How to Buy Gold Bars

Buying gold bars can be a smart financial decision, as gold is considered a safe haven asset that tends to retain its value even during times of economic uncertainty. If you are considering purchasing gold bars as an investment, there are a few key factors to keep in mind.

Remember to do your research, purchase from reputable sources, consider storage and security, factor in additional costs, seek advice from financial professionals, and regularly monitor your investment. With careful planning and due diligence, investing in gold bars can be a valuable addition to your overall financial strategy.

Now let's find out how to buy gold bars.

250 gram gold bar. Source Valcambi.

Steps for How to Buy Gold Bars Today

Follow these steps to get started investing in gold bars.

1. Decide Where to Buy Gold

Before you buy your gold bars, make sure that you research which dealers specialize in selling gold bullion, and deal only with reputable dealers with lots of positive client comments. You may also want a dealer with a straightforward buyback policy and responsive support staff.

Make sure that any gold bars you purchase have a recognizable hallmark and the appropriate stamping. These features help ensure that you're buying an authentic gold bar. While some private mints also produce gold bars, many don't include a hallmark or other markings, so you can't be sure of the purity of such gold bars.

Remember these important factors when selecting a bullion dealer to buy gold bars.

• Reputation: A dealer's reputation with its clients can be inferred by social media comments and reviews left at sites like Trustpilot. You'll also want to check if the company has received awards or industry recognition for its services. Steer clear of dealers with numerous client complaints and companies that try to sell you overpriced gold products.
• Buyback Policy: Reputable dealers tend to have a buyback policy for their clients. This feature ensures you have a buyer for your bars if you decide to sell. Dealers with a buyback policy also typically give their clients a decent resale price.
• Delivery: For bulk gold purchases, bullion dealers that offer a flat delivery rate would likely be your cheapest option. Bullion dealers will typically not ship gold to you until all payments have cleared, so that would increase the amount of time for delivery.
• Customer Support: Bullion dealers generally have a toll-free telephone number and live chat option on their website. A good dealer will also have an order tracking and tracing service and will ship gold with proper insurance. Support can be extremely important in case an issue arises with your order.

2. Register With the Gold Retailer

Since most U.S. banks that sell gold will only deal in federally minted bullion coins, the best places to buy gold bars are typically local and online bullion dealers. Some of the best gold brokers are Advantage Gold, American Hartford Gold, Bullionz, JM Bullion and AMPEX. Scroll down to find a more expansive list. Other methods of acquiring gold bars include online eBay auctions and Gold-to-Go automatic teller machines (ATMs).

Such ATM gold vending machines can be found in cities like Dubai and Las Vegas, although make sure you know gold's prevailing market value since these machines often charge a substantial premium over the spot bullion price. 

3. Select the Gold Alloy Type

If you want to purchase gold bars, you will generally want to invest only in 99.9% pure gold bars rather than buying gold alloy bars where the gold is mixed with other metals. Once you've selected a reputable source for buying gold bars, you'll need to decide if you want a cast, minted or CombiBar.

While each type consists of investment-grade gold, they have different characteristics, advantages, and disadvantages:

Cast

Also referred to as poured and molded, these types of gold bars are cast into a special mold that assures the appropriate weight and size. This process dates back to the 4th century B.C. in China. Cast bars tend to have a more rugged appearance and are typically labeled with a simple engraving describing the details of the bar and its manufacturer. Due to the economic efficiency of this process, cast bars are generally the least expensive to invest in.

Minted

These are the type of bars you might find at Fort Knox. They have a slick, smooth and shiny appearance and are the most common gold bars. The nice finish on these bars makes them more expensive than traditional cast bars and often easier to sell because they tend to be popular. They also come securely packaged and may lose value if you open the package.

CombiBar

The CombiBar is the size of a credit card and weighs 50 grams. It is usually the most expensive bar type and has a purity of 99.9% gold. Each bar can be broken down into 1-gram pieces manually, which can be useful if you need to use your gold as currency.

