How to Sell a Gold Coin – An Insider’s Guide
By Paul Vanguard, for BullionMax.com
Physical gold is easy to sell. That much we know. If you're talking gold coins, all the better. Gold coins generally are much easier to recognize (and much harder to counterfeit) than gold bullion bars. Lots of places will buy them. I’ve said it before and I’ll say it again: No one doesn’t want a gold coin.
Now, getting paid a fair price when you sell your gold coin, that’s a different matter entirely. So today I’m going to walk you through how to sell a gold coin, step by step, to give you the best shot at a fair price.
First things first: individual sellers of gold coins or bullion bars will fare much better than those selling gold jewelry. For all the hefty price gold jewelry commands at retail, its value is far less about its gold content and much more about craftsmanship. Jewelry buyers tend to disregard the craftsmanship part and focus only on the gold content, leaving you disappointed with a quote far below the retail price you paid.
By comparison, gold bullion coins are valued and sold by their precious metal content first and foremost. So the difference between retail price and their resale price isn't nearly as heartbreaking, if you do it right.
Not everything is smooth when you sell a gold coin either, though. You're probably hoping to sell at the price you bought them for at least, and that makes sense. Here’s the issue from a buyer’s perspective: premiums over the gold’s price are involved in every retail sale, along with the markups we charge to make a profit. That means you probably won't be able to sell your gold coins to a dealer or reseller at retail price.
You might not care too much, if you’re trying to learn how to sell a gold coin because, say, you inherited one from your drunk old Uncle George. In the case where your cost basis (your initial investment, or how much you paid for the coin) is $0, you’re happy to get paid more than $0 for your coin. You never really liked Uncle George anyway. Even in the case where your cost basis is $0, there are a few things you can do to maximize your payout.
Sell a gold coin online
Let's get the pitch out of the way first – we buy gold coins and bars all day every day. We don’t buy just everything, though. Along with gold content, the condition of your coin is a crucial factor.
If you have a gold coin in perfect (in other words, resellable to BullionMax customer without making them cranky) condition, we'll probably offer 80%-95% of the current retail price. There’s a lot of wiggle room in that number, because we’re buying to resell. Our offer is influenced by the gold coin’s popularity much more than its rarity. Remember, we don’t buy gold coins because we love them (although we do love them), we buy them to resell them.
Real-life example: I recently helped a friend sell 2 American eagle 1 oz gold bullion coins to BullionMax – they were in just-like-new condition, and she got paid spot + $35. She was overjoyed because the were, in fact, a legacy from her drunk old Uncle George. Luckily for her, we sell a ton of 1 oz gold eagles – they’re always in demand. In fact, I think we sold those two later the same day. Despite his battles with the demon rum, Uncle George did a good job of keeping those two eagles pristine. For all those reasons, she got a great price.
In cases like this one, you've gotten a good deal, because you've essentially sold the gold coin for its spot price plus or minus a bit. Retail premiums on gold coins go from 5-6% as high as 50% for the smallest fractional gold coins. So, being able to sell your gold coin at spot price can be dandy, depending on your circumstances.
Other online bullion dealers also buy gold coins. Maybe they’ll make you an offer on your scratch-and-dent Krugerrand? They’ll likely offer 10-15% less than they would for a like-new coin, because then they have to sell it as a separate, discounted item, with a note of blemish. (Think of it as selling someone a used item. They won't buy it for the full price, right?) This is why proper storage of coins is important even though gold itself doesn't tarnish. By the way that’s also a good reason why 22kt gold coins (eagles and Krugerrands) are generally more resellable than the buttery-soft, pure 24kt buffalos and maple leafs.
It goes without saying that you shouldn't ship your gold on good faith unless dealing with an established retailer. Preferably someone you trust, maybe, someone whose very helpful advice you’re reading right now?
How to sell a gold coin offline
Of course, you might not always be able to sell to us, which is where things get a little more tricky. Here are some general rules…
Get your gold coin appraised and graded by a certified professional. You could have a standard-issue gold buffalo, or you could have a collector's item that's worth a whole lot more than spot price. Now, you’ll only be able to capture that additional value if you sell to someone who actually recognizes it!
Pawn shops will lowball you. Sometimes, they’ll offer 20% of your coin’s value, hoping you’re either stupid or desperate enough to accept. Should you stand your ground and haggle, you could get as much as 45% of the coin’s value. Don’t go to a pawn shop to sell your gold coin, no matter how much you hated Uncle George!
Coin dealers are preferable. Experts like Gary Smith, past international president of the American Society of Appraisers, advised that gold coins are generally sold between 65%-88% of their value.
Whether selling online or face-to-face, try to sell to someone who can just chuck it in their inventory and resell it. That’s a major reason coin dealers are preferable. Should you go to your favorite jeweler and try to sell your gold Britannia, well, your jeweler can’t use it as-is. To turn your beautiful coin into raw material, the jeweler will need to melt it. And that’s a hassle. People don’t like hassles! So they’ll offer you a lower price. (Whatever you do, don’t try to sell your gold coins to your dentist. Trust me on this.)
Coin shows are a good place to collect multiple offers for your coin in a single afternoon, if you’re willing to track one down.
And of course there’s always eBay, America’s attic. You could list your coin and maybe get paid a fair price, and even maybe collect the money, too – but I’m out of time today and I don’t want to tell you how many of my friends have fallen for eBay scams.
Maybe you should not sell your gold coin?
Okay, look, it’s worth mentioning: consider keeping your gold coin? It could become a family heirloom. Stick it in your bugout bag so you’ll have it handy when SHTF. Personally, I’m biased, but I believe every American should have at least one gold coin. Just in case.
Paul Vanguard is a lifelong precious metals enthusiast and a proud member of the BullionMax team.