus bucks offer, and saved $65.30 per coin, plus 2% cash back on the card - My net cost (after time and effort) was ~$575 per coin.

I ended up with some nice VF $10 Indian Eagles - a 1909-S and a 1910-S for $575ea.

I've done this a few times this year when gold dipped on various gold and silver coinage. Opportunity + Preparation = luck.

 

While some are a great resource, a bunch are not. Frankly, with the kind of service/prices/attitudes I have seen, I am surprised how many are still left.

It's not like that everywhere, but I've only found one or two decent local coin stores in Illinois (the second was good when they opened, but turned more into a place that relied on buying scrap or coins under melt rather than being a place to get coins). Plus, it's tough for the local stores to beat the $15-$35 over spot for a gold Maple, Buffalo, or Eagle that Apmex has offered on ebay over the last few months.

 

I love buying through eBay, but have only done it through APMEX (via eBay) due to my comfort level with them. I have only started to buy back into gold and silver in the last two months but over that time I have seen great deals on eBay on 1 oz gold coins. In the last month, I’ve bought Maple Leafs, Britannias, Philharmonics and Buffalos on average only around $30 over spot (maybe as low as $25 over on one), and I just got a few more ’17 pre-sale American Eagles in the last 24 hours for $35 over spot. I’ve paid with a CC on all of them, received them quickly and they were all in good condition.

My only problem with APMEX is pricing on Libertads is poor, and they do not seem to show up ever on eBay for a deal but I guess I’m just being picky b/c mintages are so low on them.

Big thumbs up on buying these through eBay. You have to be patient and may not get the exact coin you want on a particular day (Eagles vs. Buffalos vs. Maple Leafs, for example), but the deals are worth it.

 

My comment made sound like it's coming from left field but generally I find better gold deals on foreign coins than American bullion. More gold for less money. Of coarse you have to trust the dealer and there is nothing wrong with testing the coin.

 

You are correct. I bought numerous British gold sovereigns this year. I actually got most of them for a few dollars UNDER melt after Ebay bucks and cash back offers. Worst case was $3 over melt per coin for ~100yr old sovereigns. I did get lucky on one of them, as it was a rare date sovereign from the Sydney mint. Worth a bit of a premium. It all worked out in my favor I suppose.

The thing is, if you have the market, the US bullion also has a premium when you sell, and it's recognizable.

The Iranian Pahlavi I bought for $5 under melt will never get a premium - at least in the USA. It's another world trade coin, very similar to the sovereign and identical in weight. I could almost guarantee that if I put it up for auction, it would get less than the sovereign.

You must also consider the collectible and numismatic value when talking coins.

 

1 oz. Libertads on eBay's daily deals today for $40 over spot. Great deal.

 

I mix up my purchases. Some I do online and some I do at my favorite LCS or dealers at coin shows. I don't have to worry about sales tax in my area so that is not an issue. The shops that I have issues with are the ones that have little to no customer service and overcharge. I had to do some digging to find a shop that gave me good service and had fair pricing. I.E. at the shop I go to, the guy is cool to begin with. He will spend a lot of time with you if you have questions and he is not pressuring a sale. His price for silver rounds is $.25 over what I can do online. His 90% is better than what I can do online. So I go to him for my 90% which is about once a month. I refer customers to him and he appreciates it. I want to have good relations so if I want to sell some bullion I am getting the best price. This kind of relationship rarely occurs at most brick and mortars.

 

too nice to melt

 

I'm thinking about a 1/4 ounce Gold Canadian Maple. How do I compare the premiums to just buying a one ounce Maple? I know it's probably rudimentary math but need some help figuring this stuff out quickly.

 

Usually if the price is quoted as $10 over spot for a 1/4 oz gold coin, you would take the premium and multiply by 4 to get $40 over spot per oz.
Some places will say it is $40 over spot per oz, which you would divide by 4 to get $10 over per coin.

Most places tend to quote the price as $x over spot per coin since it looks cheaper that way (even though it is not).

You should expect to pay a higher premium for a fractional than a full oz. Currently ebay seems to have 1/4 maples at $30-$40 over per coin = $120-$160 over per oz. To me, that is too much of a premium, especially when 1 oz maples go for $15-$35 over per oz. In my experience, a local coin store buys fractionals at only a small premium to full ounce coins. So if they pay spot for the 1 oz, they might give you +$10 for a 1/4 oz = $40 over spot per oz.

 

Thanks for the information. I busted out my calculator and figured out the math so I have a better grasp for fractional. In my opinion now the fractional is not worth it. I'll just go for the full ounce.

 

Bman, I know that every place is different, but in the BM shop I work at, we charge increasingly larger premiums as the piece gets smaller.

10% on a 1/10 oz, but only $65 on an ounce

I figure that more info is better, HTH