Need Your Help; Newbie/Noob Here Wants to Start Stacking Silver

[giantsforever1]

Hi, I'm new to this forum and stacking. I'd like to use silver as an inflation hedge primarily and, secondarily as currency in an economic collapse.

What suggestions do you have for the forms of physical silver to hold at home?

I'm especially concerned about getting too large a bar size that would either reduce its liquidity or give me a lower redemption price per ounce.

I have storage space at home, but would like to make my physical silver as compact as possible. Would you recommend 1 kg and/or 10 oz silver?

I read that the 1 oz are the most commonly sold/traded. Would you give me guidance on the proportions of 1 oz and 10 oz or 1 kg to hold?

Thanks!

[Robda1986]

Buying larger bars generally works out cheaper per oz but it depends on your budget kilos regularly change hands what you will find is people generally won't go for single 1oz's unless it's special as the cost of postage dents their average price per oz and 10's are in the middle 

[giantsforever1]

Thanks.

About the 1 oz, I meant that I was thinking about having some 1 oz for barter and to slowly exit or redeem if/when silvers prices start to become a bubble and/or I need cash in hand.

[Robda1986]

Keep track of what your buying and how much your paying avoid German or nickel silver as its not actually silver, keep half an eye on spot price and don't over reach your self last thing you want to do is have to sell before your ready to 

[giantsforever1]

Thank you

[Fadeingstar]

It used to be the case that there was a lower premium on larger bars such at 10oz or 1kg etc. Although in the current market that doesn't always seem to be the case in recent days and weeks, I have seen generic 1oz bullion coins selling for a comparable price per oz to 1kg bars. There are always the items that attract a premium such an Engelhard and Geiger if you are stacking for pure weight then you might want to stay away from high premium items.

Personally, I am keen to be able to quickly liquidate my holdings which is why I have gone for a lot of 1 oz coins as they are both collectable and if that fails, they are still silver. My reasoning being that it will be easier to sell a few oz's to a lot of people than waiting for 1 person to buy a large format bar. I am more of a collector though and not a “stacker” This is just my thinking and I know others will disagree.

Also, if things did go pear shaped, I think having 1oz coins might be easier to trade/barter with others for goods. So, you are not trying to slice or break bits off a large bar. Another consideration could be to look at some gold as it stands the moment 80oz of silver is roughly comparable to 1 oz of gold. In such a situation it can be much easier to transport a couple of 1oz or fractional gold coins as apposed 80 oz of silver.

When it comes to proportions that really is a question of personal preference and how much you have available to outlay in 1 go and as 1kg bar will be close to $875 at the current spot price that is without premium.  It can be more affordable to maybe buy 10oz of bullion a month whether that is a 10oz bar or 10 1 oz coins/rounds. Before you know it, you will have a kg in silver just sitting there.

Space wise 1kg bars will be the most compact form factor for your bullion as 1 kg of coins will take up more room than a solid 1kg bar especially if you are keeping your coins in capsules. Some places such as APMEX and the Scottsdale mint make bars that are designed to be stacked on top of each other so some 10oz bars won’t be far behind.

One thing make note of is to buy from reputable dealers and online sellers. EBAY is a cesspool full of fake goods and “german” silver which is an alloy of worthless metals. Watch out for plated things as well.

Keeping track of what you have, and the price is paid is essential a basic spreadsheet will do doesn’t have to be anything fancy or flash. Just the price you bought it for and how much you have of an item. Once you start it is very easy to want to buy everything and get a load of silver and stack it all nice and neatly. I would say it is important to resist that urge and not overextend yourself. Life is full of surprises and you want to make sure you have some money in the bank in case you have an unexpected expense such as car repairs etc. You don’t want to have to sell some of your newly acquired silver in a rush and not get for it what you would like.

These are just my thoughts and I am sure other will agree or disagree.

 

 

[Stacker2020]

The best advice I can give you if you haven't started stacking yet is to go out and research selling your silver. 

I would stack what I can sell readily. What is in highest demand can change from country to country, city to city and dealer to dealer. Go checkout your local coin shops, bullion dealers, pawn shops, antique shops etc. and see what they offer for silver.

Stack based on your findings. 

[giantsforever1]

Thank you, Fadeingstar and Stacker2020.

I'm in California, so I have to spend at least $1,500 to avoid sales tax (8.5%).

The nearest precious metals dealer in my area recommends 10 oz silver bars and, for gold, American Gold Eagles (not an upsell; I asked about gold).  I am familiar with this shop since the early 2000s, their being in the same building I used to work at. He also said he will use his X-ray machine to show me that the silver (and gold) are real. However, you have to pay in full to order the Gold Eagles due to none in stock; is that something others are seeing. If I do order and pay in full, and the gold coin doesn't get there soon, how long should I wait until I request a return?

Also, are there any negotiating strategies I can use to get better prices?

 

[Fadeingstar]

If you are spending $1500 a time, then you should be able to pick up a fair whack of silver for your money.

I think it would be best to get confirmation in writing as to the lead times you don’t want to order your items and then be waiting 2 months to get your hands on them. With no real action you can take against the dealer. That way you are covered against someone dragging their feet with it all. Another option would be to look at someone like APMEX they have a whole host of precious metals and I think they have a quick turnaround time.

Haggling is an interesting concept if you are going to be giving a dealer regular business then after you have made a couple of purchases then you might be able to try for a discount. You might not be able to do this with large online dealers but in person in the shop you might have a chance.

[giantsforever1]

Thank you.

Do you have any tips for in-person negotiating after making a coupld purchases with the same dealer, eg showing APMEX's on-line price as a comparable?

