There is an ongoing debate over whether investing in precious metals is worthwhile. In one camp there are those that say it is, those that swear by silver and gold as a sound investment. In the other camp there are those that say gold and silver stackers are just throwing their money away.
Personally, we think that investing in gold and silver is a wise choice to make. It depends on the current market prices of course, but right now, for instance, is the perfect time to sink your money into silver. With that in mind, there are a few things you need to look out for to ensure the value of your stack, and the main one of those is whether or not the silver you own, or are planning to buy, is real. There is a lot of fake silver out there and it comes in many forms, so how do you ensure that your silver is real?
One of the easiest ways to ensure that the silver you purchase is legitimate, is to make sure you purchase from a reputable dealer. If you have been involved with precious metals for some time, then you will know who the biggest and most widely used dealers are. If not, then you just need to do your research. If they sell dodgy silver, then there’s a good chance there will be a lot of bad reviews out there, the same goes for if they are known for poor delivery or customer service. You should also check that they are based where they say they are based.
There will be times when you need to use other sites and even auction websites. In these cases it is hard to verify buyers. When it comes to eBay sellers, you should never assume that the silver they sell is legit just because they have tens of thousands of good feedback. They could have sold anything to get that feedback and they could have also duped a great number of people. If they have been selling silver since day one and have all of that feedback from silver sales, then you should be okay. However, the best deals often come when you venture away from reputable dealers, and we would recommend that all silver stackers try this and incorporate silver bought this way into their stack. If you follow the instructions below when purchasing such silver then you should be okay.
Don’t be Tempted by Overseas Dealers
In the UK we pay a huge 20% VAT on all silver purchases, which pretty much negates the whole point of silver stacking in the first place. Because of this, there are a lot of stackers that go out of their way to find alternative methods. eBay is a good one, but it does not come without risks, as we shall discuss later in this article. Many stackers also turn to US dealers, and to dealers in over countries that do not have such a tax on silver.
By all means buy silver from Europe. Germany is a great place to buy it from and one that many stackers use. However, whilst you might get a wider choice and a cheaper price on major US sites, you will be stung in the end. Germany and other EU countries pay VAT on silver, it’s just such a small amount that you barely notice. In the US, they don’t, and you are eligible to pay it if customs catch a shipment of coins coming into the country. You will also pay a large sum for the shipping.
So, in the end, as well as forking out a few hundred dollars to ship over a large quantity of cheap silver, you may also be forced to pay the 20% VAT on top of that, putting you out of pocket, even more so than if you had just ordered from within the UK in the first place.
Stick to Big Mints
There are several top mints that are respected and known for producing high quality silver. These include the Royal Australian Mint, the US Mint, the Canadian Mint, the Royal Mint (UK) and a few others. If you get silver that bears legitimate stamps from these mints then you are assured the highest quality.
The same goes for certain labels and stamps. If you see something that looks interesting and unique, be wary. Do your research on it to find out if it is a genuine stamp and not just a fake slab of silver with a random design that was created to dupe stackers. eBay traders do this a lot, they stamp bars with images, slogans and logos of big brands, films, bands and more, all with the hope of attracting a buyer that wants a unique piece. More often than not though, these are just silver plated or are 100% tungsten or some other cheap metal.
Run Your Own Tests
There are many ways you can test that the silver you buy is real. The issue with any of these is that you can only run the test after you made the purchase. However, if you bought on eBay or you used PayPal or a credit card, you can always get a chargeback if you have been ripped off.
The easiest way is to use neodymium magnets. These are very cheap, often a few pence each, and they react in a very unique way when they encounter silver. Using these magnets is a cheap way of checking your silver, and one that doesn’t harm your silver or reduce its value in any way. There are many other ways to check, and we have listed many of them in other articles on this site, but this is the best.
If you purchase silver very cheap, then you probably won’t care even if it turns out to be fake. The goal here is to find silver being sold by someone who doesn’t realise that they have a silver product. They could be selling old cutlery sets, jewellery coins or even bars. You would be surprised how much you can pick up in charity shops, car boot sales and other such places. If the item is not particularly attractive, and if the seller isn’t clued up when it comes to detecting precious metals, then it could be sold on aesthetic value alone. If you really want to push your luck then you can take some neodymium magnets out with you, testing products that you suspect are silver, before driving a hard bargain on said product.