Should I Buy Silver Bars?
Precious metals like silver have long been considered a source of wealth throughout recorded history—from the earliest civilizations to modern times. In this article, we will take a close look at reasons for buying silver bullion, the best silver bars to buy, and the best way to buy silver bars. We’ll also take a look at why it’s better to buy silver bars rather than silver bullion coins.
7 Reasons to Buy Silver
- The value of silver is up right now
- Silver is a physical asset
- Silver is outperforming gold in bull markets
- Silver is considered “real money”
- It’s the perfect time to buy silver
- Silver’s industrial use is growing
- The demand for silver jewelry is increasing
Let’s take a closer look at these 7 reasons:
1. Silver is Valuable and Affordable
Unlike gold, silver is affordable right now. Currently, silver is about 1/70th the cost of gold and it will protect you with its high value in the event of a financial crisis. It’s affordable for anyone seeking to invest in a precious metal.
2. Silver is a Physical Asset
Although wealth is often measured by numbers in a computer or by paper notes, both these forms of wealth are subject to fluctuations in inflation rates and changes in exchange rates. Silver, by comparison, is a tangible, physical asset whose value is recognized in all countries. It’s small enough to put in your pocket and it’s a confidential and private means of exchange. A physical asset like silver is a hedge against cyber criminals hacking your financial assets recorded on a computer ledger and a hedge against the rising cost of living.
3. Silver Outperforms Gold in Bull Markets
When it comes to the gold and silver ratio, silver has outperformed gold from 1970 to 1980 and from 2008 to 2011. From 1970 to 1980, the value of gold gained 2,328%, but silver gained 3,105%. Then from 2008 to 2011, gold gained 166%, but silver gained 448%. To calculate the gold-silver ratio simply divide the price of gold with the price of silver at a particular time. This dramatic price range occurs because silver is a tiny market compared to gold–so any movement in the silver market has a greater impact on the price compared to gold. In bear markets, gold does better, but in bull markets, silver soars. Currently, silver is hitting another 10-year high.
4. Silver is Considered “Real Money”
Although we don’t think of silver as currency, it is considered money. Precious metals are often referred to as “real money” because they are not printed out in a mint nor stored as digital currency on a computer server. The worth of money in circulation only has value because it is fiat money; that is, money the government has declared legal tender based on the supply-demand ratio of currency. Silver, by comparison, is real money because its value is based on the value of a physical asset.
Silver is considered real money for two reasons: First, it doesn’t need another party to declare its value. Cash, stocks, and bonds all need the endorsement of another part to make the contract valid. When you own a silver bar or a few silver coins, you own real money. Second, it’s impossible to default on silver. It’s inconceivable to declare physical silver a default risk–which is not something you can say about any other type of investment.
5. It’s the Perfect Time to Buy Silver
The only countries that continue to warehouse silver are the United States, Mexico, and India. Other governments don’t have silver inventories. Silver is in limited supply.
What’s more, according to a World Silver Survey 2017 report, the production of silver across the globe fell by 0.6 percent in 2016, which is the lowest volume for silver mining since 1996.
Another interesting fact emerging from this report is that the US government’s silver inventories are down by as much as 73%. One chief reason for this decline is that the silver market price fell in 2011. Consequently, over the next few years, miners scrambled to cut costs so that mines could still turn a profit.
Today, the demand for silver is higher than ever before because silver plays an important role in industrial applications and silver jewelry plays a significant cultural role in countries with rising populations.
6. Silver’s Industrial Use is Growing
Silver is much more widely used than you might imagine. Silver is used in smartphones, and the sales of smartphones are on a continuous rise. Silver is used photovoltaic cells, which are used in solar panels. And silver is being used in Volkswagen’s self-heating windshields because these ultra-thin silver wires provide the best heat conduction. At the present time, the global industrial sector is consuming more than half of the silver available.
7. The Demand for Silver Jewelry is Increasing
In certain countries, the high demand for silver jewelry is based on cultural traditions. China and India, who happen to be the fastest growing populations in the world, have a strong cultural affinity for silver jewelry and require a constant supply of gold silver alloys, fine silver, and sterling silver.
A Quick Guide on How to Buy Silver
Frequently Asked Questions
Should I buy silver bars or coins?
If you are interested in silver bullion purely as an investor, then the question of whether to buy silver coins or bars is easily resolved. Silver bars make it easy to buy a large amount of silver in a convenient form. Silver bars are easy to store: for instance, a 100-oz silver bar is .999 fine, so you can store a vast amount of value in a compact size.
