How and Where to Buy Silver Coins (2017 Buyers Guide)

Jeff Clark, Senior Precious Metals Analyst

Looking to buy silver coins? You’ve come to the right place!

This handy guide outlines everything you need to know, including the advantages of owning silver coins, the different coins available, the best coins to buy for investment, and where to buy them. We also include our “Investor’s Edge” with each section…


Advantages of Silver Coins

Many investors don’t realize that silver coins offer benefits far beyond price appreciation.

Consider the advantages you gain by buying silver coins. Similar to gold, silver is…

• A tangible asset. You can hold silver coins in your hand. They’re not a paper product that can be created out of thin air (and thus depreciated) like paper or digital forms. How many investments do you own that are in physical form?

• A store of value. Silver is money, just like gold. In fact, silver has been currency throughout history more often than gold. Silver’s price fluctuates, but due to its monetary value it has never gone to zero in thousands of years.

• Free of counterparty risk. If you hold physical silver, you don’t need another party to make good on a contract or promise. You have no default risk. This is not the case with stocks or bonds or virtually any other investment.

• Highly liquid. Silver coins can be sold virtually anywhere in the world. There are bullion dealers in just about every major city on the planet. And in a crisis, silver coins will be in high demand. Other collectibles, like artwork, take longer to sell, have a smaller customer base, and will likely entail a big commission.

• Private and confidential. How many assets can you say that about in today’s world? You must pay taxes on any gain, of course, but if you want a little anonymity, just buy some silver coins!

• Can’t be hacked or erased. It’s probably not a good idea to keep all your wealth in digital form today. That’s easy to do if you own some silver coins.

Buying silver coins will give you advantages you simply can’t get with almost any other investment.

•  Investor’s Edge: Owning some silver coins provides you with a real asset that has served as money for literally thousands of years.


Types of Silver Coins

There are a lot of silver coins on the market, but they all fall into 5 basic categories.

#1: Bullion coins simply refer to silver coins that are made almost exclusively from precious metal, in this case silver. They consist of highly refined metal and are considered investment-grade silver.

The most popular form of bullion coins are those that are made by a government mint. They are generally referred to as “sovereign” coins, meaning they are both manufactured and guaranteed by that government. They also come with a face value; these face values are mostly symbolic at this point, since the silver content makes them worth a lot more than the figure printed on the coin. But each government does guarantee they will always be worth the amount stated.

Silver bullion coins have only two layers of cost: the precious silver metal content and the dealer premium. This makes them very transparent since the price is largely based on the “spot price” of silver spot.

#2: Rounds refer to silver coins that are produced by a private mint. While usually of good quality and with lower premiums than sovereign coins, they don’t come with a face value or the same government backing.

There are many silver rounds produced around the world. Most private mints manufacture their own coins, and many organizations will have a round made. For example, GoldSilver is not a mint, but we have our own line of silver rounds, the Pegasus being the most popular and one we’ve made since 2013.

If you buy silver rounds, be sure the purity is at least 0.999%, and that the coin isn’t so obscure that few would buy it.

#3: Numismatic coins refers to rare coins, ones that are bought and sold by collectors. Unlike bullion coins, their value is only partially based on the silver content. Most of the value is based on their rarity, condition, and demand. Their premiums are usually much higher than bullion coins, and can stretch into the thousands of dollars (and in some cases, millions!).

Much like fine art, true numismatists (collector coin experts) are generally lifetime coin collector enthusiasts who have acquired years of specialized knowledge.

Proof coins are another form of collector coins. A proof coin is one that is made with high relief effects, which can be very eye-appealing. However, they come with higher mark-ups and are thus geared for collectors.

#4: Semi-Numismatic Coins refers to silver coins that are made to be collector coins but don’t yet have the historical significance of a true numismatic. They may or may not be worth more someday, but frequently can be bought near bullion prices. Those coins that will be more valuable someday will likely be those that have a limited mintage, like the one-ounce Canadian Lynx silver coin.

Be aware that these are still part of the collector’s world, so the higher the price you pay over spot, the more risk you assume.

#5: Junksilver refers to old quarters, dimes, Morgan dollars, and Franklin half dollars that are dated 1964 or earlier. These coins were made of 90% silver.

Today, US coins are made of base metals, like copper, nickel, and zinc, so some investors like to buy these old coins that were made of the precious metal. Since they’ve previously circulated through the economy, they do not come new.

