Saturday, March 11, 2017

Physical Gold and Silver, the Whats and Hows – Part 3

In this final part about physical gold and silver, we will look into how to maintain, keep and store your bullion.


Bullion bars come in two forms; cast and minted. Cast bars looked like bricks and are considered “no frills”, having being produced from a simple mould and come with no packaging. Some bullion dealers would shrink-wrap the cast bars to protect them.

Minted bars are more refined looking, typically engraved with the refinery’s logo and come with packaging. It is advisable not to remove the bars as most dealers prefer to buy them back with the original packaging.

For bullion coins, they come in tubes of at least 10 from the mints, but individually they could be packaged with coin capsules at a small cost.


Tarnishing is the corrosion of the outer layer of a metal, and silver, though a precious metal, is susceptible to it. A tarnished silver bullion does not sit well with dealers when you want to sell it back to them, therefore it is necessary at least to have packaging for your silver bullion to protect them. Storing them properly would prevent tarnishing further, and if possible surround your silver bullion with desiccants like silica gel and/or anti-tarnish strips.

Storage Options

There are three main types of storage options available for physical gold and silver, all based on locale. The first one would be at your own home, and safes, dry cabinets and dry boxes (the latter two used for storing photographic equipment) are ideal. These would help protect your silver from being tarnished, and for safes the additional advantage would be protection from fire. Place them in inconspicuous parts at your home like in your bedroom or store room.

The second option would be safe deposit boxes. They are like safes, but located typically within a bank or financial institution, hence there is added protection and security. The contents of the safe deposit boxes are only accessible by the owner, thus a high degree of privacy. Rental costs for the boxes are dependent on their sizes, and they are usually payable on an annual basis.

The third option would be storage facilities (or vaults) offered by bullion dealers. Similar to safe deposit boxes, the storage facilities are located within a highly secured premises. To add, most of the dealers allow you to transact your physical gold and silver and have them bought into or sold out from the vaults themselves.

Storage does incur costs, from the sunk costs of getting the safe and dry cabinet or box, to the recurring costs for the safe deposit boxes and storage facilities (and also electricity for the dry cabinet, though that is almost negligible).

And so we come to the end of the whats and the hows of physical gold and silver. I hope the three parts would give you a good insight of investing in gold and silver bullion within your Bedokian Portfolio.

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