4. Pay for Your Gold

Buying gold bars from a reputable online or local bullion dealer requires selecting the bars you wish to purchase by weight, quantity and price. After making your selection, you put the gold bars in your cart, select a payment method, enter your mailing address to receive the shipment, pay for the order online and check out.

Paying for your gold bars from an online bullion dealer typically involves payment via credit/debit card, bank wire, PayPal or eCheck. Some bullion dealers have recently begun accepting select cryptocurrencies for payment as well. Gold-to-Go ATMs accept cash and credit and debit cards. If you buy gold bars from eBay or other online auction sites, you would have to pay using a method acceptable to the seller.

5. Trade Your Gold

Although gold bars can be traded, buying gold bars as an investment generally makes more sense than considering them a tradable asset.

Even with a decent buyback policy from your bullion dealer, trading spot gold via an online forex broker would generally be far less cumbersome than trading physical gold. Buying and selling gold bars involves insured shipping, receiving and physically transporting these valuable items and could present a theft risk.

On the bright side, because of the high purity and standardized nature of gold bars, finding a buyer for your gold is generally not difficult. If you decide to sell your bars, make sure you ship them through an insured delivery service using its tracking/tracing capabilities.

Valcambi CombiBar with $100 bill behind. Source: YouTube

Importance of Gold Bar Size

         Gold bars of different denominations, hallmarks and stamps. Source: gold-bars-blog

While gold bullion coins generally come in troy ounce denominations, gold bars are typically weighed in grams and can be purchased in denominations of 1 gram to 1 kilogram, although you can also find 1 troy ounce size bars that weigh 31.1035 grams (slightly more than the avoirdupois ounce used for measuring food and liquids).

For larger gold purchases, the standard gold bar is known as the Good Delivery bar since it can be delivered into gold futures contracts and weighs 12.5 kilograms or 27.5 pounds.

Given the current gold price of $1,943 per troy ounce, the market value of a 50-gram gold bar would be approximately $3,129.78. Similarly, the gold content in a 1-gram bar would be worth around $62.60. Smaller denomination bars often carry a premium over the spot price.

If you plan on selling portions of your gold investment in the future, you might want to consider buying a 50- or 100-gram CombiBar since they can easily be broken up into 1-gram pieces by hand. A larger bar size would probably make more sense for long-term and bulk investments.

Gold Bar Authentication and Certification

Gold bars typically come with an assay card or certificate, while most coin purchases and other types of gold purchases come with a Certificate of Authenticity (CoA). Assays can be printed on a card or on a certificate and should contain all the pertinent information for the gold bar, such as authenticity, purity and weight.

Assays also include a seal and provide a serial number for the bar, which gives you further proof of its authenticity and integrity. The assay also generally provides a mark of the mint where the bar originated.

Compare Gold Brokers

Now that you know how to buy gold bars, you need to choose the best gold broker for you. Finding the right broker for your needs to make gold bar purchases does not have to be difficult. Check out our picks for the best brokers to buy gold bars through by reviewing this list. All these picks offer direct delivery and IRA purchases, so if you want the tax benefits of an IRA, any of these brokers would be a great choice. 

Is it Better to Buy Gold Bars or Coins?

If you plan on making a large gold investment, buying cast or mint gold bars would probably make more sense than buying coins. Coins were once easier to use as currency than bars, but the new CombiBar and the availability of small denomination bars means gold bars can be just as usable as gold coins.

Cast bars represent the cheapest option per gram for a gold bar and are often preferred by bulk gold collectors because they are the traditional gold bar. Minted bars cost extra, but some investors prefer their nicer finish, while the CombiBar's ability to be broken down into 1-gram pieces makes it the best choice for those who might want to use gold as a currency.

Hedging Against Inflation with Gold Investments

Investing in gold bars can help diversify your portfolio and safeguard against inflation. Make sure to buy from a trusted dealer and verify the bars' authenticity. Deciding between cast, minted, or CombiBars depends on your personal preference. Consider different payment options. Gold bars are typically a long-term investment, with smaller bars offering flexibility and larger bars being suited for bulk investments.

Frequently Asked Questions