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Where to start?


CatLady2017

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Posted

Hi everyone, 

I've been tracking gold prices for the last couple of months and nearly bought last time the value for an oz dropped under £950, but then decided I should wait until it dropped under £925 and that didn't happen.

Seeing as interest in banks is pretty much 0% and the political climate is far from ideal I started to think about buying some gold to be on the safe side. 

I know that if you sell gold coins they are exempt from capital gains tax which great, but I'm not sure if in the long run I will stay in the UK, so then I'm thinking do I buy non British coins or do I just buy bars?

Seeing as this isn't really something you can ask your friends without them knowing you're about to store gold at home, I thought I'd ask here.

Thanks for your help.

Posted

Hello and welcome to the forum

Well known bullion coins like Sovereigns or Kruggerands are recognized worldwide so I wouldn't imagine it would be a problem to sell at home or abroad 

I compiled a list recently of threads discussing "what to buy?" type topics, maybe you might find some intriguing/helpful and worth reading 

 

 

Help thread for members new to silver/gold stacking/collecting

The Money Printing Myth the Fed can't and don't money print - Deflation ahead, not inflation 

Posted

I have been stacking silver for a few years and as i have the all my 2017 bullion bought, i am planning to start stacking gold. I bought my first 1/10th oz last week  :wub:

I can not advise you what to buy, kman's above link will help you with that. Most bullion is worldwide as said above and i have never heard of someone having problems selling gold bullion anywhere in the world (nice problem to have).

But... as far as timing your buys goes, i would advise to place an order every 1-3 months which will help to even out the spot price you are paying. I place a big order every 6-10 weeks for silver based on how much overtime im doing at work and i have a good avg per oz. As we buy gold vat free, i plan to buy little and often. Picking up 1/10th,1/4 oz's and sovs and giving myself a nice avg while spot is low overall. I also found that trying to time the market to save a few quid stressed me and i over thought when to buy which took some of the buzz out of it. 

Stack on!!!

Welcome to the forum :) 

Make new friends but keep the old.

One is silver and the other gold

* * * * K   e   e   p       o   n       s   t   a   c   k   i   n   g  ....my friends****

Posted

CGT isn't something you need to worry about unless you are selling gold in bulk. I would just buy whichever coin/bar you fancy.

Gold bars have lower premiums due to them being more cost-effective to produce. However, they lack the detailed finish seen in coins. They also take up more storage space due to their physical dimensions. I don't have any statistics but I imagine gold bars are easier to counterfeit due to their lack of detail. Don't buy gold bars off eBay.

Gold coins have slightly higher premiums owing to them having more detailed designs and are smaller in dimensions. In general, the smaller the coin, the more it cost to produce the coin, which then translates to higher premium for the buyer.

Gold in general is a poor investment. It does not give you dividends unlike some stock that give you quarterly or yearly dividends. However, gold is less risky to hold on to in the long-term as it will always have value whereas stocks can go from 10 to 0 if the company fails. It is however a great way of storing vast amount of wealth in a small volume. Great for when you want to move asset. Other factors that you need to take into consideration when purchasing gold is where you intend to store them. Certain gold dealers offer to store your physical gold in their vault. Unless you have a lot of gold, don't use that option as your gold loses value due to you having to pay a monthly storage fee. I have never tried storing gold at the local bank but I am sure they will be able to accommodate you but first, ask how much it will cost. If you move a lot due to work/life commitments, then buy larger gold denominations, e.g. the 1 oz rather than fractional gold (1/2, 1/4, 1/10, 1/20 oz). This is purely for ease of moving them. It is easier to keep two 1 oz coins in your pocket than twenty 1/10 oz coins. If you intend to keep your gold at home (especially if it is rented accommodation), make sure they are stored in an easily accessible yet innocuous place.

The most commonly cited reason for why people invest in gold is to hedge against fiat currency (printable money). In my opinion, that is a failed logic. You will be waiting an entire lifetime before that happens, if it happens. There are a lot of very powerful institutions in the world that will prop up a failing major currency such that it is unlikely to fail. You see a lot of people on this forum that claim to "invest" in gold but they are the same people paying a huge premium to purchase coins with a pretty design (myself included). Remember, when you are selling gold to a dealer, the gold is only worth their weight in gold and not how pretty it looks. You can get a little bit more above spot price (daily average price) for proof (very shiny version) of gold coins when reselling but don't expect to get rich from it.

Don't be tempted to buy different coins. Have a plan and stick to it (takes immense will power!). If you are a true investor, buy the cheapest gold and not the one that looks pretty. It is long-term investment and you will be holding on to your physical gold for several years before turning a decent profit. Don't expect to turn a profit over months.

