Once every trip around the sun, everyone’s hopes spring eternal with the advent of a new year. Even considering ongoing global conflicts, continued soaring prices and employment/salary uncertainties, optimism for a renaissance in 2026 remains. None of this is new. Every year brings its share of positives and negatives. There is one present-day exception – a major yet quiet difference few have glommed onto – gold. More precisely, gold and silver.
Those precious metals have stealthily crept up to new records stratospheric enough to fully eclipse the gold and silver rush of 1980. Still, they are under the conventional radar....
Consider that, 45 years ago, when gold reached a 1980 peak of $850 per ounce and silver climbed past $50, the prices made daily headlines. Pundits predicted gold to soon teeter on $3,000. It’s taken over four decades but that “soon” finally came and was far passed. As of last week, gold set a new record of $4,377. Simultaneously, silver hit $67 per ounce. They may be even higher now.
The result has been the public selling silver flatware and serving pieces en masse to coin and bullion dealers. Metals dealers report people being tired of constantly polishing tarnished silver. That, and today’s record metals prices are seeing barrels of the vintage possessions melted daily. So much silver is being turned in refiners are said to be overwhelmed and unable to handle the load. Most are so swamped, prices they offer are often even lower than what they might normally pay.
But, what of the flip side? Just as stock speculators continue to pour money into the potentially overbought AI/technology and financial sectors, other investors are ignoring high metals prices and continuing to buy. They will may be right. But, there are other consequences.
First, consider that, as recently as six years ago, gold was barely $1,200 per ounce. So, ten one-ounce gold coins would have cost around $12,000. At today’s prices, those same ten coins are teetering on $44,000. It’s similar with silver. In 2020, a one-ounce silver bar or round cost under $15 and a 100-ounce bar was priced at $1,500. Now, a 100-ounce bar is well over $6,600.
There’s more. Depending on the state in which one lives, there’s another significant consideration – taxes. Of course, when selling, if there’s a profit, capital gains may take a bite. Those payments are up to each individual to admit and pay. But, when purchasing, what of sales taxes? Even though there are no taxes charged when buying stocks or bonds, in multiple states, a sales tax is charged on purchases of numismatic coins or bullion.
Precious metals or coins should surely be considered an investment. But, those taxes can significantly eat into profits. Sometimes, combined state and local taxes can even exceed 10 percent.
In that case, the purchase of just two one-ounce gold coins for around $9,000 could result in a tax of $800 or $900. The result is significant. Such a sales tax on ten ounces of gold could be upwards of $4,500 – about enough to acquire an additional Eagle, Maple Leaf or Krugerrand.
Now, consider if a nearby or adjoining state doesn’t charge a sales tax on gold or silver coins or bullion. Who in their right mind wouldn’t opt to buy there? Case in point, this past July, Connecticut eliminated their sales tax on precious metals. However, neighboring Massachusetts still charges over six percent. It’s a mere 30-minute drive from Springfield to Hartford. The numbers speak for themselves.
There’s another matter concerning where you buy. The US Mint has an impressive website with scads of colorful pictures and compelling sales copy. The catch is, most all the gold coins they are selling are special collector strikes replete with Certificates of Authenticity and handsome presentation boxes. For those, buyers can expect to pay a hefty premium.
Alternately, for anyone looking strictly to invest in the metals, the Mint makes “circulation” strikes of both gold and silver Eagle coins. These have the same designs and are delivered in impressive uncirculated condition. They just are not the highly polished “proof” variety nor do they have superfluous certificates or pretty boxes. Nevertheless, the metal they contain is every bit as valuable.
The Mint doesn’t sell those coins directly to the public but, rather, to dealer distributors. That’s where they need to be obtained. For optimistic investors looking to add silver or gold coins to their portfolio, a local or trusted online dealer can be your best resource for the New Year.
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