Gold Bars: Discover the Benefits of a Precious Metal IRA
Reid Sletten- Gold bars are an alternative to buying gold coins.
- Gold bars are .9999 fine gold, making them less susceptible to wear than gold coins, which might have .9999 gold.
- However, gold bars don't carry any face value, unlike gold coins.
Gold bars come in different sizes, weights, and shapes. The bars can be as small as one-quarter of an ounce or as large as 400 ounces. While gold bullion bars come in a variety of styles, the most popular are 1-ounce bars, 100-ounce bars, and kilo bars.
The benefits of gold bullion over gold bars include lower premiums, more liquidity, and greater flexibility.
Options for Gold Purchases
While it's common for people to invest in gold bars, gold bullion coins, and gold coins, you'll also want to consider the unique benefits of investing in gold bars. These can include:
Leverage with a smaller purchase: If you buy gold coins or bars, you'll likely find that they are priced by the ounce, which means that you'll need to make a larger investment in order to buy the same amount of gold.
More affordable: Gold bars are priced by weight, not by the ounce, which means that you can often buy more gold for a lower price per ounce.
Stored securely: Gold bars can be stored in a bank's safe deposit box or a vault, which makes them easier to secure.
Easier to transport: Gold bars are measured in grams and kilograms, which makes them easier to weigh and handle.
Easy to sell: Because gold bars are bought and sold by weight, you won't have to worry about fluctuating prices.
The Benefits of Gold Bars
Gold bars have a number of advantages over coins. Unlike coins, gold bars can be bought and sold only on the COMEX and on the LBMA. They are ingots, and come in different sizes and weights. You can store them at home or in a bank.
Gold bars have the advantage of being fungible. That is, a gold bar is exactly the same gold as any other gold bar. This makes it easy to sell, and the price doesn't vary with changing demand.
Gold bars are usually sold by the ounce, so you can have the exact quantity you want, and the price doesn't change with changing demand.
With gold coins, you don't get 100% pure gold, and the price varies by demand. Some people prefer gold bars for this reason.
Gold bars are easier to sell.
The liquidity of gold bars is much greater than that of gold coins.
Gold bars are easy to store, and they don't take up much space.
Gold bars are easier to move and store.
A gold bar may be worth more per ounce than a similar weight in gold coins.
Gold bars have the advantage of being fungible.
You can store gold bars in a bank vault.
Gold bars can be resold, which makes it easier to find buyers.
Gold bars are easy to melt down, if necessary.
Gold Bar Storage
Gold bars, or gold bullion, are the most efficient form of gold you can buy. The bullion is valued based on the total weight of the bar, not the size of the bar. Additionally, gold bullion is the purest form of gold you can buy, often pure 99.9% or 99.99%.
Gold coins, on the other hand, are valued based on their face value. While gold bullion bars can be stored in an IRA, gold coins cannot.
Gold Bar Prices
The price of gold bars is determined based on the price of gold itself. The price of a 1-ounce gold bar fluctuates based on the spot price of gold. The current spot price for 1-ounce gold bars as of Sept. 9, 2020, is $1,419.
Gold Bars Coin Variations
Gold bars come in several variations including:
Gold bullion bars: Plain gold bullion bars are valued based on their amount of pure gold. Gold bullion bars are typically .995 fine, meaning the gold content is 99.5%.
Gold coin bars: Gold coin bars contain one troy ounce of gold. These bars come in many different varieties, and the gold content in the coin bars can vary.
Gold coin bars: Gold coin bars contain one troy ounce of gold and come in many different varieties, and the gold content in the coin bars can vary.
Gold Bar Risks
Gold bars may be the least liquid form of gold ownership. If you choose to buy gold bars, you may incur significant storage fees.
The bars themselves, called gold bullion, are often quite large, so they will take up a lot of space in your safe. If you choose to store your gold in a safety deposit box, you will pay high insurance premiums.
They are easily damaged, so you must take precautions to keep your gold bars safe.
Gold IRA: Should You Open One To Save For Retirement?
The Bottom Line
Gold's appeal is universal. Although the yellow metal has been out of favor for some time, we believe this will change soon. Investors in all asset classes, not just precious metals, are scrambling for hard assets as the current geopolitical environment continues to present potential pitfalls.
