When you hear “gold bars,” visions of underground bank vaults sealed tight and stacked high with glimmering gold bricks may come to mind. While vaults like this do exist, gold bars are much more accessible than the everyday gold owner may imagine. Gold bars are portable, private and liquid, and in some ways, more straightforward to buy than gold coins. Find out how to go about understanding gold bars and selecting the bar that's best for your precious metals portfolio with these five steps.
Step 1: Choose the Size and Type of Gold Bar
Gold bars are produced in various sizes and are available at many price points. Choose from bars ranging from 1 ounce to 1 kilo, depending on your budget, personal preferences, storage capabilities, and holding strategy.
Size and price
The market value of a gold bar is almost entirely based on its weight in gold. A bar's price closely follows the spot price of gold, i.e. the price at which you could buy one ounce of gold right now (“on-the-spot”) as opposed to some date in the future.
In general, the larger the bar is, the greater the price. What amount of your wealth would you like to safeguard with gold? With this number in mind, you can narrow your options down to only bars that fall into your price range. Note that a bar’s final purchase price will vary slightly from the spot price of gold depending on the current market supply and demand, as well as local, national, and global economic conditions.
Minted vs. cast
Apart from the bar’s size, you also have different types of bars to choose from, typically minted and cast. Minted gold bars are hand cut or punched from a large flat piece of gold and are often produced with glossy finishes and artistic designs (though the design typically has little effect on the bar's market value). Minted bars, depending on their size and refiner, can be packaged in sealed assay cards (left) that provide details about the bar's authenticity and protect its condition.
Cast bars are made by pouring molten gold into a mold, a production method that dates back thousands of years. These bars tend to lack the illustrious shine of minted bars and vary in appearance based on how the gold is poured and cooled. Some gold owners prefer cast bars for this very reason, as the bars appear more “natural” and are fantastic visual reminders of gold's long-standing history.
Step 2: Understand How to “Read” a Gold Bar
Unlike some gold coins, gold bars are typically not produced with special designs that majorly impact the bar's market value. They are, however, produced with identifying marks that provide information about the bar's producer, weight and gold purity, and sometimes a serial number.
The bar's producer
Buying a gold bar with a well-known hallmark can be beneficial in terms of liquidity. A hallmark is a stamp that is unique to the bar's producer. It functions similarly to an item’s brand. The more well-known and respected a brand is, the easier it can be to sell or trade the brand’s products in the future. A respected hallmark can bolster a bar's liquidity. The Perth Mint’s hallmark is pictured on the right.
Gold bars are available from trusted government and private minting institutions alike, including from the Perth Mint in Australia, Johnson Matthew, Asahi, and the Royal Canadian Mint.
The bar's weight and purity
How a bar's weight and purity are marked will depend on the bar's producer. Some mark these details in large numbers and letters separately from the hallmark, like the Perth Mint does in the example on the right. Other refiners, like Johnson Matthew, incorporate the bar's weight and purity within their hallmark.
The bar's assay card
A bar's assay card is more than protective or cosmetic (though it does make storage easy). It is official documentation of a bar's weight and purity, and includes a serial number specific to the producer. While this card can help further assure a bar’s authenticity, not all bars are packaged in assay cards. They may be too large or come with another means of authentication, like a separate assay certificate.
Step 3: Plan to Protect Your Gold Bars
Consider how and where you will store and protect your gold. Gold bars require less space than coins to store the same number of ounces, which can make them easy to keep at home. You could also store your bars in a bank safe deposit box or at a facility that specializes in gold storage and protection.
How and where you store your gold bars will partly depend on your financial goals. Do you plan on holding them as a means of protecting your savings until your children are grown, or as a means of emergency financial assistance? If it's the latter, you may want to consider storing your gold close to home, as a bank or storage facility may have limited hours of operation or be located far away. In an emergency, your gold could be inaccessible. Mitigate risk by making accommodations for storing and protecting your gold bars before taking possession of them.
Step 4: Choose a Gold Company
One of the smartest ways to ensure you're getting the best gold bar at the best price is to buy from a reputable gold company that puts your needs first. How do know if you're dealing with a reputable company? Look for…
- Third party ratings and a long history of client reviews. As the Federal Trade Commission advises, “Check out the seller by entering the company's name in a search engine online. Read about other people's experiences with the company.” Reputable, established gold companies can show that they have a long history of great service. Many also have the highest ratings from consumer advocate groups like the Better Business Bureau and the Business Consumer Alliance.
- A focus on education. A company that prides itself on client education won't rush you into making a purchase that's not right for you. “We specialize in educating customers not only on the gold industry, but the type of portfolios they can use to protect their [assets],” said U.S. Money Reserve's CEO Angela Koch in an interview on Enterprise Radio.
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Step 5: Buy Your First Gold Bar!
The advantages of buying gold bars are numerous. When you’re ready, browse gold bars online and call 1-844-307-1589 to receive a free one-on-one consultation regarding your overall financial goals. Experienced Account Executives are standing by to answer your questions and help you choose the right gold bars and coins for your portfolio!