What is the cheapest way to buy gold?

The short answer here is that gold bullion bars are cheaper to buy. However, there is one thing about buying gold bullion at low prices that most people won’t tell you. The secret to cheap gold is paying the lowest possible premium per unit of weight, which is not always evident from the price of a finished gold product. It’s a pretty simple concept, but it’s easily overlooked.

The Cheapest Kind of Gold to Buy

As mentioned earlier, gold bullion bars usually have the lowest premium to the spot price. The premium is defined as the cost that is above the melting value of a gold item. You can think of it as a “markup”.

There are several trusted brands like PAMP Suisse gold bars that you can buy.

Remember that you can practically never be able to buy gold bullion at spot.

High premiums correspond to the cost of refining, manufacturing, and shipping the gold, as well as the old bullion dealer’s profit margin. This is in part why gold jewelry and gold artworks cost so much more than gold bullion bars.

It makes sense to use the premium as an indicator of how inexpensive or pricey a gold product is.
“Spot” refers to the spot price of gold at a given point in time.

Calculating the premium over the spot price does away with any confusion about the total price of an item. Do tis before you approach a bullion dealer. Most often, the premium is calculated proportionally to a troy ounce, the standard measure of the weight of precious metals.

Gold bars usually have the lowest premiums over spots because of their general appearance, so they can be mass-produced efficiently. But supply and demand for certain products are also important. Sometimes old gold coins offer the best “return” based on market availability. Just be sure to stick to popular dates that are not in perfect condition. Rare or well-preserved gold coins cost more and more. The same applies to modern gold bullion coins such as Canadian Gold Maple Leafs, The Austrian Philharmonic, or the South African Gold Krugerrands.

Buying in bulk is practically always cheaper. Most merchants offer a lower premium per ounce (or another unit of weight) when you buy a certain number of bars at a time. This concept generally applies regardless of what type of gold you buy.

The Best Place to Buy Gold

You may be wondering if certain countries are cheaper to buy gold. Prices may be low or high depending on where in the world you are buying your gold from. This also depends on the availability and local demand. Between travel, shipping costs, and import duties, you’ll find that buying gold in another country doesn’t necessarily end up saving you money. In terms of the best places to buy gold, a local bullion dealer is always best.

Safety is also an important aspect when buying physical gold. In this regard, buying from a professional retailer is much safer than other alternatives. Overall, gold has proven to be a stable and safe investment for many decades.