Are My Precious Metals More Safe in My Home or in Storage?
Trying to figure out where your investments are safest can be a daunting task. There may only be two or three choices, but the conditions and what-ifs can drive you up the wall.
Ultimately, the answer to this question will differ for everyone. We advise taking your investment goals, personal preference, and risk tolerance into consideration when making this decision.
There are several things to consider when making the decision to store your precious metals with a third party, such as a bank or depository. Chief among these is security, followed by ease of access to your assets, and finally, cost.
The Pros and Cons of Storing Bullion With a Third Party, Like a Bank or Depository
Constant Security. The biggest benefit of trusting a third party for your storage needs is the relief that comes from knowing your metals are being watched over, 24/7. No matter how far from town you are, your silver and gold are under a watchful eye, and backed up by security measures, insurance, and surveillance.
They’re not in your home. Emergencies are not restricted to working hours and you may need to access your investments outside of banking hours.
Banks Keep Your Metals Safe Just Down the Street
Pros of Storing Your Metals at a Bank
One of the biggest benefits to choosing a bank to store your gold and silver is getting the best of both worlds, in terms of storage and proximity to your home. Your bank is probably closer to your home than the nearest precious metals depository, which means it is faster to access your investments when they are stored with a local bank.
If your bank provides storage solutions, you have two choices: A safety deposit box and maybe a bank vault.
Safety deposit boxes may be available in a number of sizes and are reserved for single-customer use.
Bank vaults are a stellar location to store your metals, especially if you have larger items and don’t mind your assets stored with other investors.
Cons to Storing Your Metals in the Bank
One of the drawbacks of storing your precious metals with a bank is the lack of constant access. When your metals are stored at home, you can access them at any time. Metals stored with a bank, however, can only be accessed during banking hours.
Furthermore, they can only be accessed on days that your bank is open. Need gold on a holiday? You’ll be waiting for the next business day. Restricting access like this may prevent you from being able to use your precious metals in a time of urgency.
Another downside to storing your precious metals with a bank is that no matter which option you choose, you may still be paying upwards of $500 per year to store your metals. Depending on what you’ve invested in and how much space that investment takes up, this may be cost-prohibitive.
Perhaps the biggest detracting factor when it comes to storing precious metals with a bank is the lack of coverage under the FDIC. You must buy your own insurance for precious metals stored with a bank.
There are policies that cover precious metals against theft, loss, and damage. But if you buy one of these, wouldn’t it be easier to keep the metals at home?
Depositories Have Storage to Meet Your Needs
Like banks, many depositories will have two choices to select from: Communal and segregated storage.
Pros of Storing Your Precious Metals in a Depository
There are ample third-party gold and silver depositories to choose from, and they will have more storage options, since storage is their business.
In addition to having the facilities needed to house larger collections, depositories can provide moisture and climate control. This ensures that your precious metals will be kept safe from the elements and environmental harm.
The biggest benefit to housing your precious metals assets in a depository is peace of mind from the enhanced security and around-the-clock surveillance they offer. Entrances and exits will be monitored and kept secure with a depository.
Cons to Storing Your Precious Metals in a Depository
Storage fees will often be lower with a depository but storage is not free, so there is an added cost on top of your purchase price.
To take advantage of lower costs with many depositories, you will need to store your precious metals in the same space as other investors. Under the allocated depository storage model, you may not get the exact same product back. Upon checking out, you will receive items in the same condition, weight, and metal.
If your investments have numismatic value, make sure to inquire about segregated storage if your depository offers allocated or communal storage.
Like with banks, there is an issue of constant access. You are limited by the hours that your depository of choice keeps.
It is highly unlikely that a war or geopolitical event will happen in the United States overnight which will give you cause to cash in on your investments. But if one did, you would not be able to access your metals until the next day.
Pros and Cons to Taking Physical Control of Your Bullion
Is the Gold Buried in My Backyard Secure?
Whether X marks the spot, or you have a LaVere Redfield styled basement with a false wall, there are numerous benefits and risks to storing precious metals at home.
Many experts advise keeping several key factors in mind when weighing the decision of whether to store gold and silver at home.
- Protection. You must store your precious metals in an environment free from moisture, dampness, and other corrosive elements.
- Insurance. Update your existing coverage to ensure your gold, silver, platinum, and palladium are insured.
- Social awareness. The fewer people in your life who are aware of precious metals in your home, the better.
Pros to Storing Your Precious Metals at Home
Ease of access: You are always in direct control of your assets. There are no accounting errors, administrative check-ins and check-outs, and you do not need to rely on a third party like a bank or depository.
Control of the environment: You can personally see to it that the environment your precious metals are stored in is not corrosive or damaging.
Since you are always in direct and immediate control of your gold and silver, you can sell it at any time. This provides maximum flexibility and liquidity compared to the other storage options.
Cons of Storing Your Precious Metals at Home
Many renters and homeowners’ insurance policies don’t cover precious metals. Unless your policy specifically states that gold, silver, platinum, and palladium are covered, you should assume they are not.
Risk of burglary: When you lose it, it’s gone.
Floods, fires, and natural disasters can damage your home and the metals within it.
Unless you have a pack of trained guard dogs, there will be no one to watch over your assets while you work, sleep, or travel. This might impede upon your peace of mind from time to time.
The decision to store your gold and silver with a third party or in your home is going to be a matter of preference, convenience, and practical logistics. This decision should be informed by your investment goals, financial circumstances and your risk tolerance. It is ALWAYS advisable to consult a financial advisor before making this decision.
