Should You Invest In “Junk Silver” and Other Precious Metals For Survival?

Investing in Junk Silver CoinsI’ve noticed a lot of emails from readers recently asking me about investing in precious metals as a hedge against inflation. Since this is a subject that I’ve not covered before on TheSurvivalistBlog.net, I thought I would share my views on the topic for you in today’s post.

But before we get into the how to do it (or at least how I do it), let’s look at a few of the negative points of investing in metals and why I think you should invest mostly in other types of barter goods and survival gear.

Who Will Know…

For many people, the value of junk silver coins, for example, may not be conspicuous and it could be difficult to convince them that your coins are worth more than face value. Take your “junk silver” down to the nearest convenience store and try to get more than the face value at the checkout counter and you’ll see what I mean.

Money, gold, silver or whatever exchange medium you are using must be accepted before it is worth anything…

To get more than face value for your coins you’ll probably have to deal with a specialist, if not you had better be ready to explain what you have and why it is valuable to someone who has no idea of what you’re talking about. Good luck with that they will probably think you’re a confidence man or something.

When the stores have been empty for weeks and Joe six-pack is down to his last can of green beans, don’t expect him to trade that can to you for your “junk silver” coin.

What Will It Be Really Be Worth…

Someone without food, medicine, shelter or a means of protection, will want those life-sustaining basics much more than they will any form of currency. After all, they can’t eat gold or silver, they can’t plant it, they can’t use it to provide energy, they can’t wear it. Basic needs must be taken care of first – for that reason, I look for the price of collectible metals to plummet after a far-reaching end of the world type event at least until people start to rebuild.

It comes down to the type of disaster and how bad things are after the fact that will decide if people see coins as valuable or not. But, people will always need to eat, drink, stay warm and be protected.

Think about it – the nation has been devastated by a widespread epidemic disease, millions are dead the economy, power grid and transportation have collapsed. Which would you rather have a .22 rifle and box of ammo or a hand full of gold coins?

Who would trade you their .22 rifle and ammo for your pieces of metals? I wouldn’t and I doubt your neighbors would either…

At best hoarding such metals would provide limited protection during an economic crisis with no guarantee of being able to trade for what you need when you need it. It’s best to already have what you need to be put away so you don’t have to go looking to exchange those pieces of metal for life-sustaining basics.

Gold and Silver Confiscation…

Literally tons of gold were ripped from the hands of ordinary Americans after Franklin D. Roosevelt penned the first law to seize certain precious metal assets during the Great Depression.

Who can say for sure that it will not happen again? It probably will…

I’ve read many comments on this and other survival blogs pondering the possibility of food confiscation and redistribution after a disaster and while this is a real possibility, I think we would be more likely to see the confiscation of metals such as gold and silver especially if the disaster is economic.

Laws such as the “Trading with the Enemy Act,” and the 1977 “International Emergency Economic Powers Act”  have opened the door for future confiscation. Remember; you can legally have only what the government says you can have and they can make you into an instant criminal with the stroke of a pen.

Don’t think because your assets are held in precious metals that your wealth is safe – it isn’t.

Should You Do It?

From my statements above you may think I’m against hoarding precious metals – I’m not. Just don’t go crazy collecting gold and silver coins, get your basic survival needs first.

Remember, you can’t eat a silver coin or gold, it can’t keep you warm, it can’t protect you from attack and you can’t live in it. On a personal survivability standpoint, it isn’t all that important…

What I Do and You Should Too

After you have your other survival needs taken care of you might want to invest some of your time collecting and hiding coinage – here is what I do…

From 1837 to 1964, the United States dimes were made of 90% silver and 10% copper—just like the Morgan Silver Dollar. I double-check all my pocket change for these – since pre-1964 dimes have become numismatic collectibles, I don’t find many this way but when I do I quickly put them away.

Similar to dimes, United States quarter-dollar pieces were also made of 90% silver and 10% copper from 1932 to 1964. I treat these in the same way as pre-1964 dimes. These quarter-dollar pieces are exactly 2.5 times as heavy as silver dimes and obviously have more value.

