Investments of all kinds are subject to drops and increases in value relative to other to other items of value, but so-called paper commodities can potentially be reduced to zero value while precious metals like silver will never lose their value because the value is intrinsic in the metal itself. Older U.S. coins contain up to 90 percent silver, and having been removed from circulation, these coins are now called "junk silver" coins. One needs simply to locate a reputable dealer and purchase whole or partial bags of these junk silver coins in order to preserve the value of the original investment.
Instructions
1. Locate a reputable dealer by asking friends and family for a good reference, by looking in the local yellow pages, and searching the Internet. When assessing the repute of any local dealer, contact the local chamber of commerce and Better Business Bureau (BBB) regarding that dealer to verify the good standing of the business. Online dealers can also be verified with the BBB website, and when considering the use of a buying or auction forum such as eBay.com one often may use that forum's reputation/feedback system to know about the character and history of a participating dealer.
2. Determine the current price of silver metal in terms of troy ounces. Precious metals are traded on markets daily, and therefore the current price always fluctuates, however this current price is readily available on the Internet and in many newspapers.
3. Determine the amount of silver contained in the bag intended for purchase. A "bag" of U.S. coins contains $1000 face value in coins, e.g. a bag of quarters contains $1000 / $0.25 = 4000 quarters. Junk silver coins can be purchased as coins that are either 40 percent silver, or most commonly 90 percent silver. Assuming that one invests in 90 percent junk silver coins, a bag will contain about 715 troy ounces of silver. A bag of 40 percent silver coins contains about 295 troy ounces of silver.
4. Calculate the current value of a full bag of junk silver coins. Multiply the current price of silver per ounce by the ounces of silver to be purchased. This is the current value, or spot price, of the silver contained in the bag.
5. Determine the premium to be paid. The difference between the spot price of the bag, and the sale price, is the called premium. Divide this premium amount by the spot price of the silver to convert the premium to a percentage. Lower premiums are obviously better for the purchaser, as the party receives more true value per dollar invested. Based on the premium to be paid one may determine the quality of the immediate investment.
6. Purchase silver from the dealer. Depending on the type of dealer, the process of purchasing will be different. All reputable dealers will provide a safe and fair way to complete the purchase and exchange of silver for cash.
Tags: silver coins, current price, junk silver coins, percent silver, price silver