How to buy silver: coins, rounds and bars

1. Pick a form

• Government coins. The American Silver Eagle is made by the U.S. Mint. It holds one troy ounce of 99.9% pure silver and has a $1 face value. The Canadian Silver Maple Leaf is a similar one-ounce coin. They cost more over spot than rounds, and are easy to sell.
• Rounds and bars. A 1 oz round is a private-mint coin-shaped piece with no face value. Bars come as 1 oz, 10 oz, 100 oz and 1 kilo. Larger sizes usually cost less per ounce.
• Old US silver coins. Dimes, quarters and half dollars dated 1964 or earlier are 90% silver. They are sold in bags by face value and priced from their silver content: see junk silver explained and the junk silver calculator. Check that a coin is real first: how to tell if a coin is silver.
• Sterling and flatware. Sterling is 92.5% silver. It is usually bought for the object, not as metal. Dealers pay only a share of the silver value when you sell: scrap silver calculator.

2. Know the price

Silver trades at a spot price per troy ounce: $52.27 today. A dealer adds a premium on top. For 1 oz pieces, the premium is a larger share of the price than it is for gold. A 10 oz or 100 oz bar spreads the same costs over more silver.

Price = spot price x ounces of silver + premium

The premium over spot calculator turns any dealer price into a percentage. The price per gram and the troy ounce converter help when a dealer quotes in grams or ordinary ounces. A troy ounce is 31.1035 grams.

Silver is also priced against gold. Today one ounce of gold buys about 78 ounces of silver; see the gold/silver ratio. The ratio moves a lot over time and does not tell you what will happen next.

3. Compare dealers

Price the same product from three sellers. Add shipping, insurance and tax, then compare the total. Our compare pages list dealer prices for common items, such as the 1 oz American Silver Eagle, the 1 oz silver round and the 10 oz silver bar. Ask what the dealer would pay to buy the item back. Pay by a method you can trace, use insured shipping, and check the package when it arrives. See how to buy gold for the same steps in more detail.

Space and storage

A thousand dollars of silver is many pieces; a thousand dollars of gold is one small coin. A 1 oz Silver Eagle weighs a little over an ounce, so 100 coins weigh more than 3 kg. Plan storage that is dry and secure, and check insurance. Silver tarnishes; handle coins by the edges and keep them in sealed tubes or capsules. More in how to store coins.

Tax: general information

• Sales tax. Rules vary by state. Some states exempt gold and silver, some only above a minimum purchase, and some charge full tax. Look up your state: sales tax on gold and silver.
• Gains. The IRS counts metals such as silver bullion and coins as collectibles. A long-term gain (held more than one year) is taxed at your rate up to 28%. A gain on silver held one year or less is taxed as ordinary income. Ask a tax professional about your case.

Red flags

• Cold calls, pressure to decide today, or loans to buy metal.
• Common old coins or "rare" sets priced far above their silver content. The FTC says to find the melt value of a coin before you buy: use the melt calculator.
• Prices well below spot. They usually mean a fake or a scam.
• No street address, phone number or written terms.

Want to compare with gold, funds or stocks? Read how to invest in gold. When you are ready to sell, see where to sell gold and silver.

Sources

• U.S. Mint, bullion coin programs: American Silver Eagle specifications.
• IRS, Instructions for Schedule D and Topic 409: collectibles, 28% maximum rate, one-year holding period.
• FTC testimony on coins and precious metal investments.