Aside from checking your pocket change, you can buy junk silver coins at a markup, but I would rather get them for free. Creekmore, how in the Sam Hill do you get them for free you ask – with a metal detector, of course. You would be amazed at what you can find with these if you take the time and know where to look.

I like to look around old home places (with permission) schools, and churches. Do your research and keep in mind that you’ll have to hunt the older places to find quality coins – look for areas that were in use before 1964 and you will have a better chance at finding the coins that you are looking for.

This is how, I’ve found the bulk of my junk silver coins and an approach worth considering for anyone interested in putting back junk silver coins against the day of need. A good book to help you get started if you’re interested in doing this is Metal Detecting for the Beginner.

I also save all of my nickels – the composition of a nickel has been unchanged since the end of World War II in that it is still a 5-gram coin made of 75% copper and 25% nickel, with the metal value being worth more than the face value of the coin. Check http://www.coinflation.com/ for the current value.

Also Read:

Also, check out – Renaissance Precious Metals for your PM needs.

What Do You Think?

Should collecting metals be a top priority? What are you doing? Let use know in the comments below…

About M.D. Creekmore

M.D. Creekmore is the owner and editor of TheSurvivalistBlog.net. He is the author of four prepper related books and is regarded as one of the nations top survival and emergency preparedness experts. Read more about him here.

Comments

  1. Brian F says:

    I have given a lot of thought to precious and semi precious metals after a down fall. I my self would not consider trading skills and food for what will then be useless junk. The only metals I stock up on are lead, and hand tools. With my collection of hand tools old and new I think I can build most anything including a forge and a small blast furnace. As quite a few of my articles indicate.

    • M.D. Creekmore says:

      Brian F,

      You have to consider what “a real economic collapse” is like and not what you’ve read in a fiction novel. In a real economic collapse PM will be really useful to have – especially after people start to rebuild. As will skills like you said. It’s best to cover all the angles when prepping if possible. But get your own survival necessities squared away first ie food, weapons, medical, tools etc and then consider PM investing just don’t go crazy with it.

      • Brian F says:

        On economic collapse I base on my grand parents experieces of the Great Depression. Who knows what may or may not happen? I try to be flexible,

      • I do agree with what you say. After a crash of any type, people may or may not want to trade for precious metals. I think it’s a good idea to have some but I wouldn’t necessarily have all pre-1964 silver. I have one ounce silver rounds which are a good trade unit. Also, for people who have a whole lot of money and want to protect it, precious metals are really the only choice. If you leave it in dollars and they become worthless, your wealth just disappears, which won’t happen with precious metals.

  2. JP in MT says:

    I will say this from personal experience, PM’s came in very handy when we needed cash. As background, I was looking for a way to “park” some money, and I like PM’s anyway. So I would park money in PM’s when I had prep money and nothing else to spend it on at the time.

    Well, we had one of those personal SHTF moments and I needed cash. I knew a business man who bought PM’s and offered mine. I got $1840/oz. for the gold and $38/oz. for the silver. It was more than I paid for it and a good sale price. It also turned out that the next business day both started dropping in price.

    So, any PM’s that I replace at current prices means that I gave myself and interest free loan!

    I will be the 1st to admit that my unknown timing was excellent. This does not always happen. You have to be VERY patient with commodities. But at least with PM’s, they will always be worth something. Most of us will spend the money on something, so, after you “invest” in what you need, why not “invest” in something that my increase in value later that still has value now? (I feel that current prices are a buying opportunity, not a selling one.)

  3. Halfway Homesteader says:

    I’ll be honest, and I never tell folks what to do. Only what I do. But I don’t see much point in hoarding silver and gold. My investment portfolio consists of a traditional 401k, and my work pension as cash objects. I purchase good quality firearms and take care of them when I can. That way I get to enjoy them while I have them, and they’re quite easy to liquidate at a profit if I need fast cash. I keep $18,000 in cash in a hidden compartment in the gun safe (my father always taught me to have 6 months of bills, ALL OF THEM, saved up in cash on hand). Otherwise, my income goes into paying off my house and 3 acres as quickly as possibly. Once that is done or close to done, I plan on making offers to absent land owners in my area. Land, to me, is the best investment in history. Gods mot making anymore of it. And I imagine more folks would be inclined to barter for my hay, my vegetables, my pork, eggs and chickens that that land provided me, than any shiny coin. Again, just my opinion, and everyone’s situation is different.

