Investing in Silver: A Beginner's Guide to Precious Metals

Investing in precious metals has increased in popularity, and you may be wondering how to invest in silver. It's far cheaper to invest in than gold, and it's often a good starting place if you're new to precious metals. Until the silver standard was eliminated, the average person in the United States used dimes, quarters and half dollar silver coins. Now those coins are worth many times the face value of the coins, and they are worth adding to your savings. Silver bars are an alternative form of silver investment, but it may not be a good option for your silver investment strategy.

Junk Silver

Junk silver are United States silver coins that were circulated prior to 1965. The silver content of a junk silver coin is 90 percent. There are many dimes and quarters that you can buy, but fewer half dollars, because those were not as heavily circulated. The three types of silver half dollar coins to buy are:

• Ben Franklin half-dollars,
• 1964-dated Kennedy half-dollars,
• Walking Liberty half-dollars.

After you learn how to invest in silver, your first step should be to buy junk silver. For dimes and quarters, most investors buy a bag full, which equals $1,000 the face value. That means that when you add up the dimes and quarters without tacking on today's higher value, called the "spot price", it should be worth $1,000. The bag will be worth more, because silver sells for several times the face value. If you cannot afford to buy a bag full, then you  buy rolls or individual coins. You can buy junk silver from coin dealers, and find deals at estate sales, auctions and some pawn shops.

Silver Eagle

One dollar coins that are United States minted are American Silver Eagles. Each Silver Eagle contains 99.9 percent silver content. These are not to be confused with regular silver dollars, which were minted between 1878-1904 and between 1921-1935. Coin dealers sell Silver Eagles in tubes containing 20 coins, boxes that contains 25 tubes or individually. Each Silver Eagle is worth more than the face value, such as 2 to 4 times more. It's good to own some Silver Eagles in addition to junk silver coins.

Silver Bars

In addition to knowing how to invest in silver, you have to determine why you want to invest. In many cases, investors want to be able to resell the coins or exchange it for goods and services when the dollar may not be worth as much. Silver bars may not be the best investment option. A silver bar is made up of 100 ounces of silver. Each weighs close to seven pounds, and contains 99.9 percent fine silver. Three popular brands of silver bars are:

• Engelhard
• Johnson Matthey
• Sunshine

Silver bars are an investment option, but it may not be the best way to invest in silver as an individual. It's easier to sell coins, and convince others to take silver coins, because the value is on the face of the coin and United States silver coins are recognizable by most people. Those same people are not as familiar with silver bars.