Although gold and silver have both exploded in popularity in recent years, only a small fraction of the U.S. population invests in physical metals.
So we’ve decided to try something new on the Provident Metals blog: customer stories.
Our goal for this exciting new series?
To answer questions and ease any concerns of those less familiar with precious metals , while highlighting the experiences of valued investors, who are everyday people saving for their futures.
Here is one of their stories. Florida resident Nate has been a loyal Provident Metals customer since 2010. His story highlights a common problem often encountered by novice investors.
A Cautionary Tale: Nate, Five-Year Precious Metals Investor
I first got interested in gold and silver back in 2008 when it seemed the financial system was on the verge of collapse.
My financial situation was pretty bleak. Like many Americans, I had overspent and taken on too much credit. By the middle of that year, my balances were close to exceeding my total annual salary.
Suffice it to say I was hanging on by a thread. I was faced with the prospect of bankruptcy and entered a credit counseling program sometime around the end of the year.
My first metals purchase was sometime in the middle of that year. I purchased several Peace Silver Dollars using funds from a tax refund. My next purchase was around a year later when I bought some British Sovereign coins.
This initial foray into metals investing was a brutal lesson. The dealer, who I won’t name, convinced me that I should buy collectors’ coins like the Sovereign to avoid seizure by the government. Provident Metals has some great resources on this gold confiscation myth.
Needless to say, I was pretty upset when I found out this is a myth used by shady dealers to get people to spend more on coins they’re not really interested in. My purposes were investing, not collecting. Yes, there was a confiscation back in the 1930s, but the likelihood of it occurring again is pretty low considering U.S. currency is no longer tied to gold in any way.
Anyway, following this, I discovered 90% junk silver quarters, dimes and nickels.
Again, my main purpose was investing and saving for a rainy day. As I was working through my credit issues, I wanted to better understand the underlying (external) reasons for my indebtedness. This is when I started realizing the basis of our economy, and how it relies so much on debt.
While I take personal and full responsibility for my credit issues, it was easy to see how super-low interest rates could entice someone to get in the hole.
This understanding also led me to conclude that if one person can get in that bad, just think about the impact when you start thinking about entire countries.
As we know from reading stories at Provident and elsewhere, sovereign debt issues plague many countries in the world, including the United States. The Fed, EU and other central banks have printed untold amounts of money to prop up their fragile economies.
Without the means to relocate to another country, it became apparent that a good way to shield myself from potential calamity was to own more physical gold and silver. I particularly like 90% junk quarters since they serve two purposes: one is investment of course, and the other reason is barter if the need arises.
Last but not least, buying silver and copper coins (I can rarely afford gold) has given me a sense of independence. One of the reasons my credit situation got so bad was because of a lack of savings. It can be very hard to save cash for a rainy day.
Silver coins on the other hand are easier to save — it’s harder to go spend them (right away that is), and you can be assured they will maintain and grow their value over time.
I think if more people understood silver in this respect, more would be interested.
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Were to begin? When I was a teenager I worked in a mall. One of the places I loved to visit most was a shop called Silver Eagle Collectables. I would visit on lunch breaks, days off , and anytime I had a chance. I started buying some 1 oz. silver bars and some coins. I never would call myself an investor or collector I just thought it was exciting.
As the years went buy my little collection seemed to get lost or given away as gifts. After that life just got to busy and hectic and collecting anything never happened. I always seemed to have a hole in my life that I could never fill. During the 1990’s and early 2000’s I would be intrigued with coins and metals but never took the step towards collecting or investing.
In 2005 my wife and I found out we had a baby on the way. As all of you know the new addition of a child to any family is a big step and a costly one.
When my son was just 6 weeks old he was hospitalized with a severe infection of the lungs. He life was in the balance and days and nights just went by. We dodged that bullet and thought we were just going to get back on track with our family. At 10 months old he started having seizures and life got hectic again. a month later his seizures got so bad his Neurologist prescribed a medication to stop the seizures. Exactly 1 hour and 30 minutes after he took the medication he had a Grand Maul seizure stopped breathing and was knocking on deaths door. After a 6 week hospital stay which was in a hospital about 400 miles from our home we finally got his health under control.
What does all this have to do with coins and investing in metals. During the six weeks away from home, in my change paying for food and such I got several silver coins and wheat pennies. I keep those and told myself these will be for my son. During all this I lost my job and my health started to fail. One thing I was determined to do was build a collection of coins and metals for my son so that if anything should happen to me he had something that had value.
I started off really slow buying bars of pure copper, since it was an inexpensive metal to invest in. I bought all my copper from Provident Metals and began to trust them for quality and value. I started to research coins, and coins made with precious metals. I am the type of person that will spend countless hours researching so I can make the most of out whatever I have. I was never able to afford gold, but silver the poor man’s metal was just right. From American Silver Eagles, to coins minted in silver I started buying as much as I could afford. I also started collecting American coins of any sort and have built my son a massive collection of over 100 oz’s of silver, and over 20,000 American coins. The oldest coin in his collection is from 1783, the newest is 2013 (waiting on the 2014’s to come out). My interest in coins and precious metals all started by my son almost dying. So remember it is never to late to start. All it takes is one coin, or one piece of silver. So take that step, buy a piece of silver there is something magical about the way silver feels, I am sure it is the same or even better with gold. Start, be it a small invest at first like I have done, or investing larger amounts. The draw and allure of precious metals will fill that investing hole. Coins are magical they teach our children so many things. Things like what life was like during a completely different period of time. As we learn, we can teach, as we teach we inspire. Take the step and inspire a child. You will be better for it.
Wow Scott, thank you for sharing your story!
Nate lists several valid reasons why precious metal should be considered by all investors. I started investing in silver around 1978, did well and then ran into financial difficulties when interest rates went up over 20%. When I got back on my feet I went into stocks. I soon found out that no one was really interested in working with me unless I had at least $150,000. to invest an they were seldom interested in buying and selling what I was interested in; not my cup of tea.
When I decided to go back to silver I researched many vendors and decided to start with Provident; a wise choice. I am able to buy 90% coins, silver rounds, Eagles, etc. without having to hock the farm to do it. It’s very simple. When I like the spot or the trend I buy. I have not sold any mostly because I just like silver. I may sell some if the spot goes up enough, but silver will not go bankrupt, no one at Provident tries to churn me and, like all precious metals, it will not rot. If I leave it to my kids they know who to call for advice. All in all this is a pretty good deal.
Thanks for being our customer, Bill! We appreciate your loyalty. Thanks for sharing.