What should my physical silver and gold consist of???
I've had a couple similar questions lately from readers about what their silver and gold savings should consist of. I spoke quite a bit about how much to own; depending on your purpose; but not so much on what type. So this won't be a long post, but for those interested in how much of different types, you might find it interesting.
Let me first recap HOW MUCH of each I feel the average person should have. Without getting back into the details of "Why", let me simply state, that for the average person, I would advise to have about 500 ounces of silver, and 5 ounces of gold. For those who have a higher net worth and/or standard of living, 1000 ounces of silver and 10 ounces of gold. Any place in between would be fine. All of this of course must be your decision. It must be based on WHY and WHAT you are storing silver and gold for. If you're a prepper and you believe in an Economic Armageddon, then you probably won't stop storing silver and gold. Even if you reach the 500-1000 ounce mark for silver and 5-10 ounce mark for gold. For the person wanting "Inflation Insurance", the 500-1000 / 5-10 ounce mark should get you through any economic hyper-inflationary scenario. For those saving in silver and gold to purchase items at a discount or to reduce debt, obviously you want to collect until your stock pile of silver and gold equals your debt (or the items you want to purchase). For the investor, treat it like any of your other investments and diversify according to the level of risk you're willing to take.
Remember; silver and gold ARE MONEY!!! They are the only true MONEY around today. Paper FIAT CURRENCY can and will lose value, and it can be taken away from you at a moment's notice by the big banks and the government. Not even the FDIC insurance is a safe bet. So remember, you're not really BUYING silver and gold. You're EXCHANGING one currency/money for another. FIAT (Paper Currency) with very little safe value, for PHYSICAL Silver/Gold that has VERY SAFE Value. Once you realize this, you'll see that you aren't SPENDING you're MONEY. It's STILL THERE!!! It's simply converted from paper to metal. Just like your home, once paid off, is storing equity (Money) in a different form also.
So, what kind of silver and gold should you own? Rather, what ratio? First rule!!! It MUST BE PHYSICAL SILVER/GOLD!!! I won't even entertain paper silver/gold. Not for this purpose. If you want paper silver/gold such as ETF's or mining stock, that's fine. Just DON'T CONSIDER it money or REAL silver/gold. Consider that an "Investment" with risks just like any other stock, bond, etc.
If I was going to have a ONE SIZE FIT'S ALL allocation, then of the 500 ounces of silver, this is what I recommend.
225 ounces of generic 1 ounce rounds: Least expensive premium over spot to purchase. Fairly easy to sell/trade back for "Fiat Currency" to supplement income or to purchase goods in a bartering environment.
125 ounces of COUNTRY MINTED 1 ounce pieces. Example: American Silver Eagle, Canadian Maple Leafs, Austrian Philharmonic, Australian 1 ounce dollars, Mexican Libertad, etc. These may cost a little more with premiums up front, and you won't gain this premium back if using these during an economic breakdown of fiat currency. The advantage however is, during the BEGINNING DAYS/MONTHS of economic breakdown of fiat currency, not everyone will be as knowledgeable of silver yet. 1 Ounce coins minted by governments, will be more trustworthy initially. In time, all silver and gold will be trusted. But in the beginning, the laymen won't have any idea what a silver round is. Actually, they won't even know the difference between a 1964 90% silver quarter and a modern 2015 POS (Piece of Shit) quarter. So it will help to have some of these round available initially.
100 ounces of Silver BARS: These will be in the 4, 8, and 10 ounce category. It's ok if they are the fancy 4 or 8 ounce round symbolic or the 10 ounce bars. These will be used to purchase or trade for large expense items. The individuals that you'd be selling or trading with at this level will know very well what thos 4, 8, or 10 ounce bars/rounds are. You won't be trading this to the normal person.
50 ounces 90% silver. This would be equal to about $70 FACE VALUE of U.S. pre-1965 dimes, quarters, halves, and dollars. This has the advantage of the COUNTRY MINTED silver; whereby people will recognize and trust it; but it's also the SMALLEST DENOMINATION available in silver. This will help you when wanting to buy or trade for something that is very small in value. Imagine trying to buy a small amount of food or similar that only costs a few dollars (Equivalence). Even at today's rate, it's difficult to GET CHANGE BACK if you gave an ounce of silver and what you're buying/trading for is only worth about 1/4th an ounce. 90% dimes and quarters will be a great thing to have. Don't get caught in the trap of trading/selling with the ignorant person who doesn't know about silver and a PRE-1965 silver coin.
Now, if you happen to feel you want to go towards the 1000 ounce mark because of your standard of living or your level of wealth, simply DOUBLE what I listed here.
