So you have understood that investing in physical gold is the way to go. Next question then is how to store your gold. With this blog post I want to answer the questions of how to store your gold coins and how to store you gold bars.
Knowing where to store your gold has been a problem for a very long time. Trying to solve this problem was actually how we came up with paper money (the paper dollar bills on your wallet).
I thought that would be an interesting thing to go over shortly first. I apologize for this ”fun” fact and if you want to get straight into where to store your gold just scroll down to the next heading. But I think you will really enjoy it.
Why do we have paper dollars in our wallets?
In the beginning of time most trade were done using gold coins. I’m sure you’ve seen movies where the people carry around a pouch of gold coins. These actually contained physical gold.
People were always a little bit afraid to carry their gold coins with them and it also wasn’t too practical. It was a bit heavy so they thought that there has to be a better way. The solution was to deposit your physical gold at a big institution that had a big vault. Yeah you guessed it, banks.
Now you didn’t have to carry around the ”heavy” gold and you didn’t have to worry to much of being robbed.
Once you had deposited your gold into your bank you got a note back from the bank. A gold certificate that said how much gold you owned. After a while when the people had started trusting these bank institutions they actually started to trade with their gold certificates. Instead of having to walk to the bank and get some of your gold when you wanted to buy something you just gave the other person your gold certificate.
Then he could either go cash it in for gold or use that same certificate in trade as well. The longer the time went the more people started to trade only in these gold certificates, so the banks realized that nobody ever came to claim their physical gold.
This opened up a huge opportunity for the bankers. Because everybody now saw these gold certificates as real gold they could just print more of them and go buy things. Say that a banker wanted to buy a house. He could print these gold certificates and pay for his house. The owner of the house would gladly take these gold certificates because it’s just as good as gold right?
So the currency you have in your wallet use to be gold certificates. If you look at old US dollar bills it will say that it’s a gold certificate. Basically you could take your gold certificate (dollar) and walk into any bank and trade it in for physical gold. Look at the note below and you’ll see.
In the late 1960 people started to realize that the US printed more gold certificate (dollars) then the had gold in their vaults. This created a panic and lots of people and countries tried to exchange their paper dollars for gold. This was about to drain Fort Knox of gold so president Richard Nixon had to stop the convertibility in 1971.
Now the dollar was not backed up by anything. Now it’s a certificate of trust. You have a certificate that you trust the US government to keep the value stable on the dollar. These type of currencies (certificates) are called fiat currencies. There has been thousands of fiat currencies throughout the history and they all have one thing in common.
They all went to ZERO. Became worthless. Because it’s just paper, just like monopoly money is.
This is why we will see a currency crisis in the US dollar soon. If not then the dollar will be the first fiat currency in the world to survive. And I don’t think so, it has been tried thousands of times and failed every time. The dollar will also fail.
So don’t hold the certificates. Hold the actual physical gold in your possession and you will be 100% protected from the coming currency crisis.
Okey, I get it. So how do I store my Gold?
If you read the ”fun” fact about how our paper money comes from trying to solve the question of how to store your gold then you might have an idea where I will go. If not, let’s look at the different possibilities so you later on can decide what fits you best.
In a safe deposit box
Many people often think of a safe deposit box as a ”safety” deposit box which is wrong. It’s a box where you can deposit things that are kept in a safe at the bank. Therefore it’s called a safe deposit box.
People often think of a safe deposit box to be the best place to keep your gold and silver. I would disagree and here is one of the reasons why.
During the terrorist attacks at September 11, 2001 gold rose 9% and silver rose 11%, but if you kept your gold in the bank you couldn’t get to it. The stock market was closed during that week and so were the banks. The ATMs quickly ran out of money. So during the time where you really needed to get to your gold you couldn’t.
If you would have had the gold in your possession you could have walked into a precious metals dealer and traded in your gold for $100 bills to buy food, gas and the other necessities that you need but was hard to get during that standstill. During a crisis like this it’s very important to have some physical gold in your possession so you can still put food on the table for your family. That’s why gold is seen as a safe investment.
Another important thing is that safe deposit boxes are actually not insured. Most people think that the government or the banks insurance will cover it, but it doesn’t. Any bank robbery or other things and your gold is gone.
The most important thing when you invest in physical gold is that your investment becomes completely private. Nobody knows about it and it’s outside of the financial and banking system. But if you choose to store your metals with a bank you’re exposing the most private of investments to the most public financial and banking system and all the laws that governs them.
Store it at home
Lots of people think that this isn’t a good idea. There is nothing wrong with storing your gold at home if you don’t have millions in gold. Gold stores a lot of value in a very small amount of space so I’m sure you can find a safe place in your home where you can hide it.
Remember, nobody knows that you have this investment because it’s outside of the financial system. So no burglar will come knocking on your door asking you to give up your gold.
If you have a lot of gold at home maybe you can consider a safe (definitely not a must) . Talk to a safe expert close to you to get that sorted out.
The beauty of having the gold at home is that you have it in your possession. So if a thing like 9/11 happens, or anything else that will shut down the banking system, you can still get to your gold. That way you have value and can buy all the necessities to survive.
Also remember that when you have your gold at home you don’t have any insurance on it. So if you lose it (don’t know how that would happen) there is nothing you can do. A great thing is that gold and silver melt at a very very high temperature. So they would survive a house fire.
Segregated Vault Storage
This is the highest level of security available. These are companies like Brink’s which are the ones that got armored cars that deliver money to the banks. These companies are not part of the banking system and are not operating under the same laws. So during 9/11 these vault companies were still open.
Once you have brought them your gold and silver it will be accounted for by two parties under video surveillance. After that it is sealed in a box and put away. When you call up 10 years later and ask for your gold back you actually get exactly the same gold as you put in your box.
The gold is allocated to you and is not an asset of the vault storage company. This means that if the vault would file bankruptcy or close for any other reason the gold is still yours.
This can be a good idea if you have a lot of millions in gold that you want to store with the highest security available. Obviously you have to pay a storage fee for this.
I hoped you enjoyed the little fun fact of how the answer to the problem of how to store gold coins was how paper money got created.
It’s okey to store you gold and silver at home. Just hide it. Because the gold is not part of the financial system nobody really knows that you own the gold. If you have a lot of gold you might want to consider a safe.
Be careful if you want to store your gold at a safe deposit box in a bank because it’s not insured and it’s part of the financial system. In case of an emergency where you need to get a hold of your gold you most likely will not be able to.
If you have millions of dollars in gold you might want to consider a segregated vault storage. This is the highest security you can have for you gold holdings but it comes with storage fee’s.
I hope you found this post helpful and if you have any questions or input please leave a comment. Now that you know that it’s okey to store your physical gold at home, are you ready to start transfering declining paper dollars to hard physical gold bullion?