Buying Silver 101

Welcome! I’ve always hated “Investment” guides which don’t explain why a certain investment works, or how well it works. Sometimes a topic is just as mysterious after you read the guide.

My guide is different. I explain exactly why physical silver is a good investment and the best ways buy silver. If you buy bullion on eBay, I will show you how to save hundreds of dollars on your silver purchases, allowing you to convert your cash back rebates into “free” bullion. You’ll also learn exactly when to sell your silver. And I not only give you meaningful tips for slashing your costs of buying physical silver, I give you the tools and information to find the right silver on the market to invest in. Finally, I’ve answered dozens of questions about buying physical silver. If you have a question, it’s probably answered somewhere here already.

Buying silver doesn’t just preserve your wealth, it also offers fantastic opportunity! This is news to a lot of people. Most people in the United States know very little about owning physical silver. After all, you don’t see T.V. commercials about buying silver bullion and coins, like you might with gold. The talking heads on the financial news might have a sentence or two to say about the rising gold prices, but have little to say about silver. The fact is, that while all the precious metals have performed spectacularly over the past two years, it just so happens that silver has outperformed gold since 2008. Most people believe gold is much more rare than silver, and they are right – to some extent. There is more silver above ground than gold, but the vast majority of it is in industrial use or other unrecoverable forms. In terms of actual physical investment bars and coins available for you to purchase, silver is much more rare than gold (See my Why Silver? page for the numbers.)

But don’t just take my word for it. The US Geological Society recently reported that silver will be the first element on the periodic table to go extinct. The USGS said that this could happen by the year 2020! That’s because, as they say, we are using up silver faster in industry than we can dig it out of the earth. Global geology experts agree that there are no new large silver or gold deposits left on earth to be found, and the global reserve supply of silver is dwindling fast. We may truly only have 10-20 years of available above-ground silver to meet industry demands before we run out. (Read more on the industrial uses of silver)

Silver has maintained a 16:1 price ratio to gold for thousands of years. But after the world’s governments moved off the bi-metal gold and silver standards and into a fiat system of printing money backed by nothing at all, the gold to silver ratio (GSR) has fallen to around 50 ounces of silver to 1 ounce of gold. This ratio has been suppressed purely by manipulative forces of the large banks who are shorting the physical metal on the markets to artificially suppress the price. The world is waking up to this manipulation, however, and the ratio is rising again. Many precious metals experts agree the free market will win out over the manipulation as it always does, and the ratio of will return to its historic 16:1 ratio. You can make magnificent gains by buying the artificially cheap silver now and cashing it in for gold when the ratio returns to what it has been for all of human history!

Note also that as the age of the US Dollar is coming to a close The world has a new reserve currency every 40-50 years, and we are due for a new one. The reserve currency is the agreed-upon standard currency used in transactions between governments, and it is the currency of the global economic power of the time. Come and gone are the time of the British Pound Sterling and the US Dollar, as the new global economic power is China. The same China that invented paper money, and who have seen more paper inflation cycles than any society on earth. The Asians know what true money is, and that is silver and gold. China is already the world’s leading miner of silver and gold, and they have just become the world’s largest buyer of gold and silver bullion on the world markets. You would be wise to do as they are and think ahead – buy silver now while it is still available and affordable!

Thinking about buying physical silver? Silver is indeed still affordable for almost every American family. While I believe gold is a great investment and store of wealth too, my concern about this is that most people are not going to be able to afford gold, especially as the US dollar continues to decline and inflate away with the money printing policies of the Federal Reserve Bank. Silver is an affordable option for every American who is looking for an alternative investment in these uncertain times. As most Americans go on blissfully unaware in their blatant consumerism, you can be prepared with a better approach – stop wasting money on cheap foreign made products and buy real hard assets!