As for gold, there's just no real break down. Rarely will you find NON-Country Minted Gold. You can, but you don't really save any money buying it. Example: Today, you can buy a 1 ounce American Gold Eagle, Gold Canadian Maple Leave, Gold Philharmonic, or Gold Krugerrand, in the $1200-$1250 price range. That's the same price as a 1 ounce bar Pamp, Buffalo, etc. So WHY even go there??? Unlike silver, where you're going to have HUNDREDS of OUNCES, gold simply isn't going to be like that. Stick with the BIG-4 Gold Coins. American Eagle, Canadian Maple Leaf, Austrian Philharmonic, and South African Krugerrand. If you are one of my Non-USA readers, and these 4 mints aren't that available to you, look for other Country Mints such as Australia or British. And remember..... NEVER BUY FRACTIONAL GOLD!!! Some will say you need to have smaller pieces of gold, because you can't make change for small items. "THAT'S WHAT YOUR SILVER IS FOR"!!! Your gold is to diversify and to provide for a very large item you are buying or trading for. It wouldn't be unrealistic to believe you could buy a home for 300 ounces of silver if you wanted to. At $500 an ounce, very realistic, that's about $150,000. At a realist ration of 30:1 silver to gold, that would be 10 ounces of Gold. If this type of purchase came up and you wanted it, you might not want to liquidate most/all of your silver, or all your gold. Maybe you trade 5 ounces of gold and 150 ounces of silver. Anyway, that's why you want the gold. But again, keep gold in 1 ounce coins and keep them in the MAJOR 4-6 Country Minted Coins.
Again, if you want to aim for the 1000 ounce mark, then double the numbers above. Or, to make it simpler, Go with 500 generic 1 ounce rounds. Half as much (250 ounces of Country Minted Silver like eagles, maple leafs, etc. 150 ounces in BARS. And 100 ounces of 90%. ($140 face value).
Just a little FYI: in case you didn't realize it.
500 troy ounces of silver is equal to a little OVER 34 POUNDS!!! 1000 troy ounces is around 70 pounds. That's a lot of silver to try and CARRY around with you if you must relocate. It's also a lot of silver to store and hide in your home. Not trying to scare you or make you think twice. Just want you to think about the WHY and WHAT you are buying this silver and gold for. In TODAY'S DOLLARS, that same 1000 ounces (70 POUNDS) of silver, is equal to about 14 OUNCES of Gold. That's LESS than 1 POUND. You could fit 14 American Gold Eagles in your pocket. Not saying you should have all gold. Silver is so greatly undervalues, and has the greatest potential to increase; plus the smaller value makes it easier to spend when needed. REMEMBER: It will be hard to MAKE CHANGE for a large piece of silver or gold. But if you know for a fact that you make need to LEAVE where you are living, you may want to consider either a different proportion of silver to gold to own. Or, if the plan is to move to a location that already has family living there, maybe you PRE-STORE some of your silver there now. (Make sure it's a family member you trust). Anyway; just something to keep in mind.
Take Care:
CYA: SE:
Let me first recap HOW MUCH of each I feel the average person should have. Without getting back into the details of "Why", let me simply state, that for the average person, I would advise to have about 500 ounces of silver, and 5 ounces of gold. For those who have a higher net worth and/or standard of living, 1000 ounces of silver and 10 ounces of gold. Any place in between would be fine. All of this of course must be your decision. It must be based on WHY and WHAT you are storing silver and gold for. If you're a prepper and you believe in an Economic Armageddon, then you probably won't stop storing silver and gold. Even if you reach the 500-1000 ounce mark for silver and 5-10 ounce mark for gold. For the person wanting "Inflation Insurance", the 500-1000 / 5-10 ounce mark should get you through any economic hyper-inflationary scenario. For those saving in silver and gold to purchase items at a discount or to reduce debt, obviously you want to collect until your stock pile of silver and gold equals your debt (or the items you want to purchase). For the investor, treat it like any of your other investments and diversify according to the level of risk you're willing to take.
Remember; silver and gold ARE MONEY!!! They are the only true MONEY around today. Paper FIAT CURRENCY can and will lose value, and it can be taken away from you at a moment's notice by the big banks and the government. Not even the FDIC insurance is a safe bet. So remember, you're not really BUYING silver and gold. You're EXCHANGING one currency/money for another. FIAT (Paper Currency) with very little safe value, for PHYSICAL Silver/Gold that has VERY SAFE Value. Once you realize this, you'll see that you aren't SPENDING you're MONEY. It's STILL THERE!!! It's simply converted from paper to metal. Just like your home, once paid off, is storing equity (Money) in a different form also.
So, what kind of silver and gold should you own? Rather, what ratio? First rule!!! It MUST BE PHYSICAL SILVER/GOLD!!! I won't even entertain paper silver/gold. Not for this purpose. If you want paper silver/gold such as ETF's or mining stock, that's fine. Just DON'T CONSIDER it money or REAL silver/gold. Consider that an "Investment" with risks just like any other stock, bond, etc.
If I was going to have a ONE SIZE FIT'S ALL allocation, then of the 500 ounces of silver, this is what I recommend.
225 ounces of generic 1 ounce rounds: Least expensive premium over spot to purchase. Fairly easy to sell/trade back for "Fiat Currency" to supplement income or to purchase goods in a bartering environment.
