Precious Metals
What do you think of when you think of silver bars? Do you think of large stacks of huge bars sitting in a vault, or of small bars changing hands at a coin shop?
Do you think of banks hoarding tons of precious metals in their safes, or of government minters buying silver to mint coins? While the US government does hold nearly 500 tonnes of silver, and while the government did recently add silver to its list of strategic and critical minerals, silver isn’t just a strategic asset for governments and financial institutions.
Silver can play an important role for individuals in helping protect their financial well-being. If you want to learn more about silver bars, and why owning silver can be so important, keep reading.
There are two primary methods of producing Silver bars: casting and minting.
Cast silver bars, sometimes referred to as poured silver bars, are produced by pouring molten silver into a form or mold. Depending on the size of the mold and how they’re processed after casting, these bars may not weigh exactly the amount they’re supposed to.
For instance, the 1,000-ounce Good Delivery bars that are the backbone of the London silver market don’t have to weigh exactly 400 ounces, they’re allowed to weigh between 900 and 1,100 ounces.
This doesn’t mean, though, that you’ll pay a 1,000-ounce price for a bar that weighs 900 ounces or one that weighs 1,100 ounces. These bars will be measured on delivery and priced according to their actual weight.
Minted silver bars are normally produced from rectangularly-shaped silver blanks of a certain weight, which are then minted in a press in a similar manner to silver coins. The surface finish of these silver bars is normally smoother and shinier than that of cast silver bars.
If you’ve ever tried to buy silver, you probably have noticed that most silver coins are weighed in ounces. More specifically, they’re weighed in troy ounces, not the avoirdupois or “standard” ounces that you’re used to in the grocery store.
An avoirdupois or “standard” pound weighs 7,000 grains, and is divided into 16 ounces, which each weigh 437.5 grains. If you own guns you’ll know grains as a weight, so one standard ounce weighs the same as about 2 .45 ACP bullets or 4 9mm bullets.
A troy ounce, on the other hand, weighs 480 grains, and there are 12 troy ounces to a troy pound, so that the troy pound weighs 5,760 grains. Thus while a troy ounce weighs more than a standard ounce, a troy pound is lighter than a standard pound.
But silver bars aren’t measured just in troy ounces. They can also be measured in grams or kilograms, which are popular measurements in Europe and Asia.
If you remember your metric system from high school, these are the same grams and kilograms that are used in scientific measurement.
Smaller bars are generally weighed in grams. Larger bars are normally weighed in ounces, with the 1,000-ounce bar being the standard for international silver markets.
While the many different units of measurement can make it a little difficult to compare sizes between metric and troy ounce-denominated silver bars, our handy table below can help you make comparisons between different sizes of silver bars.
Like silver coins, silver bars come in a variety of sizes and weights. Here are some common silver bar sizes you may encounter during your search for silver bars to buy.
|
Bar Size |
Grams |
Troy Ounces |
Standard Ounces |
Similar Weight |
| 1 gram | 1 | 0.032 | 0.035 | Paper clip |
| 5 gram | 5 | 0.161 | 0.176 | Modern US nickel (5-cent coin) |
| 10 gram | 10 | 0.322 | 0.353 | AAA alkaline battery |
| 20 gram | 20 | 0.643 | 0.705 | AA alkaline battery |
| 50 gram | 50 | 1.608 | 1.764 | 2 AA batteries |
| 100 gram | 100 | 3.215 | 3.527 | Chocolate bar |
| 250 gram | 250 | 8.038 | 8.819 | Stick of butter |
| 500 gram | 500 | 16.075 | 17.637 | Can of soup |
| 1 kilogram | 1,000 | 32.151 | 35.274 | 2 bags of coffee beans |
| 5 kilogram | 5,000 | 160.75 | 176.37 | A cat |
| ½ oz | 15.552 | 0.5 | 0.549 | Pencil |
| 1 oz | 31.104 | 1 | 1.097 | Slice of bread |
| 3 oz | 93.311 | 3 | 3.291 | 2 large eggs |
| 5 oz | 155.52 | 5 | 5.486 | Baseball |
| 10 oz | 311.04 | 10 | 10.971 | 2 D alkaline batteries |
| 20 oz | 622.07 | 20 | 21.943 | NBA basketball |
| 25 oz | 777.59 | 25 | 27.429 | 2 cans of soup |
| 50 oz | 1,555.2 | 50 | 54.855 | 4 footballs |
| 100 oz | 3,110.4 | 100 | 109.71 | Newborn baby |
| 500 oz | 15,552 | 500 | 548.57 | 3-year old child |
| 1,000 oz | 31,104 | 1,000 | 1097.1 | Golden retriever |
The Good Delivery system is a series of standards and rules established by the London Bullion Market Association to describe the physical characteristics of gold and silver bars used in the London precious metals market. The rules encompass not only the characteristics of the gold and silver bars themselves, but also set requirements for approved refineries and set up a number of companies as referees for the system.
