Storing PMs

[moonshot]

This pertains to keeping some of a US resident/citizen's non-retirement assets in physical PMs (as opposed to ETFs, etc.).

I'm trying to think through the pros and cons of holding physical PMs either domestically or abroad (via Gold Money or Bullion Vault).

With gold held abroad at the aforementioned firms, you have the annual filings - FBAR (Form 90-22.1) and FACTA (Form 8938), as well as all the risks involved with someone else holding your PMs in another country:
1. risk the PMs aren't authentic
2. risk the custodian absconds with PMs
3. risk that when you really need the PMs (SHTF), the country in which the PMs are held seizes all PMs in its jurisdiction
4. risk that you may not be able to make it abroad in a SHTF scenario to collect your PMs

3 and 4 might be mitigated if you are able to get abroad and collect your PMs before border crossings are restricted or foreign country confiscation takes place.

With physical held domestically, seems the options are having it held by an institution (safety deposit box) or holding it yourself. The biggest risks here seem to be:
1. you buy fake PMs
2. PMs you hold yourself are stolen
3. national confiscation

Are there other factors I should be considering when trying to decide between holding PMs domestically or abroad?

[doom&gloom]

Re: Storing PMs domestically or abroad

you know you can buy the stuff and bury it somewhere and have less concerns overall. For example, if you boat up the coast of Canada, there are plenty of places you could pull over, bury the stuff, keep some lat/log coordinates, and no one will ever find the stuff.

[moonshot]

Re: Storing PMs domestically or abroad

For example, if you boat up the coast of Canada, there are plenty of places you could pull over, bury the stuff, keep some lat/log coordinates, and no one will ever find the stuff.

And when you come back, there's a resort built on top of your buried treasure!

[shiny!]

Re: Storing PMs domestically or abroad

I think the concern about buying fake PMs is way overblown. ZeroHedge would have you believe that every coin out there is a coated tungsten slab. Tungsten fakes are hard to detect, but tungsten is very hard to work with, especially for coins because of the high level of detail. My hunch is that tungsten fakes are more problematic in investment grade bars, not small coins.

Fake coins are usually made with lead and other malleable metals and are easy to spot. They look crude. They're either over large if they're the correct weight, or under weight if they're the correct size. Buy a scale and calipers. Search the internet for tables of weights and dimensions of bullion coins. Measure and weigh various coins and look at them closely until you feel familiar with them. Or buy some Fisch fake coin detectors.

Or buy sealed boxes of Silver Eagles or Maples, or sealed tubes of Golden Eagles or Maples directly from the mint, or from a reputable dealer who gets them from the mint.

Hang out in coin shops and cultivate a relationship with a reputable local coin dealer. He'll have screened his coins before putting them up for sale. Coin shop owners are usually somewhat reserved until they get to know you. Go in frequently and make small purchases just to establish yourself as a regular customer. Be friendly. Ask questions when they aren't too busy. Tell them you're trying to build up a stock of PMs and are frankly worried about getting fakes. If the dealer is decent, he'll show you what to look for. He might even show you his fake collection that he acquired over the years.

How to Spot Fake Bullion Coins

Don't over think this. IMHO the risk of letting fear prevent you from having any PMs is worse than the risk of getting a fake or that you might lose them to confiscation or taxes down the road. Just use some common sense and take things one step at a time, but start walking...

[aaron]

Re: Storing PMs domestically or abroad

I agree. The risk is way overblown. Selling fake gold coins would put a shop out of business quick.

[Ellen Z]

Re: Storing PMs domestically or abroad

This pertains to keeping some of a US resident/citizen's non-retirement assets in physical PMs (as opposed to ETFs, etc.).

Are there other factors I should be considering when trying to decide between holding PMs domestically or abroad?

Personally, I'm a belt-and-suspenders kind of person. I think there's a sense of security in using more than one of those methods... don't waste brain space trying to decide which method is best... use two or three methods, and figure that likely if one goes sour for some reason, another one will work out smoothly.

Also, you might want to think a bit about your goals. If your goal is to hold on to all your assets, every bit ... well, that might be more difficult. My goal is to position myself so that I have some assets remaining after any curve balls that the next years throw at us... to have some resiliency ... I don't expect to bat 1000.

I'm trying to think through the pros and cons of holding physical PMs either domestically or abroad (via Gold Money or Bullion Vault).

With gold held abroad at the aforementioned firms, you have the annual filings - FBAR (Form 90-22.1) and FACTA (Form 8938), as well as all the risks involved with someone else holding your PMs in another country:
1. risk the PMs aren't authentic
2. risk the custodian absconds with PMs
3. risk that when you really need the PMs (SHTF), the country in which the PMs are held seizes all PMs in its jurisdiction
4. risk that you may not be able to make it abroad in a SHTF scenario to collect your PMs

I've thought about BV, and hope to open an account with them within the next year. Re: 1) and 2) ... enough people on this site have praised BV, that I don't worry about 1) and 2).
Re: 3) ... BV has a storage vault in Switzerland.
Re: 4) My impression is that as things work now, Bullion Vault will send you the current dollar value of your holdings at any time, via electronic means.

You don't list an internet collapse on your summary of potential problems... that would be the situation where assets held in BV would be vulnerable, and assets held locally would be more secure.

I think all any of us can do is invest a reasonable percentage of time/attention/study into these issues, do the best we can, and then shrug. The ability to shrug off problems, and regroup yourself to cope with whatever is happening next, will be an important asset for hard times ahead, just as important as finding a way to store assets.

[shiny!]

Re: Storing PMs domestically or abroad

The ability to shrug off problems, and regroup yourself to cope with whatever is happening next, will be an important asset for hard times ahead, just as important as finding a way to store assets.

This is one of the best pieces of advice I've ever read.