The advantage of junk silver is that it could be used in barter situations. The disadvantage is that you will be paid less for these coins than sovereign ones, since they’re only 90% silver and have previously circulated.

Why did the US government stop making our coinage from real silver? In the early 1960’s, the silver supply for the nation’s coinage was dwindling rapidly. As Congress and the administration debated over silver’s future role in coinage, the silver price jumped 10% immediately—and then spiked another 30% by 1962. This set the stage for the complete elimination of silver from our coinage by the end of 1964. It just became too expensive.


• Investor’s Edge: Knowing the 5 types of silver coins will help you identify exactly what you’re buying, and what you can expect as an investor.


The Best Silver Coins to Buy

There are 3 basic criteria to look for when buying silver coins.

#1: Low Premium over Silver Spot Price

It’s pretty straightforward: the more you pay upfront, the higher the silver price has to climb for you to recoup your investment and make a profit. I’m very bullish on silver, but buying silver coins at 15% over spot is much less risky than those priced at 50% over spot.

The lowest premium coins will generally be sovereign bullion coins. Some silver rounds can be cheaper, but again, watch for odd mintages that may be hard to resell. The highest premium will be on rare coins. The best advice here is that you become educated before dabbling in the numismatic market. This includes proofs. Semi-numismatics may be attractive if they’re priced near bullion levels and are relatively well-known mintages. A good example is the silver Pegasus, a stunning coin that’s priced close to spot.

Will I recoup the extra premium I pay? Like any asset, market conditions can affect bid prices. In a bull market, buyback premiums tend to be higher than during bear markets. In 2011, at the height of the last precious metals bull market, I once sold a tube of silver coins to a dealer in Vancouver, Canada above the spot price!

In most market conditions, higher priced coins will generally fetch a greater premium upon resale than a lower-priced coin. So, for example, a silver proof coin will likely sell at a higher premium than a standard bullion coin. But it’s all relative; since you paid more upfront for the proof coin, your total return will likely be similar.

The ideal time to sell will be near the peak of a bull market—not only will the silver price be higher, but you’ll fetch the greatest premium, too.


#2 No Speculation

If you buy a rare coin, you are basically speculating on the future value of a particular coin. If you buy standard silver bullion coins, your investment is tied directly to the price of silver.

Because coin collecting is a different animal, there are many coin dealers that don’t sell numismatic coins at all (including GoldSilver.com). They don’t offer collector coins because, well, they’re not collectors, and also because they aren’t comfortable selling specialty products when most investors just need bullion.

#3 Easy Resale

As an investor, you want to buy something that won’t just rise in value, but that will also be easy to sell. You want to avoid a product that could take a long time to sell, or fetch a lower price than you expected, or doesn’t have many potential buyers.

Rare coins sometimes run into these difficulties… a buyer may want to first confirm the value or authenticity of a coin… or they may offer you less premium than you paid… or they may not want to buy it at all. On top of this, you have a much smaller pool of interested customers, as many investors are not coin collectors. These issues hold true with proof coins, too.

Sovereign coins, on the other hand, are easily recognizable literally the world over, can always be sold at or near the price of silver, and have a large customer base.

Junk silver will fetch a discount to the spot price, since these coins are not pure silver. As stated above, the value of junk silver is in a barter situation. If you end up not having to barter, your return will be lower than what pure silver coins fetch.

Add it all up and…

• Investor’s Edge: The best silver coins to buy are common silver bullion (sovereign) coins. They are pure silver and the most popular, which means you’ll have high liquidity when the time comes to sell.

Government (sovereign) coins are the most widely known around the world, have among the lowest premiums, come with a guarantee and a face value, and entail no speculation (other than the silver price). Even if you don’t sell them but pass them on to your heirs, they will need something that’s easy to sell.

Now that we know we should buy sovereign bullion coins, what exactly do we start with?


The Most Popular Silver Coins

The most popular sovereign silver coins in the world are the following six. They all contain one ounce of silver, and you’ll see the content and purity stated on the coin. All are guaranteed by a government and considered legal tender in the country of issue. Last, all of these coins are eligible to put in your IRA…


American Silver Eagle - Side by Side View

1 oz American Silver Eagle
Purity: .999
Face value: $1
Backed by: United States government
Ships in multiples of: 20 coins per tube (but can be purchased individually)
Distinction: Most popular silver coin in the world.



