How to Buy Gold Bullion

Gold Pool Accounts

Gold pool accounts are unallocated accounts in which you own a portion or share of the gold held on deposit, but not specific gold bars or coins.

Gold pool accounts are similar to bank deposits. Suppose you deposit $150 cash in your bank account. The bank accepts your money, but puts it in with all the other money they receive. You still have $150 on account, but none of the dollar bills in the bank are specifically allocated to you. Of course, with money today, most of it is merely an electronic notation on a computer.

Your holdings in gold pool accounts will be an unallocated portion of all the gold the precious metals dealer holds. This allows the precious metals dealer to hold large gold bars which are easier to track and store. Gold in gold pool accounts is stored in secure vaults and is typically insured for full market value against theft and damage.

So, with  gold pool accounts, there are real bars or coins held in the gold vault. A certain number of ounces of gold belongs to you. But, there are no specific bars or coins set aside as belonging specifically to you. You simply own a share or portion of that gold.

Gold Pool Accounts Advantage

The main advantage of gold pool accounts is the reduced charges for storing your gold. An allocated gold account requires a personal storage area dedicated to you and additional services to update your holdings when you buy or sell gold. With a gold pool account, on the other hand, your gold ownership is maintained on a computer and the only requirement is that the holder maintain an amount of gold at least equal to the sum of all the gold in the pool accounts.

Of course, this requires a level of trust in the company storing your gold. They need to have enough gold in their vault to account for all the deposits. While most companies are legitimate, you need to investigate any complaints and invest your money wisely.

Gold Pool Accounts at Banks

Banks that sell gold also provide gold pool accounts. But, there is a major difference between banks and precious metals dealer. When you buy gold from a bank, you will store your gold in the bank’s vault. You actually become a depositor of gold.

While you may think your gold is safely in the vault, the bank and the bank regulators consider the gold to be a liquid asset. The gold is owned by the bank. A portion of the bank’s gold can be sold or liquidated if the bank needs money to carry on its business.

Obtaining Gold From Your Gold Pool Account

Should you wish to take possession of your gold, the precious metals dealer will charge you a fabrication fee to produce smaller gold bars equivalent to your gold holdings. You will be charged appropriate shipping and insurance fees. But, you can take physical possession of your gold at any time.

Probably the most popular international provider of gold pool accounts is Kitco Metals Inc.

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