Posted on June 03, 2022
For thousands of years, gold coins have been a currency used within and among nations and cultures spanning the globe. Today, modern gold coins are minted by a number of nations for collectors and investors. Though they’re no longer used in everyday transactions, the modern gold coin collector has a wide range of options. With so many gold coins to choose from, how do you know which gold coins are best to buy?
In this guide, we cover everything you need to know before making a gold coin purchase. So, stick with us to learn all the ins and outs of buying gold bullion coins.
Gold bullion coins are often a top choice for investors because gold is widely considered to be a safeguard against economic turmoil. In addition, gold coins and the mint that made them are easy to recognize, making them easier to identify and sell than an obscure medallion, round, or bar. While platinum and palladium coins can be good investments, gold tends to be more stable and there is a stronger market for it.
Compared with silver coins, gold coins are more compact (in other words a higher value per ounce) and resistant to tarnishing, so you can enjoy a more transportable, more durable investment. Finally (and uniquely among precious metals), gold has a buttery yellow color that’s instantly recognizable.
Buying gold coins is an experience that’s unique to every individual. You can use the following criteria to help you decide which gold coins are best to buy.
You’ll likely want to start with a well-known mint whose reputation is rock solid. Some examples of globally recognized world-class mints include the U.S. Mint, the UK’s Royal Mint, Royal Canadian Mint, and Australia’s Perth Mint.
Gold coins vary in price depending on their size/weight. From the fractional 1/10 oz coins to the standard 1 oz gold bullion coins, you can choose which price and size work best for you. As with other bullion products, fractional coins tend to demand a higher premium over spot price than larger coins. If your goal is maximizing your purchasing power, 1 oz gold coins generally have lower premiums over spot price. However, fractional gold coins can be useful as a bartering tool – and, despite the higher premiums, lightweight fractional gold coins are simply more affordable. (Not everyone can afford to buy an ounce of gold at a time.)
Among less-than-1-troy-oz fractional weights, the most common is 1/10 oz. Other weights do exist (usually 1/2 oz, 1/4 oz, and 1 gram) but are often produced in lower numbers. Fractional gold coins from world mints often don’t make it all the way to the U.S. because there’s such a huge domestic demand for them.
Some gold coins, like American eagles, are 22-karat (0.9167 pure) gold, offering more durability, but a lower purity. Other coins, like the Canadian maple leaf, offer unparalleled fineness at 0.9999 pure gold but are much more prone to scratching and damage. Regardless of a coin’s purity, the weight of precious metal is the same – which solves the riddle of why the 1 oz American gold eagle weighs more than one ounce. The “weight” of a coin refers to its weight of precious metal only, not its overall mass.
If you intend to invest in gold coins with tax-sheltered retirement funds, you have to make sure those coins are IRA eligible. Generally, the IRS requires gold coins invested in an IRA to be at least 99.9% fineness, with a single exception for gold American eagles. (The South African gold Krugerrand, as an example, does not qualify since it is 22-karat gold – and most premodern gold coins like the 20 francs Marianne or the British sovereign don’t meet this purity criterion either.)
Sometimes, popular gold coins can sell out quickly, making them difficult to find. Unless you’re willing to wait, availability can dictate which gold coins you’re able to choose from. Especially when you’re shopping for lighter-weight fractional gold coins, which, as we mentioned previously, tend to be in rather short supply.
There are several popular, well-known choices when it comes to buying gold coins. Based on BullionMax sales history, these are the best gold coins to buy – or at least the most popular.
Gold American eagles are the top-selling gold coin and are sure to be a safe bet for just about any investor. American eagles come in 1/10 oz, 1/4 oz, 1/2 oz, and 1 oz weights and feature the nation’s symbol – the bald eagle – on the reverse, with the legendary Lady Liberty design by Augustus Saint-Gaudens on the obverse.
As we stated before gold eagles are 22-karat gold or 0.9167 purity. But despite their purity, a 1-oz gold eagle still contains 1-oz of gold. Its actual weight (if you were to place it on a scale) is 1.0909 troy ounces– the “0.0909” extra ounces is the weight of the other metals in the “crown gold” alloy.
The 1 oz weight is the leading seller, closely followed by the 1/10 oz weight. Both 1/2 and 1/4 oz coins are less common, simply because U.S. Mint makes fewer of them. Here are the 2021 mintages for American gold eagle coins in bullion grade:
American buffalos are another popular gold coin, featuring James Earle Fraser’s 1904 Indian Head Nickel design. On the reverse, also designed by Fraser, stands an American bison. American buffalos only come in a 1 oz coin size, and, unlike American eagles, are made of 24-karat gold– a purity of 0.9999.
We believe the gold buffalos are the U.S. Mint’s answer to the gold Canadian maple leaf coins, which boast the same 0.9999 purity.
Gold Canadian maple leaf coins are renowned for their security features and high purity. These coins are 99.99% pure gold and come in 1/10 oz, 1/4 oz, 1/2 oz, and 1 oz weights. The gold maple leaf features Queen Elizabeth II of Canada on its obverse, with the famed national symbol – the maple leaf – on its reverse.
Made by the Perth Mint, Australian gold kangaroos are 99.99% pure and bear the image of Queen Elizabeth II on the obverse and a design featuring its namesake, the kangaroo, on the reverse (specific design varies by year). Throughout their 35-plus year history, Australian gold kangaroos have been minted in 1/20 oz, 1/10 oz, 1/4 oz, 1/2 oz, 1 oz, 2 oz, 10 oz, and 1 kg sizes.
Once the de facto king of gold bullion coins, South African Krugerrands are still among the top gold bullion pieces made. By 1980, the Krugerrand accounted for over 90% of the world's gold coin market, and over 60 million ounces of Krugerrands have been minted and sold worldwide (actually, a whole lot more, but South African Mint stopped publishing mintage figures in 1996). Gold Krugerrands are known for their unique orange hue, which comes from the alloy comprising the 8.33% of the coin that isn’t pure gold. Gold Krugerrands come in 1/10 oz, 1/4 oz, 1/2 oz, and 1 oz sizes, and feature former President Paul Kruger on the obverse, with the national animal, the springbok, on the reverse.
Gold Britannias contain 1 oz of 99.99% pure gold, and images of Queen Elizabeth II (obverse) and Britannia (reverse). Britannia is the personification of Britain as a nation, depicting a female warrior with a trident, shield, and helmet. Unlike Krugerrands and maple leaf coins, Britannias regularly change their designs on the reverse, adding a collectability factor to these gold bullion coins.
Buying gold coins is easiest and most affordable online with trusted dealers like BullionMax. Alternatively, you can buy gold coins in a coin shop, at a pawnshop, or from private sellers or auction sites such as eBay.
If you plan on investing your gold coins in an IRA, consider the IRS rules and regulations for which gold coins meet the eligibility requirements. If you don’t plan on investing your gold coins in an IRA, you should make arrangements for the safe storage of your gold coins, either in a precious metals depository, bank vault, or at home in a secure safe. Finally, before you make your purchase of gold coins, verify that the seller is reputable and that the coins you’re buying come with their original Assay packaging to ensure authenticity and condition.
You can begin right now by visiting BullionMax and exploring our collection of available gold coins.