Canadian Silver Maple Leaf - Side by Side View

1 oz Canadian Silver Maple Leaf
Purity: .9999
Face value: $5 Canadian
Backed by: Commonwealth of Canada
Ships in multiples of: 25 coins per tube (but can be purchased individually)
Distinction: The Royal Canadian Mint’s advanced security measures make this one of the most secure silver coins in the world.




Silver Philharmonic Coin - Side by Side View

1 oz Austrian Silver Philharmonic Coin
Purity: .999
Face value: $1.50 Euro
Backed by: Republic of Austria
Ships in multiples of: 20 coins per tube (but can be purchased individually)
Distinction: One of the physically widest one-ounce silver coins currently in production.



Silver Kangaroo Coin - Side by Side View

1 oz Australian Silver Kangaroo Coin
Purity: .9999
Face value: $1
Backed by: Legal tender under the Australian Currency Act of 1965.
Ships in multiples of: 25 coins per tube (but can be purchased individually)
Distinction: Newer coins come in a high-relief design. The silver Kangaroo is also the only sovereign coin available in a “mini” monster box of 250 coins.



Silver Britannia Coin - Side by Side View

1 oz Silver Britannia Coin
Purity: .999
Face value: £2 pounds
Backed by: British Government
Ships in multiples of: 25 coins per tube (but can be purchased individually)
Distinction: Silver Britannia coins are verified at the centuries-old “Trial of the Pyx,” where a jury of assayers ensure newly minted coins conform to required standards.



Silver Mexican Libertad Coin - Side by Side View

1 oz Mexican Silver Libertad Coin
Purity: .999
Face value: None.
Backed by: Bank of Mexico
Ships in multiples of: 25 coins per tube (but can be purchased individually)
Distinction: Produced at the oldest mint in the Americas. Also, the silver Libertad is produced at the end of the year they are minted in, not the beginning like other coins.


If you want to buy silver coins, this is where to start. You’ll have beautiful coins, backed by a sovereign government, which can be easily sold when the need arises.

This isn’t to say that you should never buy other silver coins. The point is that every investor should have a meaningful stack of standard bullion coins before buying anything else. These are your safety net, a tangible monetary insurance hedge that you and your family can easily sell if the need arises.

• Investor’s Edge: The bulk of your silver coins should consist of American Eagles, Canadian Maple Leafs, Austrian Philharmonics, Australian Kangaroos, Britannias, and Mexican Libertads.

Now that we know what to buy, let’s find out where to shop…


The Best Places to Buy Silver Coins

Most silver coins are bought in one of two places: at a local coin shop, or online. (There are a few other places, too, which we’ll address below.)

Believe it or not, you’ll likely find better pricing online than at a coin shop, even after factoring in shipping costs. That’s because the overhead at a brick-and-mortar store is higher. But that’s just part of the difference between them.

Here’s the pros and cons of your two basic options…

Local Dealer

Pro
Con
Can see actual product, and take immediate possession
Premiums are likely higher for purchase, and will likely be smaller when you sell
Pricing is straightforward and transparent—what is today’s price of gold? That’s the value of your gold coin.
Likely has limited product choices
Potential for greater privacy
May have less liquidity for large buybacks


Even if you decide to buy online, I recommend checking with a local dealer, because a relationship with them can be helpful if you need to make a quick sale. If you decide to buy from them, see if they’ll negotiate on price.

Where to find a local dealer…

The easiest starting point is to use this US Mint dealer locator.

You can also Google “coin dealer” and your city or county. Adding the word “silver” may not help, as some dealers like to keep a low profile.

Online Dealers

Buying from an online seller comes with one obvious risk: you have to pay upfront, and then trust that the dealer delivers what you purchased. But this isn’t normally an issue with a well-established online dealer—the last thing they want is for word to get around that they rip people off. And if you paid with a credit card you may be able to use your bank’s chargeback policy if necessary.

And as I said, one advantage to an online dealer is that they can frequently be cheaper than a local store, even after shipping and insurance costs.

When choosing an online dealer, look to see product prices displayed on the site, along with shipping and insurance charges (you may have to search for these fees). A dealer that doesn’t show prices isn’t necessarily bad, but sometimes that means they want you to call so they have the chance to sell you as much as possible. As a result, give greater weight to transparent dealers.

Last, look for a delivery timeframe before you place an order.

Online Dealer

Pro
Con
Ability to order online and lock in price at your convenience, 24/7. Avoids talking to a salesperson
Must trust dealer to deliver precise product
Total cost is likely lower
Credit card and wire fees are extra
Greater selection
Product only ships after payment clears


Choosing the Best Dealer, Online or Local

A good way to start is to compare prices of the same product among a few dealers.