Silver Good Delivery bars must meet a minimum fineness of .999 (99.9% pure silver) and must weigh between 900 and 1,100 ounces. Bars must also be marked with a serial number, a year of manufacture, their fineness, and the refiner’s hallmark. There are also a series of recommended dimensions for Good Delivery bars.
Any bars that don’t meet Good Delivery standards must be marked with NGD, for Non-Good Delivery. This system helps ensure that the bars that circulate in silver markets conform to a universally accepted set of standards.
|
Advantage of Small Silver Bars |
Description |
| Affordability | Small silver bars cost less than large silver bars. |
| High Liquidity | Small silver bars can be easier to sell than large silver bars. |
| Easy Storage and Transport | Small silver bars are easy to store and transport. |
| Gifting | Small silver bars can make affordable gifts. |
In absolute terms, small silver bars are cheaper than large silver bars. A 1-gram silver bar may cost you about $10, while a one-kilogram silver bar will probably cost you several thousand dollars.
For those with smaller budgets, buying smaller silver bars will allow you to buy more silver bars than if you were to choose large silver bars.
Silver markets are already highly liquid, with silver trading around the world nearly 24/7. But when it comes to selling the silver you own, you want to know whether there will be a buyer available.
Because small silver bars cost less, it can be easier to find a buyer for them when it comes time to sell. The number of people who can buy a $100 silver bar is going to be much larger than those who can buy a $10,000 silver bar.
Silver may be a very compact store of wealth, but large silver bars can be bulky and heavy, with the largest 1,000-ounce silver bars weighing more than twice as much as the largest commonly available 400-ounce gold bars.
This means that those large silver bars can be very difficult to store and transport. Compared to large silver bars, small silver bars are easy to store at home.
You can have some tucked away on a bookshelf, some in your sock drawer, and some in your desk. And small silver bars are easy to transport from place to place in a purse or even your pocket.
If you have children or grandchildren whom you want to teach about the importance of precious metals in helping to protect and build wealth, a small 1-gram or 5-gram silver bar can be a relatively inexpensive way to introduce them to precious metals.
Of course, there are some disadvantages to small silver bars too.
|
Disadvantage of Small Silver Bars |
Description |
| Higher Premiums | Premiums on small silver bars are often higher than on large silver bars. |
| Not as Cost-Effective | Per unit cost of silver is higher when buying small silver bars than large silver bars. |
One of the major disadvantages to small silver bars is that you’ll pay higher premiums versus the spot price of silver than you would for larger silver bars.
A 1,000-ounce cast silver bar is relatively straightforward to produce. Just pour 1,000 ounces of molten silver into a mold, let it cool, then stamp it with a hallmark, serial number, and fineness, and you’re done.
With a small silver bar like a 1-gram or 5-gram silver bar you’re going to be minting that bar on a specialized press. To get the equivalent of 1,000 ounces of silver, that means you would need over 6,000 5-gram silver planchets or over 31,000 1-gram planchets, minting each one with specialized dies that you’ve designed and machined.
Silver bars are also produced in sizes as small as 1 gram, which are so small they can be easily lost, so they’re often placed inside a plastic holder with a specific bar code, QR code, or other certificate of authenticity.
The amount of work it takes to produce 1,000 ounces of 1-gram or 5-gram silver bars is a lot more than it takes to produce a single 1,000-ounce silver bar, and that will be reflected in a higher price per ounce of silver on the smaller bars.
That means that if you’re looking to buy silver at the lowest unit cost, buying smaller silver bars, or the smallest silver bars, may not get you the best bang for your buck.