    • HH, love the thinking, remember one thing…as long as the government owns us (and yes they own us if we vote and believe them necessary) your taxes and their laws (imminent domain) ensure you will never “own” property-

      Hence we westerners and our sagebrush revolution of over 60 years now 🙁

      • patientmomma says:

        Jesse, agree. the govt giveth and the govt taketh away at their pleasure. IMHO, in an economic disaster PMs might be good for paying off the govt (taxes), depending on whether the govt allows PMs to exist in common folks’ hands.

        Lots of folks think the govt won’t be coming after them for taxes; humph; like the banks won’t take your savings accounts or foreclosure your house. Read about the Great Depression; taking land and homes is what the Robber Barons do for a living.

  4. believer says:

    My maternal great grandfather came to America from Germany after their depression. Paper money was so worthless that it was used as toilet paper. a bushel basket of money could get you a bushel basket of potatoes. Looking at what is happening in Venezuela with their paper. I kind of think that a shopkeeper there would rather take silver than paper. Precious metals have always had worth and if you don’t think so ask yourself why so many of the worlds banks are so interested in acquiring gold? It won’t take long to establish what the price of a silver or gold coin is worth.
    Personally I wonder about how much gold we have in fort Knox. Is it still there or has it been sold?

    • believer says:

      Meant to add that I can afford to stockpile nickels. When I started getting nickels they had a melt value of 5.3 cents apiece. Today they are worth 3 cents apiece for melt value. But on the economy they are still worth a nickel each. Kind of hard to separate the nickel from the copper in a coin but monel is a nickel copper alloy that does have worth on the world market.

  5. Antique Collector says:

    When dh first started collecting I thought he was nuts, but as time went along I realized that it was better to have a fall back in case we needed to convert it to paper.
    There are states that are going back to the acknowledging PM’s as a currency. It can be exchanged for paper fiat currency, without any taxes. Believe it up to 11 states now, there could be more from the last time I checked. Each state has different regulations on how it handled.
    What many do not realize, PM’s are the TRUE coin of these United States, not paper. It’s only value is what the .gov gives it, for commerce & trade.(Know I just opened up a can of worms as the saying goes)

  6. I have invested in some eagles. Like JP, I see such investments as a way to park money. It’s safer than keeping the money in the bank and I have something to fall back on. I can’t access my 401K without penalty for another 20 years. This is just an insurance policy. Like Believer, I think it is important to have easily recognizable tangible silver like American Eagles–the folks that had tangible silver and gold were able to bribe their way out of Germany and other occupied territories.

  7. My thoughts. Most forms of currency will be useless after a true collapse. If food is scarce, no one will trade you their food for any amount of junk silver. There are many things that will hold value during and after a major collapse. The top 3 in my opinon are as follows. Number one item will be potable water and ways to make more. Thirst is a terrible thing. Number 2 will be food and ways of producing more. Number 3 will be medical. When you or a loved one is sick, you will do anything to get treatment. Having medical knowledge and supplies will be a game changer. Notice I do not include ammo in this. I do not believe you should provide anything in trade that can be used against you. As far as precious metals, I have them along with stocks, bonds and cash. Not for a collapse, but for a good future if a collapse does not happen. You can not just pretend that everything is going to fail and therefore there is no need to plan for a long healthy life. To do so is foolish. You need to plan for all aspects of the future good and bad.

