How does it feel when your friend tells you, “You know, I own some gold.” It puts him/her in a class of a few who own this precious commodity. So, if you also feel that this is the time to own gold, the next question might be, “How do I buy gold?” Keep reading to learn about the main things that you need to know and the best ways to buy gold in 2021.
Things You Need to Know when Buying Gold
When you start thinking of how to buy gold, it is important to understand a number of things, especially those that impact its price:
- The Current Gold Price
Before purchasing gold, whether as a bullion or instrument for investment, it is prudent to check the price on the market. The current price is also referred to live price. You can get this by checking the trading exchanges because this is where the gold prices are set. The live price is determined by the latest month’s price.
However, it is important to appreciate that not all sellers follow the price as given by the exchanges. This implies that if you are not careful, there is a risk of buying at a price that is way higher than market prices. Again, buying physical gold might cost you more because of the premiums involved in procuring, manufacturing, and selling the product.
- Purity Levels
Gold comes in varying levels of purity, and this can greatly impact the price. For example, the purest form of gold is 100% gold or 24K gold, which is very malleable and most expensive. This is why it is mainly used for ornamental purposes. The other forms of gold are 22k gold and 18k gold, which are 91.6% gold and 75% gold, respectively.
Furthermore, you need to understand and only go for gold that is certified. If the gold you are about to buy is not certified, the chances are it will be rejected on the market when you finally decide to sell.
Finally, you need to ensure that the seller provides you with a bill of purchase, which contains important details of the transaction. This makes it easy for you to seek redress in case of a problem and during resell.
How to Buy Gold
There are a number of ways that you can use to buy gold, and we are going to list the most common:
- Buy Gold Bullion Bars
When many people think of buying gold online, what runs through their minds are physical bullions that come in the form of bars, ingots, or coins. You can acquire these in different weights, few grams to 400 ounces. Note that legitimate gold must be clearly stamped with karat purity, manufacturer, and weight.
Most of the sellers, especially the ones who deal with bulk gold quantities, operate online and then send the bars to clients. However, it might be possible to buy smaller gold bars from jewelry, pawnshops, and numismatics downtown.
- Gold Coins
Today, several firms and countries, such as the US and Canada mint uncirculated coins. While they are technically legal tenders and can theoretically be used to pay for goods/ services, we do not use them because the face value would be far less than what they are actually worth. If you want to get minted coins, they come in varying weights, ranging from one-tenth of an ounce to cater to different investor’s purchasing abilities to larger 100- ounce bars. In most coins, the gold purity is 22-24 karats. This purity is guaranteed by the companies that mint them.
When purchasing gold jewelry, the price might differ from other forms, such as bullions and coins, because it is not just tied to the quantity of gold therein. In addition, it depends on the jewelry craftsmanship. For example, you might find the price of jewelry is very high, although the quantity of gold is just a small percentage of the entire weight. Simply put, you will be paying more for less gold.
If you are looking forward to buying gold, it is important to start by understanding it and then select the preferred option based on quality. Furthermore, you should only buy from trusted brands, such GoldAvenue. They also make the process easy, fast, and fun.