When looking at small silver bars vs. large silver bars, you’ll want to balance your desire for liquidity and compactness with the ability to maximize how much silver your dollars can buy.
|
Advantage of Silver Bars vs. Silver Coins |
Description |
| Lower Premiums | Silver bars sometimes command lower premiums than silver coins. |
| More Efficient Stacking | Silver bars that are rectangular or square offer a more efficient use of space than round silver coins. |
| Wide Size Range | Silver bars are available in a wider range of sizes than silver coins. |
Compared to silver coins, silver bars sometimes command lower premiums. While the savings per unit may be small, if you’re making a large silver purchase that difference in premiums could add up.
Square or rectangular silver bars are more efficient at saving space than round silver coins, as they maximize use of corners. Stacking silver coins also generally requires buying coin tubes, some of which are round also and don’t stack as well as square tubes.
If you’re buying large amounts of silver, silver bars may stack easier and help you minimize the storage footprint of your silver.
Among the most popular sizes for silver coins are ½-ounce, 1-ounce, and 2-ounce silver coins. You may occasionally find smaller silver coins, like ¼-ounce or 1/10-ounce, and the largest silver coins you’ll likely see are 5-ounce and 10-ounce coins.
Silver bars, on the other hand, are available in over a dozen different weights, measured in both metric weights and troy ounce weights, ranging from one gram up to 1,000 ounces. If you have a specific weight of silver that you want to buy, you might have a better chance of finding it in silver bars rather than silver coins.
Silver bars have disadvantages, too, which is one reason silver coins remain so popular.
|
Disadvantage of Silver Bars vs. Silver Coins |
Description |
| Low Divisibility | If you buy larger silver bars, you can’t divide your silver holdings easily to sell your silver. |
| Authentication Issues | Large bars may require authentication and testing when you sell, adding time and expense. |
| Lower Liquidity | Not as many people may be familiar with silver bars compared to popular silver coins like Silver American Eagles. |
| Need for Storage | Larger silver bars may require specialized storage, whereas silver coins are easier to store or hide at home. |
| No Numismatic Value | Silver bars don’t have any collectible value, whereas certain silver coins may have added collector value beyond just the value of their silver content. |
If you buy large silver bars, you can’t sell small portions of your silver holdings, you’ll have to sell the entire bar. You might have to wait a while to find someone able to buy a 1,000-ounce silver bar, so it might be easier to sell off 1,000 1-ounce silver coins piecemeal over time.
Depending on how large your silver bar is or how it’s packaged, the buyer may want to assay and test it upon delivery. That can add time and expense when you want to sell.
If you try to sell your silver bars locally, local buyers may not be as familiar with silver bars, particularly from smaller or less well-known issuers, than with popular silver coins from mints like the US Mint, Perth Mint, or New Zealand Mint.
That could mean lower offers to buy, or perhaps buyers passing on buying your silver bars.
Larger silver bars, while they’re still a compact store of value, can be harder to securely store at home. Especially if you have large silver holdings, that may require you to buy a safe or store your silver bars in a safe deposit box, which adds expense.
Silver coins can be hidden discreetly around your home.
Some silver coins can gain extra value to collectors through rarity, condition, or other factors that make them more valuable than just their silver content. Silver bars don’t normally have that added numismatic value.
How can I tell if a silver bar is real?: There are numerous ways to check if the silver bars you have are real. One of the first things to do is to check if the bar matches the published dimensions and weight.
Silver bars are also non-magnetic, so they should not be attracted to a magnet. Silver also makes a distinctive pinging sound when it is struck, versus base metals which have more of a thudding sound.
Finally, there are chemical tests that can be done by professionals, although these may damage your silver products.
But one of the best ways to avoid counterfeit silver is to work with trusted partners like Goldco who work with mints around the world to bring you guaranteed authentic gold and silver so that you don’t have to worry about possibly buying counterfeit silver.
What is the best silver to buy?: That all depends on your particular needs and how silver fits into your financial planning.
For some people, silver may make up a large portion of their portfolio, and they may hang onto it for a long time. Others may only want to buy silver as a short-term hedge against a possible economic downturn.
And other people may just want to hang onto a few silver coins or silver bars at home in case of a rainy day. How much silver you buy and the form you buy it in will be determined by how you plan to make use of your silver.
How can I keep my silver bars safe?: Silver that you buy with a direct cash purchase can be stored at home, in a safe deposit box or, if you’re making a particularly big purchase, can be stored in a bullion depository.