    • Precious Metals will always retain value as an easily utilized barter form 🙂 (they always have, if only because gold and silver was seen as a protection against demons and the things that bump in the night since way back, and evolved 🙂 haha

    • Santawalt says:

      I agree with JAS. You need to ask yourself some questions about having gold to use, esp. if it looks like it will be long term. The first question is whether you would take gold in a barter situation? How would you know if its real gold, bite like they do in the movie? If you can make a dent, how do you know its not lead with something mixed in to make it look like gold–maybe fools gold. That’s a start. You take it from there.

      • Antique Collector says:

        By being wise, gold has a weight and so does silver. It is hard to copy in the fake coins, make sure you have a small scale with the proper weights for each pm. Some I learned watching history channel a while back.

      • Knowledge of mohs scale, easily obtained and easily utilized. Gold is quite easy to verify actually

  8. I invest when I have money, and love this article! Awesome!

  9. MD,

    Please let Matt know I got the Mora knife and package on Saturday, just like he said I would.

    I think it’s a good idea to have some precious metals on hand but a better idea to have other barter goods. Liquor leaps to mind as it doesn’t take up much space, or need refrigeration. I wouldn’t barter ammo or guns unless I knew someone really well and trusted them AND they had something I desperately needed.

    That said, skills are the most valuable barter item you can have since you never run out of them.

  10. NG in west Tennessee says:

    It’s unfortunate most Americans are owned like George Carlin stated,The u.s. government is not going to confiscate nothing round here, that’s what all the rifles are for, we didn’t get them for ghetto thieves or rag head terrorist, it does no good to have something if you can’t keep it .

  11. In the American Redoubt, PMs are already being used for economic trade, and many people in the region, not just “preppers”, are well aware of their intrinsic value over fit currency Federal Reserve Notes. Walmart may not accept them, but many local merchants will, and they are the ones you should patronize first.

    Confiscation is theft, and theives should not be tolerated. With that said, you have two choices available when someone tries to take what is yours. You either let them, or try to stop them. Attrition when the latter option is chosen will resolve that problem one way or the other.

    Finally, once the TEOTWAWKI Zombie Apocalypse, or whatever, is over, some of us would like to rebuild society, and correct some past mistakes. Like our currency mess. Barter has been historically shown since biblical times to be unworkable for anything beyond a “me Tarzan, you Jane” level. Why do you think PMs were used in the first place? As a bonus, they are also EMP proof.

  12. Goatlover says:

    After a couple of years of prepping, I got my husband interested in 2 aspects of preparedness: bullets and bullion. Boy, howdy, he sure had fun accumulating BOTH. Finally got him to admit he had enough PMs. That man’s crazy! LOL I see silver as a means of exchange in the event of total financial collapse. Not right away, but after things have settled down and basic commerce reemerges. Up until then, I might only barter with seeds (a renewable resource).

  13. Chuck Findlay says:

    Remember, you can’t eat a silver coin or gold, it can’t keep you warm, it can’t protect you from

    attack and you can’t live in it. On a personal survivability standpoint, it isn’t all that important…

    If you go to U-Tube and watch FerFal’s video talking about this he (He is one of the few people that did experience an ecnomic collapse) does say you can eat and buy other things with PM’s. All kinds of exchange shops opened up and he and everyone else in Argentina was able to flip PM’s for the currency of the day and buy what they wanted.

    So yes you can eat PM’s.

    Personally I buy silver as a way to park my money for later use. I have a lot of silver, but I prepped for years before I bought any silver. I got all my other preps set before I got the silver.

    I now make a good living doing home repair and it’s easy to buy preps and silver. In fact I’m at the stage where I’m running out of room to store all the preps I have. This makes it easier to decide to buy more silver (just bought 14 oz this week.) Silver is easy to store and it feels good to have it…

  14. Chuck Findlay says:

    PM’s likely will not offer that much value during a collapse or at least the first stages of one.

    But all bad times go away at some point or at least settle out to a new reality that will likely offer a person with PM’s the opportunity to use them to buy things.

    I feel they are a way to save my labor that I do today and use it on the other side of an event.

    The phoenix always rises form the ashes to soar again, meaning society will come back. People don’t like anarchy and will not put up with it for long. If government doesn’t bring order people will do it themselves. This is where I see PM’s being useful for me. And if we never get a bad ecnomic SHTF I will just cash in my silver at some point to use to make my life better at that time.

