How to keep your gold and silver bullion investments safe and secure
One important factor to consider when investing in physical gold, silver, platinum, or palladium bullion is storage.
“I’ve bought these awesome coins and bars, but now I need to make sure they’re safe and secure. What do I do?”
We hear this concern on a regular basis.
The storage dilemma is one of the most common arguments critics of precious metals investing use to dissuade people from buying gold and silver bullion. With a share of stock, or some other financial instrument, you don’t have to worry about storing it, they say.
We’re here to tell you that figuring out where to safely store your bullion shouldn’t discourage you from investing. However, it is important to understand the different storage options available to you, as well as the pros and cons of each.
There’s no perfect solution, but as the financial meltdown of 2008 and similar crashes have shown, there’s really no perfect investment either. Ultimately, you must evaluate your personal circumstances to determine which storage option is best for you.
Continue reading to learn three of the most popular and common options for storing your gold bullion, silver coins, and other valuable investments.
If you’re looking for information on how to safely handle and care for your coins, check out our related article on 6 Rules for Properly Handling Your Precious Metal Coins
Storing precious metals at home gives you the best level of control and accessibility to your assets. You have the ability to purchase coin capsules, tubes, and albums to maintain the luster of those brilliant coins for years to come. If you have a larger amount of metals that require secure storage, you can consider buying a private home safe.
When storing your metals at home, you must consider the possibility of theft and natural disaster risks. If you don’t have a fire-proof safe, for example, you may want to consider adding that to your list of criteria. Fire and water proofing your secure storage are both good ideas. It’s possible to purchase insurance against these kinds of losses, but it can be expensive and difficult to obtain.
Aside from home safes, another option is to bury your precious metals somewhere on your property or hide them in a secret spot in your house. While these are certainly the cheapest ways to store gold or silver, it’s not necessarily the safest. This method also limits accessibility of your assets somewhat. Additionally, there’s always the risk that you might forget where you put your precious metals.
The main downside of storing your precious metals at home is the safety risk to you and your family due to theft, robbery, or burglary. You certainly don’t want to advertise that you have such valuables in your home. Nevertheless, some people feel uncomfortable storing high-value precious metals in their house due to security.
Lastly, liquidity is a negative factor to consider when storing gold and silver bullion at home. If you decide to sell your investment in the future, you will need to return your coins and bars to a certified dealer to sell them, which is a hassle. You may even have to get your precious metal assets analyzed for authenticity before the dealer will accept them, which costs money and takes time.
2. Bank Vault or Safety Deposit Box
A second option for storing your metals is a safety deposit box at your local bank, or in a private bank vault. Safety-deposit boxes come in a wide range of sizes and are relatively inexpensive (typically anywhere from $50 to $200 per year depending on the size). Bank vaults are also secure—theft at a safety deposit box is extremely rare. Storing in a bank vault, if available, is even more secure.
Of course, storing your metals in a bank vault or safety deposit box has its disadvantages, too. The main con is access. Bank hours are limited, so if the bank is closed (for holidays or after hours) then you won’t be able to get to your metals until the bank re-opens.
The risk of confiscation is another disadvantage of bank storage that some precious metal dealers try to push. However, this is a myth. In fact, it is no more likely that your gold or silver assets will be confiscated by the government than your house or the contents of your bank account. That’s because the U.S. dollar is no longer backed by gold.
Continue reading: The Myth of Gold Confiscation
3. Third-Party Storage Firm or Depository
A third option for storing your metals is in a depository or third-party storage firm. Companies like Brinks, Delaware Depository, or IDS of Delaware will store your bullion in a secure facility for a nominal fee. This is by far the most secure storage method, especially if your holdings are significant. Another advantage is the opportunity to store your gold and silver in a foreign country, which can provide certain tax benefits.
Most precious metals depositories offer two types of storage: segregated and allocated. With segregated storage, customers can store their precious metals in a private storage compartment, separated from the metals of other customers. Allocated storage, in contrast, let’s customers store their metals in a shared storage area along with other people’s valuables.
Continue reading: Segregated vs. Allocation Storage
One disadvantage of depositories is that, like bank vaults, you don’t have as immediate access to your metals as when they’re stored at home. On the flipside, third-party depositories generally have more availability than banks.
In addition, depositories are sometimes located far from your home. So while you can retrieve your metals any time you like, you may have to wait a few days before receiving them. You may incur additional secure shipping and processing costs if you decide to take physical possession of your gold and silver bullion.
As you can see, there are a few options for safely storing your precious metals. The most important thing to keep in mind is that they should be stored in a cool, dry place. Excessive moisture and heat can significantly devalue your investments in some cases.
Again, the option you choose depends on a variety of factors, including your reasons for investing in precious metals in the first place. Some people prefer the easy access of at-home storage, while others prefer the safety and security of a depository or bank vault.
Which option you choose isn’t nearly as important as your decision to invest in gold, silver, platinum, and/or palladium in the first place. Preserving the value of your wealth should be your primary concern. How you will safely and securely store these investments should be your next thought.