If you’re buying silver through a silver IRA, your silver bars will have to be stored in a bullion depository. Goldco works with experienced precious metals bullion depositories to ensure that our customers’ precious metals assets remain safe and secure.
What precious metals can I hold in a silver IRA?: Silver IRAs aren’t limited to just silver. These precious metals IRAs can also hold gold coins or gold bars, as well as platinum and palladium bullion.
What kinds of silver bars are IRA-eligible?: IRAs are only allowed to acquire silver coins or silver bars with a minimum fineness of .999 (99.9% pure silver). Using IRA assets to purchase silver coins or silver bars with a lower silver content that are not IRA-eligible would be considered a distribution of assets and could subject you to taxes and penalties.
Can I take physical possession of the silver in my silver IRA?: The silver in your silver IRA must be stored in a bullion depository, but you may take possession of that silver when you decide to take a distribution through an in-kind distribution.
Some companies claim that there is such a thing as a home storage IRA, which purportedly allows you to purchase gold and silver using IRA assets and store those precious metals at home. These types of arrangements have been explicitly banned by tax courts, and anyone attempting to start a home storage IRA could face significant taxes and penalties.
How can I fund a silver IRA?: One of the most popular ways to fund a silver IRA is through a silver IRA rollover. You can roll over assets tax-free from an existing retirement account such as a 401(k), 403(b), TSP, or IRA account into a silver IRA.
Goldco’s precious metals specialists have helped many customers navigate this rollover process. Contact our specialists to learn more about how the silver IRA rollover process works.
I already own silver bars. Can I move those into a silver IRA?: IRAs are prohibited from engaging in certain transactions, including IRA owners selling their property to an IRA.
This is why it can be helpful to consult with your financial advisor or tax advisor to go through the IRA rules and regulations in order to make sure that you don’t inadvertently end up making a mistake that could subject you to taxes and penalties.
There are numerous ways to buy silver bars, from going down to your local coin shop, frequenting online marketplaces, or finding established precious metals companies that can provide you with silver products.
Silver can be purchased as a direct cash transaction, allowing you to take possession of your silver and store it in whichever way you see fit.
You can also buy silver bars for a silver IRA, which allows you to own physical silver within a tax-advantaged retirement account.
Silver IRAs can be funded through tax-free rollovers from existing retirement accounts such as a 401(k), 403(b), TSP, or IRA account. And when you take a distribution from your silver IRA, you can take it either in cash or in silver.
As with any other asset purchase, whether you choose to buy silver bars is a decision that you’ll make after assessing your unique individual goals. Each person’s financial situation, time horizon, and financial ability can play a role in whether they buy silver bars.
Some people look to silver as an inflation hedge against inflation that remains stubborn. Others may fear a potential financial crisis, and look to silver as a safe haven asset, hoping it will perform in the next few years just as well as it did from 2008 to 2011.
And other people may just want to diversify their portfolios a little bit, just in case.
If you’re looking to buy silver, no matter the reason, it can be important to work with trusted partners who can provide you with the products and support you need.
Goldco has worked hard to make ourselves one of the top gold and silver companies in the country, and our more than 8,000 5-star reviews are a testament to the lengths we go to provide premium gold and silver products and exemplary customer service.
Our specialists have helped thousands of customers benefit from adding silver to their portfolios. Will you be next?
Call Goldco today to learn more about how owning silver can help you safeguard your financial future.
Silver bars are produced in a variety of different weights, measured in troy ounces, grams, or kilograms, to accommodate a wide variety of purchasers’ budgets Small silver bars can offer...
Key Takeaways Beyond inflation hedging, gold is reemerging as "politically neutral collateral" for nations wary of reserve assets that can be frozen or sanctioned by foreign powers Unlike...
Even though many gold products are of high purity and easily traded, gold is not considered a high quality liquid asset (HQLA) under Basel III banking regulations The London Bullion Market...
PLUS! Act now and get up to 10% in Bonus Gold or Silver!*
*Applies only to qualified orders. Get up to 5% back in FREE Gold or Silver when you purchase $50,000 – $99,999 in Goldco premium coins. Get 10% in FREE Gold or Silver when you purchase $100,000 or more in Goldco premium coins. Cannot be combined with any other offer. Additional rules may apply. Contact your representative to find out if your order qualifies. For additional details, please see your customer agreement. Goldco does not offer financial or tax advice regarding the purchase of precious metals.
