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Investors and collectors face a difficult choice: gold coins vs. bars.
Both are gold. Both are shiny. Both are beautiful. So what’s the difference?
In this guide, we will explore the similarities and differences between bars and coins. We will look at how they are valued, how to purchase them, and how to liquidate your bars and coins.
We hope to help you decide what’s best for your needs.
But let’s face it. It’s gold. There are no bad choices here.
Gold coins are government-minted currency. Typically at least 99.5% pure gold, they are dollar-denominated, spendable money—just like a penny, dime, or quarter.
There are different factors to consider when comparing gold coins vs. gold bars.
Investors and collectors buy gold coins for their gold content, scarcity, and collectibility. These characteristics make gold coins far more valuable than the amount stamped on the coin.
Gold coins can be a great foundation for your portfolio. Physical gold offers the following benefits:
Investors buy physical gold coins in two ways.
The Gold IRA is the method of choice for those with an existing individual retirement plan or an eligible 401(k). The all-encompassing precious metals IRA makes gold investing easy. You own eligible gold coins—stored, insured, and secured—within your IRA.
IRA-eligible gold coins must be:
Investors and collectors with cash opt for direct delivery of their gold coins. You choose what you want to own, remit payment, and the insured gold coins ship directly to your doorstep.
There are no eligibility limits with direct delivery. You may choose anything that is available and fits your budget.
Gold bars are refined gold—99.5% pure or better—shaped into a bar or block.
When choosing between a gold bar vs. coin, keep in mind that gold bars are not currency and do not originate from government mints.
Gold bars are considered bullion gold. Bullion derives its value strictly from the amount of gold in the bar. Scarcity and collectibility rarely factor into the value of a gold bar.
Gold bars are IRA-eligible if they:
Gold bars are also available via direct delivery. Choose the size of your bar and the manufacturer (if desired), and the bars ship to your door.
Whether you choose gold coins or bars, physical gold has proven to be a solid long-term investment.
But not all gold is created the same.
Let’s look at the factors differentiating a gold coin from a gold bar to determine which is right for you.
The production process for a gold coin is long, complicated, and expensive.
A government meticulously plans coin production before the minting process begins. It hires artists to create the images that will appear on the coins. It designs stamps and presses to transfer the images onto the coin. And humans oversee the process, operate the machinery, and administer quality control on the entire operation.
Bars are simple. Refiners clean raw gold, melt it, pour it into molds, and create a bar. They may stamp it with a company logo along with markings noting its weight and purity. That’s it. Gold bars are beautiful but not fancy or rare.
At current supply levels and in economic conditions, gold bars fetch $100-$200 over spot price per ounce. Prices depend on quantity and payment method.
One ounce brand name bars, with assay, cost between $2,069-$2,166.
Higher ounce bars price slightly below the one ounce multiple.
Coins are far more expensive to produce. Those expenses translate to the price, as coins typically cost more per ounce than bars.
At today’s spot price of $1,982 per ounce, one ounce American gold coins cost $2,129-$2,229 per ounce. Total ounce quantity and payment method affect the price.
In the long term, the value of the gold content in a 1-ounce bar is the same as the gold content of a 1-ounce coin. The coin’s value tends to exceed the bar’s because collectibility, scarcity, and recognizability factor into the equation.
We will touch on those aspects a little later.
Whether you buy bars and coins direct-delivery to your door, or you buy them in an IRA, gold must be safely stored.
The Gold IRA does the work for you. The IRS mandates that your IRA-eligible metals store in a neutral location that is guarded, insured and accounted for. Several depositories—vaults—have certification to hold you metals. The list of depositories includes:
Storing direct-delivery gold bars and coins is the responsibility of the investor.
Prepare before you receive your gold.
Gold coins arrive in tubes. Gold bars arrive wrapped.
Capped tubes line up neatly for easy storage. Bars stack, but the larger the bars, the more room they require. Make sure to add a protective layer between bars, to protect them from scratches and chips.
Have a safe large enough to hold your gold. Make sure it is heavy enough not to be carried easily, or bolted to the floor.
Talk to your insurance agent and insure your metals.
Accidents happen. Theft happens. Be prepared and protect your investment.
Gold coins are produced in finite amounts. Once they sell out, the laws of supply and demand come into play.