Getting a low premium is good, of course, but price isn’t the only consideration. Here’s a few other important questions to ask:

• Do they offer multiple forms of payment? Bank wire, credit card, cash, personal checks, money orders/cashier’s checks, and PayPal are being increasingly offered in the precious metals industry. And you want as many options as possible for not just current orders but future ones, too.

• What are total costs, including commission, shipping, insurance, and credit card or bank wire charges?

• How big is the company? You want a dealer that has strong volumes, because they will have greater flexibility, bigger selection, and be better equipped to fill a large buy or sell order.

• Is the dealer pushy, or educational? Do you feel comfortable with them?

• Will the dealer send you a lot of marketing materials after your purchase? You may want these to learn about special offers, but you don’t want to get bombarded or your name be sold.

• Do they offer a buyback policy? If they’re not willing to buy back what you purchase today, that’s a strike against them.

• What is the return policy if you receive the wrong product? Keep in mind, however, that you can’t return a correctly filled order due to “buyer’s remorse.”

There are a few other places you’ll see silver coins for sale, including…

TV Dealers

It’s hard to watch cable television and not see an ad from one of these dealers. But I avoid them because:

• They’re almost always more expensive. Many of them pay huge advertising and/or celebrity endorsement fees.

• They usually have minimums, which may be greater than you want to buy. Or they may make it very expensive to purchase a small lot.

• They usually try to talk you into buying numismatic coins, or more product than you want.

• They offer quirky and expensive payment plans, such as the “layaway plan” that charges interest until you pay in full.

You can avoid most of these tactics by not calling them in the first place.

eBay

I have friends that prefer buying silver coins on eBay. It’s convenient, and shipping is usually free. The risk is that your trust quotient is forced way up, since you’re usually buying from an individual (though some dealers post products on eBay).

Since many eBay buyers are investors who know exactly what they want and know a good deal when they see it, I recommend you don’t start with eBay until you get more experience and knowledge about silver coins.

Coin Shows

Most coin shows focus on collectable coins, not bullion. I’ve been to many shows over the years and frequently can’t find a one-ounce silver Eagle, the most common coin in the world! You also have to travel to the show, which takes time and costs money (which you could otherwise invest in silver!)

Buying at a coin show is not for a novice and not an ideal way to buy bullion. They can be a fun event if you decide to become a coin collector.


Banks

It depends where you live. If you’re in Europe or Asia, check with your bank. Some banks offer silver products to retail customers. I know several people that have done this very thing in Switzerland, for example.

To find out if a bank offers silver coins for sale, just give them a call (it may or may not be well-advertised on their website, for security reasons). One caution: make sure you compare premiums, so that you’re not being overcharged. Also, inquire if they offer lower rates to existing customers.

If you live in the US, it is a common misconception that you can buy silver at a bank. Many people expect a bank to issue silver, since our currency used to be made of silver. But today most physical silver is purchased from non-bank distributors. Even the US Mint requires retail customers go through an “authorized purchaser” (although you can buy proof products at the Mint).

Investor’s Edge:You will likely find the best pricing online than at a coin shop, even after shipping costs. But it pays to shop around the first few times until you find a dealer you’re comfortable with.


Don’t Get Ripped Off! 

The #1 way to avoid getting ripped off when buying silver coins is to shop at a highly reputable dealer.

And the way to find a reputable dealer is to follow the checklist above. Your basic goal the first time through is to do enough of your own due diligence so that you have a place to return the next time you’re ready to buy. So…

Check a company’s reputation and complaints at the Better Business Bureau or Trustpilot. Check the peer reviews. Here is GoldSilver's TrustPilot rating:

Trustpilot
Understand all your costs upfront—commissions, shipping, insurance, and any extra charges for credit cards, bank wire transfers, etc.

Look for those that have a guaranteed buyback policy. You’re looking for a dealer who’s not just willing to repurchase what they sell you, but one that is likely to remain in business. Here’s a way to confirm that their buyback policy is real: ask what their current “buy” price is on the product you’re thinking of purchasing.

Whatever you do, buy! You’ll love the weight of real silver in your hand, and will possess a hard asset that can last generations and protect your portfolio against whatever the economy and markets may throw at us.

• Investor’s Edge: Use our checklist to identify a dealer that will give you a fair price on silver coins, is educational, has good reviews, and offers a buyback policy.