Meanwhile, silver coins make excellent collectibles. Silver American Eagles, Silver Canadian Maple Leafs, Morgan Silver Dollars, Austrian Silver Philharmonics, and Mexican Silver Libertads are sought by numismatics for their aesthetic craftsmanship. Occasionally, too, as you strive to build your collection of bullion coins you may stumble upon silver coin prices below the proper cost for silver. You might even find rare coins of considerable value selling at well below their market value. Silver coins are also easy to use for barter if there is a financial crisis.
Silver bars are better for investors than silver coins for a few main reasons:
- Silver bars have lower premiums. Although not as beautiful as coins, the purity of silver is high, and you are not paying for beautiful works of art. For instance, you would pay half or a third less for a high-value silver bar over a Silver American Eagle.
- Silver bars are much easier to store than coins. This may not be important when you first start, but as you begin to accumulate silver bullion, building up the number of troy ounces, a safe storage space becomes increasingly relevant.
- Silver bars will not tarnish if you store them correctly, and they are also easy to liquidate, easy to store in a private collection, and easy to transport.
Buy silver coins if you’re interested in collectibles and silver bars if you’re interested in investments. When it comes to comes to whether you should buy silver bars or coins, buying silver bars could be a key to investment success. For one thing, bars will add considerable value to your IRA or your investment portfolio; for another, the premiums are far lower than coins.
Should I buy silver rounds or bars?
New investors mistakenly believe that rounds have the same value as silver coins. Rounds are privately printed medallions whose value is based entirely on how much silver they contain. As an investor, it’s better to get silver bars. Keep in mind that bars are easy to store. For instance, although a 10 troy ounce of a poured silver bar is .999 pure, it is rather small, only three inches in length and one-and-a-half inches in width.
What size of bars should I buy?
As a buyer, avoid buying a 1,000-ounce bar. While these work well for banks, ETFs, and exchanges, and other financial institutions, they are not practical for private ownership. They can’t be divided up and if you want to sell your silver, it can be difficult to find buyers for the whole bar. It’s more practical, in terms of safety, storage, and sales to buy 10-ounce, 50-ounce, and even 100-ounce silver bars.
What is the price of silver?
When you are buying silver, you can find the spot price of silver by a simple Google search. At the time of this writing, the silver price is $14.64 per ounce.
What are the best silver bars to buy for investment?
As an investor, it’s probably not a good idea to simply buy 1 oz silver bars. It’s fine if you’re simply researching how to buy silver bars at spot price or where to buy gold and silver bars, but once you get serious, buy 10 oz bars or buy 100 oz silver bars.
Where to buy silver bars
Where do you buy silver bars? If you’re wondering, “where can I buy silver bars?” the good news is that you can buy silver bars online, including auction sites like eBay. Here at Treasury Vault, we also sell silver fractionals.
If you don’t want the convenience of buying online from reputable sources, then you can buy silver bars from bullion shops in your city.
Naturally, you need to do your due diligence when it comes to researching the best place to buy silver bars. When it comes to the best place to buy silver bars, it’s better to focus on the dealer’s reputation rather than simply on bars for sale.
How to buy silver bars
Ultimately, of course, it’s not enough to ask where can you buy silver bars, you also need to know how to buy silver bars. Buying silver bullion products (bullion bars or bullion coins) should not be done casually, like buying black desert silver or fine silver. Go through a comprehensive checklist. With that in mind, here are the important items you should have on your checklist before buying bars of silver:
- Weight — The weight is measured in troy ounces. What is a troy ounce? While an ounce is 28.35 grams, a troy ounce is a little heavier, 31.1 grams. When you look at a bar for sale, evaluate its ounce of silver by troy ounces.
- Purity — Consider the purity of the bars you’re interested in buying. A bar of .9999 is about as good as it gets.
- Refinery: Third, consider where it was refined. The name of the manufacturer should be stamped on it.
- Serial number — Verify that every silver bar is printed with a unique number.
- Verify IRA eligibility — Even a high-quality bar may not be permitted by your IRA. Your IRA may have certain stipulations on the type of silver bar they consider eligible.
The supply of silver will continue to dwindle in the future due to insufficient silver mining while the demand for silver for industrial purposes and jewelry will go up. Now is the best time to buy silver bullion bars because silver prices are bound to go up. Contact Treasury Vault today to learn more.