In reality, owning physical silver is pretty easy; the problem is that most people don’t know how to do it. That’s why most people live paycheck to paycheck, or blindly trusting their meager savings in Federal Reserve notes. Maybe you’ve thought about buying some shares of “paper” silver, like the SLV ETF. Well, I hope after you do some reading on this website you will reconsider and purchase physical silver instead. We live in an amazing time – you can have as much physical silver as you can afford delivered right to your doorstep without ever leaving your house. Sadly, most people will never bother to learn about silver. When the US Dollar collapses, they will be woefully unprepared.But you’re here, you’re reading this, so you’re the kind of person willing to think for yourself and learn the truth about money. And the time is right, too.

If you really want to jump in and start stacking silver, you’ll also want to look into large reputable online bullion dealers like Apmex and consider finding a local coin or bullion dealer you can trust.

I hope you find this website useful. Happy stacking!
— Mr. Silver AG
Precious Metals Maniac

Lesson #1: Always take physical delivery

Before we get to the tips on specific ways to own silver, remember one simple thing: Real money is gold and silver, only. Paper assets like silver ETF’s, and fiat currencies like Federal Reserve notes are poor substitutes for real money. The paper markets exist to enslave the people while the financial elite collect the real wealth from the masses. Silver ETF’s are likely being criminally manipulated, and holding paper silver will do you no good at all in a SHTF scenario.Owning the real physical metal is the only true way to protect yourself with silver, and is the only way I can recommend to anyone who is interested in silver investing. But don’t worry, there are many different ways to own physical silver, and there is bound to be something that fits your needs and that you’ll treasure owning and sharing with your friends and family.

• Silver American Eagles
• Foreign silver coins
• .999 Fine silver bullion bars
• 90% “junk” silver coins
• Sterling silver dinnerware
• Silver jewelry
• Scrap silver

Lesson #2: Don’t overpay for silver

Silver is silver is silver: The reasons that silver and gold have been money for thousands of years of human history is because they have the properties of money. And the number one property of money is fungibility (uniformity). Fungibility means a certain weight or measure of a product has an equal value to any other equivalent amount of that product. Gold and silver are fungible – your US Silver Eagle coin isn’t any different than one held by a coin dealer in Canada or one stored in a vault in Switzerland. Your 10 ounce Silvertowne silver bar contains the same amount of .999 fine silver as one made by Engelhard, or Apmex. It is worth what 10 ounces of silver is worth, nothing more, nothing less. Diamonds and snowflakes, for example, are not fungible because each one has unique qualities and characteristics, and one diamond may be more valuable and desirable than another, and thus you could not make an equal trade.

When buying physical silver you must always know the current spot price of silver when you go to make the purchase. Do not overpay or get attached to any one particular silver bar or coin. Your goal should be to find deals on silver and buy at spot price, or lower if you can! eBay is a competitive market and silver coin and bullion auctions are watched by thousands of buyers 24 hours a day. However, that does not mean you have to overspend on common bullion or government mint coins. On eBay you can often buy silver at spot or even a little under (especially when using rebates! More on that next)

Lesson #3: Always use rebates available to you

Using rebates on eBay and credit cards can save you SIGNIFICANT money. When buying physical silver, you should always be looking to save every penny you can so you can maximize your total ounces owned. eBay offers its own cash back program called eBay Bucks. This is free to join and you should certainly do so. eBay Bucks will give you 2% cash back on all your eBay purchases, payable after 90 days.

You can stack eBay Bucks with Mr. Rebates.com for even more money back! [edited July 2011 – Unfortunately eBay has discontinued additional rebates like MrRebates.com]

Use a cashback rewards credit card. If you have a cash back rewards credit card that give you a 1% (industry standard) rebate on all purchases, you can by all means use it to pay for your eBay purchases through Paypal. Therefore you will get an additional 1% stacked on top of your eBay Bucks and Mr. Rebates money. All these stacked rebates can bring down your total cost of owning silver a very significant amount. I do not suggest you go heavily into credit card debt to buy silver, however. Only spend on your credit card what you can afford to immediately pay off. This is just a play to gain an additional 1% off your silver.

Read on to learn what the best forms of silver to invest in are.