125 ounces of COUNTRY MINTED 1 ounce pieces. Example: American Silver Eagle, Canadian Maple Leafs, Austrian Philharmonic, Australian 1 ounce dollars, Mexican Libertad, etc. These may cost a little more with premiums up front, and you won't gain this premium back if using these during an economic breakdown of fiat currency. The advantage however is, during the BEGINNING DAYS/MONTHS of economic breakdown of fiat currency, not everyone will be as knowledgeable of silver yet. 1 Ounce coins minted by governments, will be more trustworthy initially. In time, all silver and gold will be trusted. But in the beginning, the laymen won't have any idea what a silver round is. Actually, they won't even know the difference between a 1964 90% silver quarter and a modern 2015 POS (Piece of Shit) quarter. So it will help to have some of these round available initially.
100 ounces of Silver BARS: These will be in the 4, 8, and 10 ounce category. It's ok if they are the fancy 4 or 8 ounce round symbolic or the 10 ounce bars. These will be used to purchase or trade for large expense items. The individuals that you'd be selling or trading with at this level will know very well what thos 4, 8, or 10 ounce bars/rounds are. You won't be trading this to the normal person.
50 ounces 90% silver. This would be equal to about $70 FACE VALUE of U.S. pre-1965 dimes, quarters, halves, and dollars. This has the advantage of the COUNTRY MINTED silver; whereby people will recognize and trust it; but it's also the SMALLEST DENOMINATION available in silver. This will help you when wanting to buy or trade for something that is very small in value. Imagine trying to buy a small amount of food or similar that only costs a few dollars (Equivalence). Even at today's rate, it's difficult to GET CHANGE BACK if you gave an ounce of silver and what you're buying/trading for is only worth about 1/4th an ounce. 90% dimes and quarters will be a great thing to have. Don't get caught in the trap of trading/selling with the ignorant person who doesn't know about silver and a PRE-1965 silver coin.
Now, if you happen to feel you want to go towards the 1000 ounce mark because of your standard of living or your level of wealth, simply DOUBLE what I listed here.
As for gold, there's just no real break down. Rarely will you find NON-Country Minted Gold. You can, but you don't really save any money buying it. Example: Today, you can buy a 1 ounce American Gold Eagle, Gold Canadian Maple Leave, Gold Philharmonic, or Gold Krugerrand, in the $1200-$1250 price range. That's the same price as a 1 ounce bar Pamp, Buffalo, etc. So WHY even go there??? Unlike silver, where you're going to have HUNDREDS of OUNCES, gold simply isn't going to be like that. Stick with the BIG-4 Gold Coins. American Eagle, Canadian Maple Leaf, Austrian Philharmonic, and South African Krugerrand. If you are one of my Non-USA readers, and these 4 mints aren't that available to you, look for other Country Mints such as Australia or British. And remember..... NEVER BUY FRACTIONAL GOLD!!! Some will say you need to have smaller pieces of gold, because you can't make change for small items. "THAT'S WHAT YOUR SILVER IS FOR"!!! Your gold is to diversify and to provide for a very large item you are buying or trading for. It wouldn't be unrealistic to believe you could buy a home for 300 ounces of silver if you wanted to. At $500 an ounce, very realistic, that's about $150,000. At a realist ration of 30:1 silver to gold, that would be 10 ounces of Gold. If this type of purchase came up and you wanted it, you might not want to liquidate most/all of your silver, or all your gold. Maybe you trade 5 ounces of gold and 150 ounces of silver. Anyway, that's why you want the gold. But again, keep gold in 1 ounce coins and keep them in the MAJOR 4-6 Country Minted Coins.
Again, if you want to aim for the 1000 ounce mark, then double the numbers above. Or, to make it simpler, Go with 500 generic 1 ounce rounds. Half as much (250 ounces of Country Minted Silver like eagles, maple leafs, etc. 150 ounces in BARS. And 100 ounces of 90%. ($140 face value).
Just a little FYI: in case you didn't realize it.
500 troy ounces of silver is equal to a little OVER 34 POUNDS!!! 1000 troy ounces is around 70 pounds. That's a lot of silver to try and CARRY around with you if you must relocate. It's also a lot of silver to store and hide in your home. Not trying to scare you or make you think twice. Just want you to think about the WHY and WHAT you are buying this silver and gold for. In TODAY'S DOLLARS, that same 1000 ounces (70 POUNDS) of silver, is equal to about 14 OUNCES of Gold. That's LESS than 1 POUND. You could fit 14 American Gold Eagles in your pocket. Not saying you should have all gold. Silver is so greatly undervalues, and has the greatest potential to increase; plus the smaller value makes it easier to spend when needed. REMEMBER: It will be hard to MAKE CHANGE for a large piece of silver or gold. But if you know for a fact that you make need to LEAVE where you are living, you may want to consider either a different proportion of silver to gold to own. Or, if the plan is to move to a location that already has family living there, maybe you PRE-STORE some of your silver there now. (Make sure it's a family member you trust). Anyway; just something to keep in mind.
Take Care:
CYA: SE:
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