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Thursday, August 06, 2009

Tips on Buying Gold

Here are some tips on buying gold that can help you get the best gold for your money.

1. Find out which is the best gold for you to buy. Usually it is gold bullion bars, or gold coins or can even be GoldMoney (more on that later). This can depend on how much money you have to allocate to buying gold and why you are buying gold. If you have sufficient funds then gold bullion bars would be the way to go. These can be as small as one or half ounce bars or as large as one kilo bars or even the 400 ounce bars although buying those sized gold bullion bars would be very rare.

2. Searching around for the best price is important as the prices can vary. The smaller amount of gold you buy, for example, means the higher cost per ounce or gram. Due to fabrication costs and other factors, a one or half ounce bar (or biscuit as it is known) can cost twice as much as the value of the gold. Yet a larger bar will have a more acceptable cost attached to the value of the gold. The price you see in the news is not the actual price of gold. It is the price of gold futures . To see the actual price of gold you have to look at what dealers are charging. You can also get a very good idea from auction sites such as eBay which will show the current value people are placing on gold. Here you would not look at what people are asking but what people are paying.

3. When you have determined what gold you want to buy then the next question is where to buy it. Dealers tend to be the most expensive. You can get some good deals on eBay but that usually involves a lot of time and effort. Plus you have to verify the seller is selling the genuine article and not some fake of course. Practicing due diligence is very important when buying gold bullion online.

4. An alternative is to buy gold from GoldMoney. Here you can simply open an account rather as you would open a bank account. Deposit funds to GoldMoney who will then assign you gold at the prevailing price to your account. Your gold physically sits in a bank vault either in London or Zurich and you can add to it, cash it or a portion in and even, under certain circumstances redeem the gold in the form of one kilo gold bullion bars. The gold held in the vaults is regularly audited and is fully insured against the usual, theft destruction and so forth.

You can also transfer any quantity of gold to another GoldMoney account and, by the same token, have it transferred from another account to yours. You have to show proof if identity in order to open an account but once that is done you are free to accumulate gold without the issues of transport, insurance and storage as this is all taken care of. There is a small storage fee and some transfer fees but the cost of those is far below buying gold, having it shipped, stored and insured by dealer or mint. There is no minimum, you can buy a gram or an ounce at the same rate as a kilo or more as there are no fabrication and other costs to worry about. You can open an account at GoldMoney and quickly start to accumulate gold.

5. The best way to save gold is to accumulate some at regular intervals. This is regardless of the gold price. Each month or each regular period just buy some gold. The price may be up one month or down the next. It does not matter. It is the consistency that counts. The value of your gold will even out and tend to rise in the long term as the value of gold goes up against the value of currency.

So there you are, a few tips on buying gold that may help you to save and and increase your gold holding.