Investing in Physical Gold

There are various ways to invest in gold. The simplest is to just buy bullion outright. Let’s look at the options for investing in gold bullion.

Coins or Bars – Which Should You Buy?

Whether you’re looking to buy or sell gold bullion in Melbourne, there are two main forms: ingots (bars) or coins. Gold coins have an advantage over gold bars in that they allow for greater flexibility. It’s just easier to sell 20% of your gold if you have ten gold coins rather than an entire, single gold bar. What’s more, coins are easier to sell than big bars. However, if you’re looking to invest in a sizeable amount of the metal, bars might be the way to go for you.

Gold Coin Investment

There is a wide array of gold coins like the American Eagle and Chinese Panda. Obviously there are coins that are more expensive than others since they’re antiques or they’re rarer.

If you’re looking to simply track the gold price and concentrate on those that sell gold bullion in Melbourne at the cheapest premium, then ignore those numismatic (specialised, older) coins.

The most common gold coin on the planet is the South African Krugerr and which was first produced in 1967. Because of its availability and popularity, it usually trades at the cheapest premium. Other good options include the Britannia and the sovereign. These are officially UK tender so if you do sell them at a profit, you don’t need to worry about capital gains tax.

No matter how you buy your gold bullion, there is no VAT or stamp duty to pay.

How to Buy Gold

The main thing to consider is costs. Typically gold dealers make their money just like anyone else – selling for greater than market price. And buying for less, of course. The difference tends to range depending on the type and quantity of bullion you’re buying and who you buy it from. The current state of supply and demand is also a consideration.

Watch out for bad deals from gold vending machines. It seems that so called gold bars are popping up in shopping malls appealing to people who are eager to turn cash into gold quickly. But if you’re a serious investor, stay well away.

One of the cheapest places to buy gold coins is Hong Kong especially on Queen’s Road located at the Central District. UK investors, though, can buy from established European and British dealers who will deliver straight to your door. Do go with a well-known firm that is large and boasts a good track record.

As for when you want to sell gold bullion in Melbourne, beware. Without the right knowledge you could find yourself getting as much as 5% less than market price.

Storing the Gold

One of the greatest benefits of owning gold is that you have a complete financial breakdown and you have it at hand to sell. Gold is a great form of insurance so if you get to the point where all your other assets seem worthless, you can sell your gold.

The biggest problem with physically owning gold, though, is having to take care of it. You’re going to need to store it safely. A safe is the obvious option as is a safety deposit box at the bank. If you choose to keep your gold at home, make sure your home insurance covers it. Keep in mind that this could seriously bump up your premiums.

Buying Gold Online and Having it Stored

Another alternative if you want to buy gold bullion and have it safely stored for you is to buy online via a reputable gold website. Some sites offer the option of buying gold that is already held in vaults in Switzerland, New York and London. The site conducts daily audits of the stock and allows you to take physical delivery of your gold if you want to.