Collectors value scarcity and want something that others don’t have. They are willing to pay more in hopes of selling for a profit in the future. Investors welcome that sentiment and try to take advantage by buying low and selling high.
Purchase cost premiums rise if a coin has low supply and high demand. It is not uncommon for the most revered gold coins to fetch six and seven figures on the open market.
The most expensive coin in the world is an extremely rare, uncirculated, U.S.-minted 1933 Saint-Gauden coin—the same type of coin that lined the pockets of millions of Americans during that era.
That vaunted $20 gold piece sold at auction for nearly $20 million.
Gold bars are great for single-level investing. They offer the basic protections of gold but lack the appreciation potential of coins because they’re not as scarce or coveted by collectors.
You get more ounces of gold per dollar by buying bars. But a 1-ounce gold coin can be worth exponentially more than a simple 1-ounce gold bar.
Gold coins can be liquidated in almost any country.
Because they are minted by governments, gold coins are easily recognizable. They typically include built-in anti-counterfeiting features that a trained eye can identify.
You can usually liquidate gold coins on the spot, with no need for assaying (testing for authenticity). They tend to fetch a higher price per ounce than a gold bar.
Liquidating gold bars can be a little more tricky.
Bars have no unique markings that make them hard to counterfeit. Any dealer wants assurance that a bar isn’t gold on the outside and lead on the inside. Therefore, bars may require some degree of assaying before completing an exchange.
The assaying process has a cost that may affect the exchange rate for your bars.
Acquiring your gold coins and bars—within an IRA or via direct delivery—from a reputable dealer such as Advantage Gold can solve your liquidation problems.
Advantage Gold offers a two-way market for its clients. You can safely and discreetly buy your precious metals from us. When it’s time to sell, we will typically buy them back from you—no questions asked and at market price.
We know that investment goals change and sometimes life gets in the way.
Gold coins and bars are a great addition to any portfolio.
You don’t have to choose between a gold coin vs. bar to get the potential protection, appreciation, and peace of mind that gold affords. Both will serve you well.
Coins add additional layers for potential growth and are universally recognized.
Bars give you more ounces per dollar but lack collectibility, scarcity, and the safety of having been government-minted.
There are no bad choices here. Why not choose both?
Call us today at Advantage Gold, or click the link and we will contact you.
We will walk you through the simple application to transfer or roll over your current retirement plan into a precious metals IRA.
Our account executives will also present your options and direct-deliver your bars and coins to your doorstep.
We’ve been educating clients for almost a decade and will show you how easy it is to own gold.
We’re here, and we’re happy to help.
Please note that Advantage Gold and its representatives are not licensed or registered investment advisers, attorneys, CPA’s or other financial service professionals. We do not offer or render any legal, tax, accounting, investment advice or professional services. Additionally be aware that precious metals carry risk of loss and are not a suitable investment for everyone. Past performance is not necessarily indicative of future results and you should always consult your financial and tax professional and carefully evaluate all risks associated with the acquisition of precious metals before making the investment.
The statements made on this website are opinions of Advantage Gold LLC. Past performance is not necessarily indicative of future results. Precious metals, Gold American Eagles, Proof Gold American Eagles, certified gold coins, as well as gold and silver bars carry risk and investing in precious metals directly or through an IRA is not suitable for all investors. Precious metals and coins (i.e. Canadian Gold Maples, Canadian Silver Maples, American Gold Eagles, American Silver Eagles, Proof Gold American Eagles, Proof Silver American Eagles, Certified Gold American Eagles, Numismatic Gold Coins) may appreciate, depreciate, or stay the same depending on a variety of factors. Precious metals can and will fluctuate unexpectedly. Advantage Gold cannot guarantee, and makes no representation, that any metals purchased (i.e. .999 gold bars, .9999 silver bars, or any gold coins) will appreciate at all or appreciate sufficiently to produce a profit above and beyond the mark up/ commissions charged whether they are bought for direct delivery or inside of a precious metals IRA. The decision to purchase or sell precious metals with cash or inside of a Gold IRA or a Gold Backed IRA, and which precious metals to purchase or sell, are the customer’s decision alone, and purchases and sales should be made subject to the customer’s own research, prudence and judgment. By accessing any Advantage Gold content, you agree to be bound by the terms of service. Review the terms of service and privacy policy.
*Consult your tax Advisor.
