Investing in silver has always been a valuable way to help lower the risk(s) associated with your investments. Some of these risks include fighting inflation, uncorrelated or opposite correlation of risk associated with equities, or emotional stability in times of turmoil. This is all wonderful but getting your hands on quality silver for a decent or fair price can pose its own problems.
The absolute cheapest way to buy silver as an investment is 0.999% Silver bars. With an average premium of 19.61% above the spot price, buying silver bars will provide you with the best dollar-to-weight value available in comparison to coins and “junk Silver.”
Very often people consider the cheapest way to buy silver is old currency minted between, 1878 to 1964. Often referred to as Junk Silver, these coins are valued based on the percentage of silver they contain which can vary from 35% to 92.5%. Junk silver can also be sold by “face value” in many bulk situations.
While these coins are referred to as junk Silver, it is only because they are considered “no numismatic” which means they have no value other than the silver they contain. (discontinued currency) Because they aren’t pure silver, a lot of people believe they have or should have lower premiums on the sale price. This isn’t always the case.
So we set out to find the cheapest Silver for you and it wasn’t the typical “Junk Silver”, even in bulk amounts!
Knowing that a lot of people have an appreciation for coins versus just bulk material or bars of silver, the average sample Premium on purchasing “Junk Silver” is almost double the premium on generic (or close to) silver bars.
But after finding several reputable, trustworthy sites to buy precious metals, we found some interesting results of price for the three silver assets we examined: “Junk Silver”, Silver Coins, and Silver Bars.
Silver coins have many allures such as a wide array of designs and mints. You can buy silver coins as a birthday present for someone who just had a baby, or as a staple for your own investments.
Finding The Best Price Of Silver
From an investment standpoint, you want to be getting the BEST dollar value per ounce that you can. To get a good price on silver we will base your purchase price on the spot value.
The spot price of silver is the current sale price if you were to buy or sell “on the spot” in the open market. For this sample of price comparisons (March 10, 2022) the silver spot price used at the time was $26.21. After doing a comparison of a few reputable businesses that you can buy silver from, it’s clear that bulk silver bars are going to provide you with the lowest premium above the spot price.
Of course, this is just a sample of potential websites available. Either way, the lowest premiums were found with SDbullion.com which includes only a 13.5% premium for Silver bars!
For the data collected other than bulk bars which are more based on weight, rather than style or prestige we tried our best to find the cheapest or most relevant silver to compare.
(All prices and premiums are subject to change based on individual business actions and commodity price)
|Website||American Eagle Coin (1oz)||Premium Above Spot Per Ounce ($26.21)||1oz Silver bar||Premium Above Spot Per Ounce ($26.21)|
|Kitco.com||$39.92||52.31%||$314.70 (10 oz bar) $31.47oz||20%|
** SilverTowne Buffalo Bar
Silver Bars VS Silver Coins
As you can see from some of the numbers each site has a different premium above the spot price. This isn’t uncommon in any industry but something to note is the average premium between coins vs bars. The average premium for the American Eagle coin was, 49.294% while a Silver bar was only 19.61%
The cost difference can partially be contributed to the extra cost of designing and minting an aesthetically pleasing coin versus a bulk bar of silver. But wanting to make money from the commodity price is based on weight, not beauty.
Junk Silver Price
So, how did multiple different bulk transactions of “junk silver” fair in comparison? Junk Silver was slightly better than coins, but no match for bulk silver bars.
Even when buying thousands of dollars worth of silver junk coins the spot premium was significantly higher than that of silver bars.
Let’s go over two other points to consider when you are looking for cheap silver because price alone isn’t the only factor.
|Website||Type Of Silver||Troy Ounce(s)||Total Cost (US)||Cost Per Ounce ($26.21)||Premium Above Spot Per Ounce|
|Bgasc.com||$10 Face Bag (90%) junk silver||7.15||$283.50||$39.65||$13.44 (51.28%)|
|SDbullion.com||$10 Face Bag (90%) junk silver||7.15||$233.75||$32.69||$6.48 (24.73%)|
|JMBullion.com||$10 Face Bag (90%) junk silver||7.15||$269.06||$37.63||$11.42 (43.57%)|
|Bgasc.com||$100 Face Bag (90%) junk silver||71.5||$2,810.00||$39.30||$13.09 (49.95%)|
|Kitco.com||$100 Face Bag (90%) junk silver||71.5||$2,299.00||$32.15||$5.94 (22.68%)|
|JMBullion.com||$100 Face Bag (90%) junk silver||71.5||$3,152.44||$44.09||$17.88 (68.22%)|
|SDbullion.com||$100 Face Bag (90%) junk silver||71.5||$2,330.94||$32.6||$6.39 (24.38%)|
|SDbullion.com||$1000 Face Bag (90%) junk silver||715||$23,288.27||$32.57||$6.36 (24.18%)|
|Average costs||$36.335||$10.13 (38.6%)|
While having an investment like silver can help you in many ways, it can only do that if you can sell it. You can’t just walk into a bank and expect them to buy it from you. Banks reserve the right to decline the transaction without giving you an explanation.
You can go to pawn shops and maybe get a good price, or many businesses buy silver online. You just send them the silver, they verify it and pay you. Not a bad deal but it can be cumbersome.
After outlining 3 potential silver investments: bars, coins, and junk silver, the most liquid tends to be
coins. Coins have more appeal to a wider range of coin collectors as well as investors in precious metals.
Bars of Silver like coins are reliant on how many ounces of silver they contain but don’t have as much collector appeal as coins and liquidity can be slightly affected by that.
Junk coins on the other hand are impure silver but hold more of a collector value because they are part of history. Selling junk silver coins can be a lot easier at pawn shops or in bulk situations.
Owning some silver won’t usually pose a problem for storage. Find a safe place in your home or a safety deposit box if you need to but that costs money and if you are using the silver as an investment it can end up hurting any potential returns you may receive in the future.
This becomes amplified and more important when you have large quantities of silver or buy big bulk shipments. You will be PAYING money rather than receiving money just to store your investment.
The Cheapest Way To Buy Silver
As you can see there is a great deal of variance between sites as well as premiums. Take the time to look at what and where you buy your silver. Make sure it is a reputable and cost-friendly business like SDbullion.com. You will save money and have better investment returns!
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