    I have trouble believing that the US Dollar is going to survive as far as it’s buying power, I just can’t see parking much of my hard-earned money in US Dollars.

    As far as Barter

    I invest in skills, tools to do my work, supplies that I use in my work, preps, food, and silver.

    I don’t see PM’s as a barter item for me personally.I can fix most things people have in their homes, farms and businesses. I have my own handyman business so I’m doing this now. I have been a reloader for years (use to make a lot of extra money reloading for a gun shop) I don’t like doing it these days, but I am good at repairing autos, my dad was an auto mechanic and I was helping him on the weekends since I was 5-ears old. I am very good a modifying things to re-purpous them to come up with a new useful things. And I build a lot of useful things people could use, this is my barter item, not PM’s.

  15. Richard says:

    Have you ever had to re-type a comment because you felt like a babbling jerk or didn’t like what you were saying???
    That’s me with this subject.
    * Without going crazy, my DW & I invested in both scrap & pure gold as well as silver during a big dip in the market a few years back.
    We were still fairly new to our change in life-style to become more “prepared” and didn’t have all our needs covered like we wanted.
    But we knew that a dip that low in the gold/silver market was the best timing for us to make a move. So we did without being crazy about doing so.
    My DW is a great deal shopper, so we figured out how to get the most bang for our buck and stuck to that. Price 10, one ounce rounds/bars compared to one 10-oz bar and you’ll see what I mean.
    * We also know it won’t be long till someone gets smart that it’s time to change the little 5-cent nickel to a cheaper clad coin like the dime and quarter is today. ($0.12 to make one nickel ! )
    So we began obtaining boxes ($200 in nickels per bank box) while we could. There’s no loss in value because each is still worth $200 per box.
    ( BUT it is a heavy $200 )
    We still pull out nickels from our change to save.
    * We got what we set our limits to and went back to working on our NFL’s (needs-for-life)
    We only varied in the advice of MD’s article because the market for gold/silver and we took that chance while it was in our favor.

  16. Mr. Gray says:

    In my opinion
    we won’t see a complete back-to-the-Middle-Ages collapse. I believe it’s more likely that we’ll see a time of turmoil and martial law with intermittent utility service and greatly reduced (but not ended) food transportation/delivery. I also believe that in such a scenario, creditors will be calling in their debts, trying to get as much cash as possible for themselves.

    If this is accurate, gold and silver will be extremely useful like this:
    1- If we still have intermittent utility service, you’ll still have to pay for it. The dollar will likely be almost worthless but metals will have skyrocketed in value. It’s likely that several ounces of silver could pay for heating your house during the winter.
    2- Certainly the grocery store shelves will be stripped bare early on, but food delivery may still exist, although intermittently. If a crowd of people is waiting for the store to open, it is likely that whoever is in charge distributing the food would bring some goods out the back door for you in exchange for a coin or two.
    3- Lenders will be desperate for assets like everyone else and will be trying to foreclose on your home. An ounce of gold could keep a roof over your family’s heads.

    Remember the saying:
    “Always have enough gold to bribe the border guards.”

    • Chuck Findlay says:

      Remember the saying:
      “Always have enough gold to bribe the border guards.”

      And or a nice Swiss watch to slip the guard.

      A watch is easily portable and easy to have on you so you don’t forget it. While there are many brands of Swiss watches, Rolex is probably the best brand to have as everyone knows it.

      I don’t like fake or knock-off things, but for a border crossing bribe a fake Rolex could be the thing to have. Some of the better fakes (that can cost $200.00) can fool an expert so a border guard would not likely know it’s fake.

  17. As a child of depression parents the coffee can behind the house in the garden. That was natural growing up. Now I have increased the amino position of our stash. Need more but PM’s have been saved over last 100 years.

    • Chuck Findlay says:

      I replace the coffee can with a 4 inch PVC pipe with one end capped and the other end with a screw on clean out plug.

