During tough economic periods and an unstable stock market, investors will often turn their attention to gold. Why? Because they see it as a “safe haven.” In 2020, there was a surge in interest in gold thanks to the COVID-19 crisis and the subsequent recession. This time of uncertainty had investors looking for a safe asset to put their money towards.
Gold has functioned as a symbol of wealth ever since the start of recorded history. Its beauty and scarcity led to it being sought after by many an ancient civilization as a manifestation of status and power. During the following millennia, the fascination with this precious metal has ceased to decline.
Nowadays, most monetary systems are not tied to a gold standard. While this particular system was abandoned decades ago, the precious metal is still seen as insurance against fiat currencies relying on nothing but faith to preserve their values. Gold maintains intrinsic value because, in contrast to currencies, there is a limited supply of it that is impossible to increase artificially.
The general appeal of gold makes it an attractive alternative for investors looking for diversification for their portfolio. There are plenty of ways one can buy gold, whether it be as an investment or simply for decoration. One of these methods includes the incorporation of the internet, which given how technologically advanced the current world is, sounds like a natural progression.
What to Expect When Buying Online
The rise of the Internet has made it easier for consumers to buy pretty much anything they can imagine. This, of course, includes precious metals. Contrary to how brick-and-mortar retail stores operate, online retailers typically do not have high overhead costs. Moreover, they do not have a limited number of customers able to reach them. Both advantages are what keep costs to a minimum.
When purchasing gold online, one should expect to pay only a couple of dollars over the spot for bars or rounds instead of the more than $5 over that physical retailers ask for. Online retailers can sometimes offer a broader range of higher quality products because they are not bound by the limitations of a physical location. Moreover, online dealers’ reactions to fluctuations in the metal price are not the same as that of store dealers. This, in turn, retains consistency in online costs.
There is one drawback to buying online investors must be aware of. Unlike buying from a store, investors cannot hold the product in their hands when buying online. Conventional brick-and-mortar stores that sell gold have the items on display and there is no shipping to wait for.
Online vs. Store
Purchasing gold online is on the same level of safety as buying from a physical retailer, if not surpassing it.
Whether an investor shows interest in buying gold bars or coins, it is possible to purchase gold online and be safe. It ultimately comes down to if the investor deals with a dependable gold company, such as International Precious Metals. IPM’s industry affiliations with the following organizations reflect the retailer’s commitment to fair and honest business practices that correlate with each’s standards:
- American Numismatic Association (ANA)
- Certified Acceptance Corporation (CAC)
- Numismatic Guaranty Corporation (NGC)
- Professional Coin Grading Service (PCGS)
- Industry Council on Tangible Assets (ICTA)
- The Better Business Bureau (BBB)
By purchasing from a physical retailer, investors can see each coin or bar, measure its weight and feel, and then take it home in no time. However, there is a notable disadvantage when buying from a store: taxation. Suppose that the shop taxes precious metals sales. If this is the case, then that tax is passed on to the consumer, and it will appear on the bill. With this particular situation, buying from an online retailer out of state is a comparatively better choice.
Important Factors to Remember
When purchasing gold online, there are several things one must remember:
- Know who your seller is. Authenticity is essential.
- Check the return policy. Always look for the website or seller’s return or buyback policy when buying gold online.
- Make sure you receive the bill. A bill helps in cases of return and exchange, as well as ensure that you are getting the promised purity and weight.
- Ensure that your package has been perfectly sealed. The packaging should be perfect and not show any signs of being tampered with or damaged.