Investors: Silver was down to $23 the other day. It’s back up to $24. Not a super bargain price but still a good time to get back in if your looking for a safe place to put your money.
Why save in silver and not invest? Ok guys this is important I see tons of materials trying to convince people to “invest” in silver based on it’s price, scarcity and where it is going. I want to point out that this is technically investing but it is investing for capital gains. Moreover you would be investing for Capital Gains on a product you have no business, production or market control over. To sum this up buying silver “hoping” the price will go up is gambling! It would be the same as “investing” in a stock and hoping the share value goes up. Yes it can be done and you could make a lot of money on it. The same could be said about Roulette. At least there you would *know* what your odds really are.
Saving not investing
Wait huh, this sounds like you are against silver? No I’m not, I promote saving in silver not investing. You have to understand the different goals of saving and investing. With savings you are placing your money into an “investment vehicle” whose main purpose is to *hold* value. In other words beat inflation, avoid market crashes, and in the case of silver avoid currency crashes. It is very important to save money. Sadly most people are saving their money in US dollars (bank accounts) which is subject to A: Exchange rate fluctuation and B: Inflation. It would be wiser to at least diversify your savings and place a portion of it in precious metals.
What is investing?
With investing you should be placing your money into an “investment vehicle” that offers some kind of monthly, quarterly or annual returns. One of the best “safety measures” for this kind of investment is the ROI (the yearly return after all expenses). The higher the ROI the faster you earn back your initial investment. It doesn’t matter how “safe” something is, if it takes 20 years to earn back your initial investment that’s a weak ROI and you are screwed when the related market crashes. This is why you should not invest in stocks if you cannot earn back your initial investment in less than 10 years. Different segments of the stock market crash every 10,15 and 20 years. Important: Notice I said “initial investment” not total cost. In the case of real estate you use money down + a loan. What you look for there is how fast you get back your money down (the cost of investing) and to make sure you have a positive cashflow above the loan payment. This is pretty advanced stuff though so you should find a mentor before diving into it.
So what about all those books and websites that promote investing in silver, what’s their deal? Every single one of those “experts” encouraging you to invest in silver are somehow tied a website or refiner that sells silver. In other words they don’t want to teach you how to increase your financial knowledge, as much as they want to sell you on the idea of buying silver from them. It’s the same with Realtors that try to convince you that “buying a house is a good investment”. They want you to buy a house, and it *can* be a good investment if you have a clear plan on how to rent it out, but what they really want is for your to buy a house from them. They don’t care if it’s a good deal or not.
Where to buy silver?
Just call 3-5 local coin shops, ask them how much they are selling Silver Eagles and Silver Rounds for right now. Once you find the best price, ask how many they have on hand (you will be surprised how often they say “0, 5, only a few”) then tell them how many you want and what time you will be there to buy them and make sure you bring cash they won’t accept check or credit card. I’m serious about that last part it is important, too often I didn’t tell them how many to hold back for me and by the time I made my decision and went in to buy they were sold out.