Frequently Asked Questions

The spot price is the current market price at which a precious metal can be bought or sold for immediate delivery. It is determined by global trading on commodities exchanges like the COMEX and fluctuates throughout the trading day based on supply and demand. When you buy physical metal from a dealer, you will pay the spot price plus a premium that covers the dealer's costs and profit margin.

A premium is the additional cost above the spot price that you pay when purchasing physical precious metals. Premiums cover the costs of minting, distribution, dealer overhead, and a small profit margin. Premiums vary by product type, with generic bars and rounds typically carrying lower premiums than government-minted coins. Buying in larger quantities often results in lower per-unit premiums.

Gold is generally considered the more stable store of value with lower volatility, making it popular for wealth preservation and hedging against economic uncertainty. Silver tends to be more volatile but has significant industrial demand, which can drive price appreciation during economic growth. Many experienced investors hold both metals in their portfolio, often at a ratio of 75-80% gold to 20-25% silver, to balance stability with growth potential.

A precious metals IRA is a self-directed Individual Retirement Account that allows you to hold physical gold, silver, platinum, or palladium as part of your retirement portfolio. The metals must meet IRS fineness requirements and be stored in an approved depository. You can fund a precious metals IRA through a rollover from an existing 401(k), traditional IRA, or other qualifying retirement account without incurring tax penalties.

The IRS requires that precious metals held in an IRA meet specific purity standards: gold must be 99.5% pure, silver must be 99.9% pure, and platinum and palladium must be 99.95% pure. Popular eligible products include American Gold Eagles, Canadian Gold Maples, American Silver Eagles, and approved gold and silver bars from COMEX-approved refineries. Collectible and numismatic coins generally do not qualify for IRA inclusion.

Professional coin grading involves submitting your coins to a third-party grading service like PCGS or NGC, where expert numismatists evaluate the coin's condition on the Sheldon scale from 1 to 70. The coin is then authenticated, assigned a grade, and sealed in a tamper-evident holder (known as a slab) with a unique certification number. Graded coins generally command higher prices than raw coins because buyers have confidence in the independently verified condition.

Coin grades use the Sheldon scale, which ranges from 1 (barely identifiable) to 70 (absolutely perfect). The prefix indicates the coin's category: MS stands for Mint State (uncirculated), PF for Proof, and SP for Specimen. An MS-70 coin is considered flawless with no marks or imperfections visible under 5x magnification, while an MS-69 may have one or two tiny contact marks. The difference of even one grade point can significantly impact a coin's value, especially for popular series.

Most reputable dealers fully insure all shipments until delivery is confirmed, typically through carriers like Lloyd's of London or specialized precious metals insurers. For IRA holdings, metals stored in approved depositories are covered by the facility's comprehensive vault insurance at full market value. If you store metals at home, you should add a rider to your homeowner's insurance policy, as standard policies often have low limits on precious metals coverage.

Look for dealers who are members of recognized industry organizations such as the American Numismatic Association (ANA), Professional Numismatists Guild (PNG), or the Industry Council for Tangible Assets (ICTA). Check their Better Business Bureau rating, read verified customer reviews, and confirm they have a physical business address and transparent pricing. Be wary of dealers who use high-pressure sales tactics or make unrealistic promises about investment returns.

The three main storage options are home storage in a quality safe, a bank safe deposit box, or a professional depository vault. Home storage gives you immediate access but carries theft risk and may not be covered by standard homeowner's insurance. Professional depositories like Delaware Depository or Brinks offer segregated, fully insured storage with regular audits, making them the preferred choice for large holdings and IRA-held metals.

You can sell your precious metals back to most online dealers through their buyback programs, which typically offer prices close to the current spot price minus a small spread. Many dealers will provide a locked-in price quote over the phone, after which you ship your metals to them via insured mail. For rare or numismatic coins, consider selling through auction houses or specialized rare coin dealers who can help you achieve the best market price.

In the United States, physical precious metals are classified as collectibles by the IRS and are subject to a maximum long-term capital gains tax rate of 28% for assets held longer than one year. Short-term gains on metals held less than one year are taxed as ordinary income. Dealers are required to report certain transactions on IRS Form 1099-B, and you should keep detailed records of your purchase prices to accurately calculate your cost basis when selling.