Avoid numismatic coins. These are coins with collector's value and are minted in limited quantity, which drives up its price. They look pretty but when it comes time to resell to dealers, you still only get offered its worth in weight and not design. I made this mistake by purchasing the Australian Lunar coins. If I could rewind time, I would stick to just one type of coin.

Personally, I have now stuck to investing in the gold Krugerrands. Having said that, I lack will power and bought a proof 1/4 oz gold some months ago! I also only buy pre-owned coins and never new coins because aside from looking shinier, they are of similar value in weight. The Krugerrands have an interesting history with it being the first gold bullion ever produced. It is a South African coin and has the lowest premium amongst all the bullion coins. They are also widely recognised so you do not have to worry about dealers not knowing what they are. Canadian Maple leaf has a huge premium owing to their in-built counterfeit-avoidance measure. They also scratch easily. This shouldn't matter if you are just investing and not collecting. A scratched gold bullion is worth as much as an untarnished bullion of the same weight. You also pay a high premium for American Gold Eagle/Buffalo if you are in the UK. British coins like the Britannia has a higher premium than Krugerrands. Sovereigns are a good alternative for investment. They are small denominations and more affordable. It is the difference between paying 1,000 GBP as opposed to 250 GBP. Chinese Pandas are not worth their premium in terms of investment. Austrian Philharmonics also have high premiums but they do look very nice!

Lastly, places to buy gold from: Atkinsons is the only online dealer I shop with. They do not charge for delivery and their stock have 3% premium over spot. Hatton Garden Metal (HGM) looks at first glance to be cheaper than its competitors due to its low 2% premium above spot. Do not be deceived. HGM charges you for delivery, which will result in it being more expensive than Atkinsons, unless you buy in bulk.

Posted
3 hours ago, sbxsat said:

Avoid numismatic coins. These are coins with collector's value and are minted in limited quantity, which drives up its price. They look pretty but when it comes time to resell to dealers, you still only get offered its worth in weight and not design. I made this mistake by purchasing the Australian Lunar coins. If I could rewind time, I would stick to just one type of coin.

I think what you're recommending to Cat is to avoid semi-numismatics or modern collectibles (you referenced the Perth Lunars)?  By definition, numismatics are actually the opposite.  These are coins that have an external value above and beyond the base value of the PM.  And if you've done your homework, made smart decisions and work with the right outlets, over time your investment will be worth far more than the metal content.  Think older Sovereigns, Pre-1933 American coinage (Morgans, Peace Dollars, for example), early-to-mid 19th century Francs, etc.  It does take more work though but I've found the brilliant minds that haunt this Forum to be invaluable when considering a numismatic purchase.

Posted

thank you everyone for your comments, the links to the other pages and your personal comments are really helpful. 

I'm buying for long term investment, I don't believe that banks provide us with enough certainty and they certainly don't give you any interest, but I like being able to have to gold with me and it being easy to move around. 

I have some ideas on how to keep the coins at home and am going to look into the krugerrands and I'm going to look at Atkinsons, I've currently been looking at BullionbyPost as they have free postage too, but I've never bought before so I appreciate other people's personal experiences.

Posted

Check out this site. I have used them a few times for silver. There 1/10th oz britannias and 1/2 sovs are at good prices. For anything bigger, use someone else. 

https://www.sarniasilver.com/

 

Make new friends but keep the old.

One is silver and the other gold

* * * * K   e   e   p       o   n       s   t   a   c   k   i   n   g  ....my friends****

Posted

Before you choose to "invest" in PMs make sure that you have a decent pension on the stove and that you are paying into it for later years and also to take advantage of the tax relief. Even for people not paying tax or perhaps not in work, you can make every year an instant £720 tax free gain by investing in a SIPP.
Pay £2,880 each year into your SIPP and get £720 added for FREE by the government, effectively making a gross investment of £3,600 which will grow tax free until retirement or until you are 50 and need to dip in. Making an instant 25% cash gain is definitely worth noting compared to the gains likely to be achieved in flipping 2.8 ounces of gold or 150-170 bullion silver coins.
Assuming you are concerned about capital gains, you only pay tax on gains above £11,300 in any given tax year.
Have a spouse then you can double this to £22,600.
Should you decide to sell some of your PM portfolio I guess you might consider this worthwhile when the potential profit is at least 15%.
That means you would have to sell about £75,000 of PMs before CGT even starts to kick in or £150,000 with a partner.

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