Wealth Preservation: Understanding Silver and Gold Content for Collapse Investing

Investing in precious metals is a great way to diversify and preserve your wealth. You can even find it on eBay! While this article is by no means an exhaustive treatise on gold and silver buying, it is more of a “primer” to give you some basic information you need to get started (if you plan on going into this area) or to provide knowledge to arm you in your dealings with people.  Some of this may be useful for you in purchases of precious metals, but the scope of this is mainly to cover things that you may find when out hunting in the flea markets, thrift stores, yard sales, or other areas of the “secondary shops.”

First, we’ll cover gold measured in terms of purity that is expressed in karats, symbolized by the letter “K” and “kt” with jewelers.

24 Karat                                 100%, or pure gold

22 Karat                                 91.7% gold

18 Karat                                 75.0% gold

14 Karat                                 58.3% gold

10 Karat                                 41.7% gold

Now let’s cover silver, a metal marked with a purity mark.  Here are the marks and their percentage of silver contents that correspond:

999                                          99.9% silver

958                                          95.8% silver

925                                          92.5% silver (known as Sterling silver)     

800                                          80.0% silver

We are referring mostly to jewelry or decorative pieces and keepsakes here (such as silverware, candlestick holders, or other things that may bear a stamp to show their precious metal content).  Coins are a little bit more involved and beyond the scope of this article, as there are too many to list here.

One of the problems that people run into with jewelry and their great-grandmother’s candlestick holders is that most businesses that buy them will usually pay according to their melt value.  This is especially true with silver.  Most of these dealers will estimate the silver content of your item by weight, and then will pay you roughly 15-25% under value to cover their handling and melting charges.

Learn how to test your junk gold and silver

For coins there can be a numismatic value attached to the coin…that is, its worth as a collector piece…that is greater than the melt value.  There is also the little problem that although the coins are no longer in circulation, well…they are.  All coins and currency are (technically) the property of the U.S. government…and to melt them down without proper authorization would be considered destruction of government property.

Jewelry doesn’t have that problem.  The real problem is that you will receive a fraction of what it is worth when you take it to a dealer who will hand you nice, crisp, approved, Federal Reserve Notes in exchange for your silver or gold.  Here’s how to figure out the “melt value” in silver:

Take your weight in silver (usually in grams) and convert to troy ounces, multiplying this weight by the percentage of silver in the silver content of your item.  Then you will have the amount of silver in troy ounces.  Then it’s a simple matter to look up the spot price of the silver (what silver is trading for that day on the commodities exchanges).  Divide the weight of your silver by the spot price to find out the worth in dollars.  Then multiplythis figure by the percentage that the dealer will pay you minus his handling and melting fees.

Now, many people do this routinely as a business.  Others hold onto their finds.  Your actions will be determined by your purpose: to turn a “quick” Federal Reserve note out of some metals, or to garner a supply little by little as a hedge against either a currency collapse, or as a barter material in a future time.  Either way, this piece will get you started on researching an area you may choose to enter or specialize within.  Good luck and remember to lay your groundwork before you act.  JJ out!

Additional Reading:

• 6 Multi-Purpose Preps You Need in Your Emergency Supplies 
• Cash After the Collapse: Maximizing Your Bartering Potential
• Bartering in a Post-Collapse Society
• Here’s the Key to Urban Prepping That Most…
• The State of the Economy and Why You Need to Be Preparing

Jeremiah Johnson is the Nom de plume of a retired Green Beret of the United States Army Special Forces (Airborne). Mr. Johnson was a Special Forces Medic, EMT and ACLS-certified, with comprehensive training in wilderness survival, rescue, and patient-extraction. He is a Certified Master Herbalist and a graduate of the Global College of Natural Medicine of Santa Ana, CA. A graduate of the U.S. Army’s survival course of SERE school (Survival Evasion Resistance Escape), Mr. Johnson also successfully completed the Montana Master Food Preserver Course for home-canning, smoking, and dehydrating foods.

Mr. Johnson dries and tinctures a wide variety of medicinal herbs taken by wild crafting and cultivation, in addition to preserving and canning his own food. An expert in land navigation, survival, mountaineering, and parachuting as trained by the United States Army, Mr. Johnson is an ardent advocate for preparedness, self-sufficiency, and long-term disaster sustainability for families. He and his wife survived Hurricane Katrina and its aftermath. Cross-trained as a Special Forces Engineer, he is an expert in supply, logistics, transport, and long-term storage of perishable materials, having incorporated many of these techniques plus some unique innovations in his own homestead.

Mr. Johnson brings practical, tested experience firmly rooted in formal education to his writings and to our team. He and his wife live in a cabin in the mountains of Western Montana with their three cats.