      I made a few of these and have them in various places. I have one that is 15-inches long and full of one-ounce silver bars hidden (under ground) in the back yard.

      Wrap teflon tape around the threads and it’s water tight and will last for hundreds of years.

  18. Michael says:

    I think that after SHTF a bartering system will be most effective. Unless our food, water and survival goods are confiscated. And that brings me to the next point…expect your gold, silver and other precious metals to be confiscated as well. So the gov’t will get all of our stuff for free by theft.

  19. I agree 100% with this author. For those of you that respect the word of God remember this:
    Eze 7:19  They shall cast their silver in the streets, and their gold shall be removed: their silver and their gold shall not be able to deliver them in the day of the wrath of the LORD: they shall not satisfy their souls, neither fill their bowels: because it is the stumblingblock of their iniquity. 
    Jas_5:3  Your gold and silver is cankered; and the rust of them shall be a witness against you, and shall eat your flesh as it were fire. Ye have heaped treasure together for the last days.

  20. poorman says:

    Well its just my humble opinion but I think PM’s WILL have a place in a collapse . there will always be people or groups that have more than they need such a a warlord, our government ect. they will need some form of exchange and or payment. If they have gone through area’s they will have food,water,woman,slaves,livestock,guns and ammo but what good is taking all of this and having nothing to exchange it for. In every fallen civilization I have heard of whether it was Germany,Venezuela, Argentina, Rome or any middle age country gold and silver always held value. Will it be worth anything the day of the collapse ,probably not but sooner or later the dust will settle and people will need some form of wealth for barter. It was used by the Jews and later by the Nazi’s to buy their way out of Germany. It was used on the black market during the Korean War it was even used to pay Judas for betraying Jesus. It is not going away

  21. I am kind of a “both and” kind of guy. We do have an amount of silver, coins, rounds and bars and also gold coins. Not a huge amount, but it seems to me to be a reasonable balance. Also a couple thousand paper money stashed in the safe available for immediate use. As a prepper the last four years, we have accumulated a lot of food and other supplies to be prepared for catastrophe. I have seen the decrease in the value of paper money, as well as reading of the runaway inflation in Germany after WWI and Venezuela today.

    The catastrophe I consider most likely is total economic collapse of the nation. I have absolutely no belief Congress will ever come to grips with their spending problem. Given their inability to even modestly rein spending in and the reality that there is not enough income in the country to cover their expenditures, they have no option but to continue printing money at a headlong rate to cover their deficits. The day will arrive when the rest of the world will discontinue honoring the US dollar and convert their holdings into hard assets. It will make no sense to hold an asset that continues to decrease in value. That’s when the dollar will suddenly lose most of its remaining value. Having prepared supplies and some PMs will be a very good thing.

  22. Ben Leucking says:

    Bottom line: You can’t eat precious metals. If anyone attempted to barter silver/gold with me for ANY consumable, such as food, fuel, ammo, etc., I would reject their proposal.

    • Ben Leucking says:

      I have long kept one ounce of gold in 1/10th ounce Krugerrands. I do not expect that they will ever be of any practical value for my survival. Can you imagine trying to barter $40 worth of anything with a coin worth $160? Are you willing to accept $120 in worthless currency? Not me. Now that I think about it, I would rather convert the coins to the equivalent in food or ammo in today’s current market.

      • Why wouldn’t gold and silver have practical value? It has been money for thousands of years. You are way too brainwashed by the almighty dollar like most americans. please try thinking. The ENTIRE POINT in buying silver and gold is so you have money and wealth when fiat fails.

  23. I have a theory. Now correct me if I am wrong, but if silver goes up from where it is today, say $15 or $16 per ounce, due to a collapse of fiat currency, wouldn’t food, bullets, and other supplies go up a corresponding amount ? In other words, isn’t having your wealth in ANY kind of tangible assets as good as having it in gold or silver ?
    Of course, if you have wealth over and above your anticipated needs for food, etc. could be put into PMs, to guard against total devaluation of your fiat currencies.
    Am I right or wrong ?

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