[RacerCool]

On 20/10/2020 at 09:21, giantsforever1 said:

Hi, I'm new to this forum and stacking. I'd like to use silver as an inflation hedge primarily and, secondarily as currency in an economic collapse.

Welcome to the forum. 

I'll mention that the very first things that need to be dealt, if possible future crises are your concern, is making sure you have a good supply of food and water, and medications and other things (batteries, water purification, etc, etc) before you start putting cash toward stacking silver or other precious metals. Think those things through a lot, not just as an after-thought. You can't eat, drink, and live on silver and gold and you can't count on people being willing to trade theirs for silver coins. Remember the crazy TP hoarding earlier this year? Yeah make sure you have those basics first.

You might also consider adding gold to your stack, too. It's much smaller than silver for the value it carries.

Also, if you want to use PMs for barter at some point then you should consider fractional sized amounts of precious metals.

I also live in the US and so my focus has mostly been on rolls of silver dimes, quarters, and half dollars, not so much on American Eagles and other 1 ounce coins. These are smaller amounts of silver than the larger 1 ouncers which is why they're called fractionals.

The same goes for gold. You can buy for example a 5 peso Mexican gold coin today for about $250 and it contains approximately 1/8 ounce of gold. Then you have a smaller fraction of gold and not a large 1 ounce chunk.

Just some things to seriously consider since I don't know what your thought process has been up to this point.

[giantsforever1]

7 hours ago, RacerCool said:

Thank you.

A few months back, I found some prepper videos, so I followed their advice about having food, water, meds, and other necessities.

You wrote: "I also live in the US and so my focus has mostly been on rolls of silver dimes, quarters, and half dollars, not so much on American Eagles and other 1 ounce coins. These are smaller amounts of silver than the larger 1 ouncers which is why they're called fractionals."

Do you mean 90% silver, as in pre-1965 US coins?

You also wrote: "The same goes for gold. You can buy for example a 5 peso Mexican gold coin today for about $250 and it contains approximately 1/8 ounce of gold. Then you have a smaller fraction of gold and not a large 1 ounce chunk."

Last night, I read David Morgan's "Get the Skinny on Silver Investing." He believes that fractional gold would be worth too much for everyday purchases in a SHTF scenario and to use junk silver instead. Also, I talked to a couple coin dealers, who said that I should only buy 1 oz sovereign coins, especially the American Gold Eagle, because fractionals have much higher premiums. What do you think about these two ideas?

 

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[RacerCool]

On 23/10/2020 at 09:39, giantsforever1 said:

A few months back, I found some prepper videos, so I followed their advice about having food, water, meds, and other necessities.

Do you mean 90% silver, as in pre-1965 US coins?

Last night, I read David Morgan's "Get the Skinny on Silver Investing." He believes that fractional gold would be worth too much for everyday purchases in a SHTF scenario and to use junk silver instead. Also, I talked to a couple coin dealers, who said that I should only buy 1 oz sovereign coins, especially the American Gold Eagle, because fractionals have much higher premiums. What do you think about these two ideas?

Good, having your necessities is super important.

My basic thinking is that all preparation is an educated guess.  We can't prepare for all possibilities, only the ones we think will reasonably happen.  And we might not even make the best choices today in preparation for tomorrow, but all you can do is try, which is much better than doing nothing.  So prepare as you see fit given your personal factors and your own budget.

Yep, pre-1965 silver coins are the way to prepare, in my estimation.  Until recently it wasn't too difficult to find rolls of uncirculated coins for not too large of a premium.  But these days almost all silver has high premiums, so the way I see it you're either going to buy silver or you're not.  * shrugs * If your primary concern is preparation for a radical change in the economy and you think you'll use silver and gold as money, then fractionalizing is the only way to go.  Pre-1965 silver should be the bulk of your stack if you live in the US. But of course you should add 1 oz coins if that's an interest you have.  Make it fun as well as practical, but again if using this as money is your primary concern then keep that as your primary focus when buying silver.  You probably won't be spending silver in 1 ounce quantities, for the most part.

The same thinking applies to gold.  And let's not confuse investing for a return in paper money with stacking for possible future use as real world spending money.  That's what you're doing with your silver so keep that thinking with your gold.  Buying 1 oz gold coins is useful only if you're purely wanting to turn paper into gold and store it.  But then what will your future use be with 1 oz gold coins?  It'll only be good for very large purchases, and breaking the 1 oz coin into smaller, more useful coins could be an issue. Think of how you use cash today.  Unless your name is Cosmo Kramer and you live across the hall from Jerry Seinfeld, then you don't carry rolls of 100 dollar bills as your day to day spending cash.  You carry 1s, 5s, 10s, and maybe a 20 here or there.  That same thinking should apply here.  A 1/10 oz or 1/8 or even 1/4 oz gold coin is much more practical than a 1 oz coin.  As far as premiums go you usually can't avoid them.  So just buy as your budget allows.  

But in my experience the best bang for your buck is in Mexican gold pesos, not in US gold.  For example, right now at my local coin shop I can buy eight 5 peso coins, each approximately 1/8 oz of gold, for a $15 premium on each coin.  For eight 1/8 oz coins that's a total of $120 premium.  At the same coin shop a 1 oz gold American Eagle will cost me a $120 premium.  So in this case you're getting approximately the same amount of gold for the same price, but now you've fractionalized it into eight coins instead of one.  As with silver, modern US Mint bullion gold simply carries too high of a premium if you're stacking for weight.  So I avoid it. 

The exception are the modern US $5 gold coins, which are commemorative-only issues of the old $5 half eagle circulated coins.  These are approximately 1/4 oz of gold, and can often be found with a similarly small premium as the Mexican 5 peso gold coins.