Five Strategies For Buying Gold Bars and Gold Bullion Coins

1. Shop around for gold bullion sellers. Ideally, you will want to choose a seller asking the lowest premium (shipping, handling, tax, insurance, and margin over spot price) on your bullion coin or bar purchase. Prices vary widely among sellers, so your best bet is to compare ahead of time and choose one before you call in on a spot price.

Some dealers collect considerably less margin than others; during periods of adequate supply gold bullion coins typically sell at a 5 to 20 percent premium while gold bars sell with a 2 and 5 percent premium. Those premiums rise when gold is in short supply. Buying bullion gold coins or bars at higher volumes can also drive the premium price down, so consider buying larger amounts to capitalize on premium discounts.

Be sure the dealer has the gold in inventory and that you do not have to wait for the dealer to acquire the gold.

2. Build up a variety of gold bullion . In today's volatile economy, it's difficult to determine what currencies will be worth in a year, even five years from now. Most disaster preparation experts advise to keep three to six months of savings on-hand in case of a prolonged emergency. What about a financial collapse? What if your currency is deemed worthless?

Choosing a variety of gold types may be an effective form of preparation. Gold bullion coins such as Krugerrands and Gold Eagles are easily recognized for their gold value and can be exchanged all over the world. They are transportable and are easy to hide. Fractional Krugerrands and Eagles will be valuable in the daily exchange for goods and services. Although not as easy to exchange, gold bars can be hidden away discretely and saved for generations.

3. Keep away from collector's coins. Although heralded worldwide for their beauty and value, collector's coins are not a wise choice for the investment-minded individual. Collector coin prices tend to fluctuate widely based on age, amount of gold, and grade. They are not as tradable as circulated gold bullion coins, nor is their worth easily determined. Some collector's coins come from privately owned corporations rather than from the government, so the purity may be lower and without a guarantee.

4. Consider storage options. You may be tempted to purchase ETF's (Exchange Traded Funds) or have an entity hold your gold in escrow. These are options if you wish to deal with an increasing amount of investment risk. (Research what happened to ETF's in September 2008 when AIG faltered.)

However, you should re-think why you are purchasing gold in the first place; it is likely for asset protection during uncertain economic times. Wouldn't it make more sense to hold some tangible assets in your own domicile under your direct control? Look into a safe or vault purchase if you are concerned about safety and privacy.

5. Invest regularly and look long-term. Instead of making a large-sum, one-time purchase, consider an investment plan for acquiring more gold bullion coins and bars over time. By using simple cost-averaging techniques, you will spread expenses out evenly over time. Don't be discouraged if you see a cycle where spot prices drop dramatically. Over time, gold prices have always recovered from their lows.

Latest predictions say that gold may rise to over $2,000 per ounce in the near future as demand from China and India begin to strain supply. The worldwide economic downturn is also delaying gold mining research and development, further complicating the supply chain.