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The First Rule of Gold & Silver Investing – Don’t Talk About Details

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The First Rule of Gold & Silver Investing – Don’t Talk About Details

 

Some of you may be familiar with the movie “Fight Club.” Tyler Durden, played by Brad Pitt famously shared these words before the start of these weekly illegal fights. “This first rule of fight club is you don’t talk about fight club.” That also happened to be the second rule of fight club. The movie must have made an impact on the founder of Zerohedge.com, as he goes by the name Tyler Durden.

While we’re not talking about illegal fighting in the basement of a bar, we are talking about something that requires a certain amount of privacy, which is investing in gold and silver. While it’s important to share with others the importance of investing in gold and silver, including the many benefits of doing so, we suggest that you refrain from sharing the details of your investment(s).

Case in point, we received a phone call this past week from one of our long-time customers. Without giving away too many details, he recently shared with an individual the importance of protecting her wealth by investing in precious metals and the next thing he knows, his apartment was broken into. While this may be merely a coincidence, the fact is that he had substantial holdings at his place that could have been stolen.

In light of the above story, we thought we’d share with you three rules to follow when sharing about precious metals, so you don’t find yourself a victim in the future.agcb fight club

 

Rule #1 – Don’t Provide Details on Your Gold & Silver Holdings

Share as much as you would like on the importance of investing in gold and silver, how they’re real money, have been used as money for thousands of years, how inflation has eroded the value of the dollar and how much the dollar has been devalued since the creation of the Federal Reserve in 1913, but we recommend that you refrain from providing details on your specific gold and silver holdings.

While the person you’re speaking with may be trustworthy, they may share some of the information that you’ve provided with others, and it may come out that they originally heard this information from you. The more people that know you have precious metals, and the more details they have, the greater chance you have of becoming a victim.

I believe the best course of action is to educate others on precious metals and to leave the details to coin and bullion experts, such as Atlanta Gold & Coin Buyers, to discuss the various options to arrive at an allocation that makes sense for that individual.

This means that the individual you’re sharing information with doesn’t necessarily need to know if you have gold eagles, silver eagles, 90% silver coins, silver bars, rounds, etc. There are many resources available online that you can refer folks to based on their needs and concerns.

For example, they may want the least expensive options available, the most recognizable coins, strictly government-issued or coins and bullion that would work best for bartering. In fact, we’ve previously addressed all these issues in our prior writings.

Rule #2 – Don’t Share How Much You Have Invested in Gold & Silver

One of the most common questions we receive, and one that you’ll likely receive when you begin talking to others about investing in gold and silver is how much a person should invest in precious metals. This will inevitably lead to the individual asking how much you personally have invested in gold and silver.

We all want to be helpful as individuals begin exploring this new investment opportunity, but we suggest that you refrain from sharing how much you personally have invested in gold and silver. This is the case even if you have your items stored in a private vault outside of your residence, as this could still put a target on your back; especially if we see a severe recession in 2024 and people become desperate.

It’s probably a good idea to not share with others too much about yourempty wallet gold silver fight club personal investments anyway. You’ll be the first person people go to when they’re in need of money and will be resentful if you don’t give them money or offer them a loan during their time of need. Needless to say, during the next recession, there will be a number of people that will face hard times, including many individuals that you personally know and may care for.

Rather than provide details as to the amount you personally have invested in gold and silver, we suggest sharing some general guidelines to assist them.

For example, most financial advisors or wealth managers recommend a 5% – 10% allocation in precious metals for diversification purposes, as precious metals tend to have a low correlation to most traditional investments such as stocks, bonds and real estate. This allocation can help to reduce the volatility of a portfolio and increase your overall returns.

Keep in mind that most financial advisors aren’t necessarily incentivized to recommend gold and silver, as this reduces their assets under management (AUM) and overall fees. They’ll likely suggest investing in an ETF or mutual fund rather than physical gold and silver so that they don’t reduce their fees.

There’s an inherent conflict of interest in this field, and only those financial advisors that truly care about the financial future of their clients suggest investing in physical gold and silver. If not for the personal hit that wealth managers take when they recommend precious metals, their suggested allocation may be much higher.

