How to buy gold in Canada
I will name 3 ways to buy precious metals in Canada and their pros and cons. I have used all of them myself.
This is a gold coin with a 999, or 24-carat proof, and a silver coin. Today I will talk about buying precious metals in Canada in order to use them in the future. For example, during retirement or just to fight inflation.
Many people live for today and give little thought to the future. If you mindlessly spend the money you earn, nothing good will come of it. The option of saving is better, but when governments just print money, its value falls due to inflation. To combat this, I invest in securities, with excellent results so far. For example, my investments in the S&P 500 fund have doubled in about 5 years.
Someone will say that it is more profitable to invest in real estate, not in securities, someone will be for gold and silver, well, I think young people believe in cryptocurrencies.
What to invest in
Let me quickly compare investing in precious metals with the S&P 500 fund, which includes the 500 largest American companies. Let's imagine three friends who invested in different assets 10 years ago: gold, silver, and stocks. Who do you think would make the most money if they decided to sell everything? The bad news: silver is down 19%. Gold increased in price by 18% — seems like a good thing, though for 10 years it could be better. Stocks flew into space — they went up in price by 215%.
If you take longer-term investments over 30 years, silver has slightly outpaced gold in income over the interval, but stocks are still 2 times ahead of precious metals.
An attentive reader may now ask why I bought gold instead of stocks, if historically the stock market brings in more. The answer is that it is all about security. Recent events have shown that investments in securities, and even just deposits, are just numbers in a computer. Not too long ago, there was a Liberty protest in Canada and its organizers just had their accounts closed, they couldn't withdraw their money.
The Moscow Stock Exchange was temporarily closed due to the well-known events, and you could not sell your assets. Withdrawing money was also difficult. If you save for many years and constantly save, and maybe you won't be able to use your savings — that's complete nonsense, don't you agree?
When you buy gold and silver, they are physical commodities that are harder to take away from you and easier to move to another country or city. That said, precious metals are worth a lot and are easy to get money for. At least in Canada, it is very easy to sell gold or silver.
In general, you probably won't make much money buying gold bullion or coins, but it's probably better than just keeping money under your pillow. As I said, there is a lot of inflation in Canada, and in other countries, right now, and precious metals are getting more expensive. So the liquidity of silver or gold is good, and it's better to keep a part of your savings in them, for instance 10% of your investment portfolio. Here it should be noted that I am not a financial consultant and I am not selling you anything, I am just sharing my experience.
How to buy precious metals
The first reliable way is to go to specialized stores. They are very easy to find on Google maps by entering the phrase "coin shops" or "coin dealer" into a search. I bought a gold coin from Ottawa Gold, they have several locations in Ottawa, one of which is in a regular mall. The guys sell gold or silver for cash, you can also pay with a debit card. They didn't even give me a receipt, just a coin in a bag. I asked to check it, they weighed it in front of me and checked the density.
Unfortunately, prices in Ottawa are higher than in other cities, for example, in Vancouver you can buy this coin for $50 cheaper. To avoid going to another province, you can use online stores. This is the second way to buy gold in Canada.
Specialized online stores have a substantially larger assortment on investment bars or coins. You can buy popular items from all over the world: American Eagle, Gold Buffalo, Australian Kangaroo, Britain, etc. It's also easier to keep track of promotions on websites, for example, I bought a bar of silver at a discount. It's 10 times heavier than a gold coin, but still 6 times cheaper.
If you pay online with a credit card or PayPal, the price will be a little higher. In many places you can pay with bitcoins, but I do not have them in pure form, only in the form of shares. In the time since I invested there, I'm in the black and what's nice is that I don't have to pay taxes when I sell later.
By the way, when you buy coins or bullion, no additional taxes are added if it is pure gold or silver. On my coin it says 9999 which is 99.99% gold purity, on silver 999 which is 99.9% purity.
The main disadvantage of shopping at the specialized sites is that you have to wait, usually about a week or two for delivery. On sites with low prices shipping will cost about $30. If the prices are higher, then the delivery can be free when you order, for example, from $300.
Popular sites for buying precious metals:
The third way to buy gold or silver in Canada is to buy on eBay, the largest marketplace chosen by collectors. You can buy not only investment coins, where just the weight of gold or silver is appreciated, but also ancient collectible ones. I don't understand anything about that, so I don't consider buying collectible coins.
On the other hand, if you're into the subject, there's a lot of interesting stuff out there. I didn't know that until 1968, regular coins in Canada were made with a high proportion of silver. Now precious metals are only in such special coins. In theory, I could pay in a regular store with my gold coin, its declared value $50 CAD. This silver one has $5 CAD, even though I bought it for $43. Also note the density of the gold and silver. My coins weigh the same, 1 troy ounce or somewhere around 31.10 grams, but the gold one is much smaller.
Back to eBay. You can get hung up on the huge selection on this site, but there is a risk of getting caught by scammers who will sell you a fake. Don't chase the small price if you come across it, gold or silver can't be cheaper than the market if you count by weight.
I will also tell you about a fourth, bonus way to buy gold in Canada — through Canadian banks, but I have not personally used it yet. This possibility was in CIBC and TD Bank, the other big ones probably have it too. Right on the bank's website, you can choose a bullion or coin and purchase it at the branch. You can only pay with your bank account. The prices are quite competitive.
Alex Pavlenko, founder of Immigrant.Today