Are Silver Dollars a Good Investment?
Are silver dollars a good investment choice for you?
If you’ve been around the precious metals market for long enough, you might think that bullion coins and bars are the only way to invest in gold, silver, or platinum. It is true that silver coins and bars are classic methods of stacking silver. For generations, these products have helped investors put their money into silver bullion while cutting down on costly premiums.
However, silver dollars are another good choice for new silver investors. Because silver dollars are still occasionally found in circulation, you may have even seen some of our favorite silver dollars in the wild.
Don’t let their weathered appearances fool you, though. Silver dollars contain actual silver bullion and, to the right collector, could sometimes be worth thousands of dollars. There’s a whole class of investors who specialize in silver dollars, which are often called numismatic silver coins.
Are silver dollars a good investment? The answer to this question leans heavily on your definition of a “good investment.” While silver dollars are a good investment for people who want to diversify their precious metal portfolios with numismatic coins, silver dollars also come with a few big downsides.
Are Silver Dollars Worth Anything?
Silver dollars offer a wide range of values. Some silver dollars are worth little more than their melt value in silver bullion. Other, rarer silver dollars might be worth thousands of dollars. In fact, some auction records suggest that the rarest silver dollars in the world could be worth millions!
The value of a silver dollar depends on 3 main factors:
- Silver Content
- Rarity
- Condition
While there are certainly ancillary factors that influence the total value of a numismatic silver dollar, a coin is generally evaluated based on its silver content, rarity, and condition. This means that some silver dollars may not be worth anything at all – apart from their melt value, of course. On the other hand, some of the world’s rarest silver dollars may sell for millions at auction.
Are silver dollars a good investment? We think so, because all silver dollars have one thing in common: actual silver bullion.
Silver Content in Silver Dollars
All of our silver dollars contain pure silver. Silver dollars actually stopped being made using real silver in 1935, when the U.S. government began making coins using alloys of cheaper, more common metals.
But for the most part, investors who refer to silver dollars are talking about silver dollars minted by the United States before the year 1935. Up until that key date, all U.S. Mint silver dollars contained a standardized silver content of .90 (90%).
Despite their high silver content, some investors stay away from silver dollars because of their high premiums. Are silver dollars a good investment? If you’re looking for valuable silver dollars, you’ll need to understand the history of some of the world’s rarest silver dollar coins.
Rarest Silver Dollars
Are silver dollars a good investment for rare coin collectors?
The rarity of a silver dollar is mostly determined by its mintage figures. Mintage figures refer to the number of a given coin produced during a single year. Sometimes, mintage figures for silver dollars are very high. Take the 1921 Morgan Silver Dollar, for example. This coin is a favorite among collectors, but it remains one of the most common silver dollars in existence.
In just one year, there were over 90 million 1921 Morgan Silver Dollars circulated from the Philadelphia Mint. As a result, these coins aren’t considered rare – or particularly valuable.
This isn’t the case for the silver dollars in the table below, though. These are some of the rarest silver dollars in history, and some of them sold for millions of dollars, smashing auction house records in the process.
Among the rarest silver dollars in history include the 1794 Special Strike Flowing Hair Silver Dollar, 1804 Draped Bust Original Proof Silver Dollar, and the 1794 Flowing Hair Dollar.
Are silver dollars a good investment? If you can get your hands on one of these rare, coveted collector’s items, the answer is a resounding yes.
| Coin Name | Condition | Auction Sale Record |
|---|---|---|
| 1794 Flowing Hair Silver Dollar – Special Strike | SP66 | $10,016,875 |
| 1804 Draped Bust Original Proof | PR68 | $7,680,000 |
| 1794 Flowing Hair Dollar | MS64 | $2,820,000 |
| 1804 Draped Bust Restrike – Proof | PR58 | $2,300,000 |
| 1795 3 Leaves Flowing Hair Dollar | Gem UNC | $1,265,000 |
Pros and Cons of Buying Silver Dollars
Are silver dollars a good investment, despite their high premium costs? To help you get a better idea of whether silver dollars are the right move for your growing silver stack, let’s take a closer look at the pros and cons of buying silver dollars.
Pros of Investing in Silver Dollars
Silver dollars come with 3 main advantages. High numismatic potential, pure silver content, and extreme demand from collectors and investors help make silver dollars a premier choice for stackers looking to diversify their silver holdings. Are silver dollars a good investment? Let’s find out!
High Numismatic Potential
Numismatics is the study of rare or collectable coins. Silver dollars are valued because of their silver content, but they’re also numismatically valuable. Even silver dollars without any actual silver might sell at a premium to collectors.
For savvy stackers, numismatic coins can be a great way to diversify. If your entire silver stack is built by bullion coins with little numismatic value, your collection’s value is being held hostage by the spot price of silver. When silver becomes more valuable, your net worth increases. But when silver enters a downward spiral, your collection’s total value will suffer.
But if you can add some rare silver dollars to your portfolio, you might just give yourself an entirely new way to profit. Are silver dollars a good investment for diversity? The numismatic value potential offered by silver dollars is something that nearly any investor can benefit from.