As far as what percentage of each to invest in, that’s more dependent on the individual. For example, the general rule of thumb is a 70% – 80% allocation to gold and a 20% – 30% allocation to silver. The reason for this recommendation is that the price of gold is more stable than silver. While both gold and silver are seen as a store of value and for wealth preservation, the volatility of silver may scare folks into making emotional buying or selling decisions, which almost always happen at the wrong time.

On the other hand, some people look at the gold to silver ratio, which at the time of this writing is roughly 85 to 1. Historically, it’s been more in the 50 or 60 to 1 ratio, which means that silver may be a better buy presently relative to gold. Other folks look at the current price relative to its all-time high. Gold is knocking on the door of its all time high, while silver is still less than half the previous highs set in 1980 and 2011.

gold to silver ratio as of Feb 20 2024
as of February 20, 2024

This is all great information to share with someone without revealing your personal holdings.

Rule #3 – Don’t Share Where You Have Your Gold & Silver Stored

Probably the most obvious of our three rules is the third rule, which is don’t provide specifics as to where your gold and silver is stored. Over the years, we’ve heard many interesting stories as to where people store their physical gold and silver. In a sense, we’re much like a lawyer in that all our conversations are privileged, but not everyone views their conversations the same way.

We’ve previously written articles about some of the most common places people store their precious metals in hopes that this will help you to weigh the pros and cons of each. This may be a good article to share with others rather than giving specifics as to where you store yours.hidden stashes1

Unfortunately, we’ve heard time and time again of people being robbed or burglarized and the criminals knowing exactly where the valuables are stored. Some people love sharing details of what they have, the amount and where it’s stored, which has come back to eventually bite them. Again, this doesn’t mean that the person you share this information with has bad intentions, but people talk, and it’s likely they’ll share some of your information with others not because they have any ill intent, but simply because they found your discussion interesting.

Just keep in mind that the question of where you store your valuables will ultimately come up when you broach the subject of investing in gold and silver, so we suggest that you have a prepared answer so that you don’t get caught off guard and reveal any details that you’ll eventually regret. A good response may be that your gold and silver coins and bars are stored off-site at a secure location and leave it at that.

While this response may not provide them with the answer they’re looking for, it will help to insulate you against potentially becoming a victim in the future.

Summary

In conclusion, it’s best to be somewhat vague with the details when you share with others the importance of investing in physical gold and silver. After all, everyone is different, and your reason for investing in precious metals, or the amount you choose to allocate to this asset class, will inevitably be different than the person you’re speaking with.

In particular, we recommend not sharing the specific items that you’ve invested in or the amount you have allocated toward precious metals, unless the person you’re speaking with can be fully trusted and can keep the discussion in the “vault” so to speak. Not only do you put yourself at risk when providing this information, but this also makes you the most likely person people come to when they are in need of financial assistance.

While the above rules are important, the most important rule is to only share the location of your precious metals with your most trusted friends and family. Obviously, someone needs to be made aware of where your holdings are in the event something unexpectedly happens to you, but short of that, refer folks to our previous article or suggest that they do an online search for some of the most common places to store precious metals.

We hope that today’s article will help to shed some light on how to share precious metals investing with others, including what and what not to share. Whether you’re in the market to add to your personal holdings or want to help a friend or family member get started, Atlanta Gold & Coin Buyers should be your coin dealer of choice. Reach out to us today to see how we differ from the competition and let us help put you on the right investment path in this exciting field.atlanta gold and coin hqr

Picture of Tony Davis
Tony Davis
Tony Davis is the owner of Atlanta Gold & Coin Buyers, a full service Atlanta based coin and bullion dealer specializing in buying, selling and appraising coins and coin collections of all types and sizes. Tony frequently writes on various economic and numismatic related topics affecting the coin and bullion markets and has been published on some of the industry’s leading websites, including Coin Week, the American Numismatic Association, Coin Collector, Coinflation, and Coin Auctions Help, just to name a few. Visit Atlanta Gold & Coin’s website at atlantagoldandcoin.com to obtain additional information on the products, services and educational resources offered by his company. Tony can be reached at sales@atlantagoldandcoin.com or at 404-236-9744

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