Pure Silver
Are silver dollars a good investment for silver stackers? If your goal is to invest in pure silver, silver dollars can be a great choice. There’s a caveat to this benefit of buying silver dollars, though. Some silver dollars may sell at abnormally high premiums over spot price. If you’re a budget investor or someone whose goal is to cut down on premiums, you’ll need to pick silver dollars with very little collectable value.
Still, silver dollars do offer a standardized gold purity of 90%. This makes them an excellent choice for stackers who want to add pure silver coins to their collection. When we pair the .90 silver content of silver dollars with their numismatic value and historical demand from collectors, it becomes clear that the silver dollar is a silver stacking tradition here to stay.
Investor/Collector Demand
Why are silver dollars a good investment? If we had to pick one reason why we’re bullish on silver dollars, it would be the long history of investor demand associated with these coins. Even when the Peace and Morgan Dollars first came out, collectors just couldn’t get enough of them.
Today, demand is still ravenous for quality silver dollars. You don’t even need a silver dollar in BU condition to cash in on this extreme interest from coin collectors. A growing class of collectors is actually interested in buying “lowball coins,” which are silver dollars in the lowest possible grade.
Whether you collect the world’s most valuable silver dollars or you plan to stack heavily circulated, cheap silver dollars, high investor demand is a major advantage to putting your money into a certified American tradition.
Are silver dollars a good investment for high liquidity? While silver dollars aren’t always easy to sell, we find that most sellers don’t have trouble finding a buyer for their silver dollars.
Cons of Investing in Silver Dollars
There are two main cons to investing in silver dollars: high premiums over spot price and a lower silver content than bullion coins. Are silver dollars a good investment? Before you make the call, take a look at two of the cons to buying silver dollars for your silver stack.
High Premiums Over Spot Price
Some silver dollars are sold at extreme premiums over spot price. If you read our blog regularly, you already know that premiums are just part of buying silver, gold, or platinum. Whether you choose to buy coins, rounds, or bars, expect to pay some kind of a premium.
Are silver dollars a good investment on a budget? Maybe. To some collectors, the high premiums over melt value tacked onto silver dollars makes them a sub-prime choice.
It’s worth noting that not all silver dollars are sold at a heavy markup. If you work with an online dealer like Hero Bullion, you might be able to buy silver dollars without paying a crazy premium over spot price. Of course, we can’t promise you’ll be able to buy silver dollars at spot price on your website. But if you’re looking to stack silver dollars without paying unfair premiums, we’ve got you covered!
Premiums also vary from coin to coin. Some rare, historically valuable silver dollars come with extremely high premiums over spot. Other coins might be sold at a minimal markup, making them perfect for budget stackers who don’t want to pay a high premium. Are silver dollars a good investment, despite the high premiums?
The upside to high silver dollar premiums is that they work both ways. In other words, you’ll be able to sell your collectable silver dollars at a considerable markup once you’re ready to cash in. You might not always make a profit buying and selling silver dollars. If profit was guaranteed, then everyone would do it! Are silver dollars a good investment for generating profit? We can’t help you with this one – you’ll have to do a bit more research to get a feel for the market.
Lower Silver Content Compared to Silver Bullion
Are silver dollars a good investment if your goal is to stack pure silver? Yes and no. On one hand, silver dollars do contain real silver bullion. Unfortunately for some perfectionists, these old American coins just don’t stack up to the purity of modern bullion products.
Most silver dollars contain a fineness of .90, or ninety percent. This is just under the purity levels of the American Gold Eagle Coin, which clocks in at .9167. But for most modern silver coins, standard fineness is closer to .999.
This doesn’t matter much to most investors, but some collectors just prefer to stack the purest silver possible. But hey, we can’t blame the old U.S. Mint for not meeting today’s bullion standards!
How to Buy Cheap Silver Dollars
Are silver dollars a good investment if you’re on a shoestring budget? This depends on which coins you choose to buy. In this section, we’re going to give investors a few tips on how to find – and buy – silver dollars for cheap.
Compare Prices
Always compare both premium fees and total cost when looking for new silver dollars to add to your collection. Premium fees are additional costs added onto the top of a coin’s melt value. If you calculate the melt value of your silver coin, bar, or round, subtract this value from the total cost of the product to determine how much of a premium you’re paying.
There’s another hidden fee that you should consider when answering our key question: are silver dollars a good investment? Some companies charge outrageous shipping fees to collectors to have their coins delivered. Make sure to factor shipping costs into your calculation when comparing silver dollar prices across dealers.
Consider Common Silver Dollars
We’d all love to be able to buy extremely valuable, rare silver dollars. But if you’re stacking on a budget, your goal should be to cut down on unnecessary premiums wherever you can. Believe it or not, some silver stackers built massive collections of pure silver using silver dollars.
To do this, they likely looked for silver dollars that aren’t particularly rare. Common silver dollars may sell for very little over their melt value, making them a great budget buy. Are silver dollars a good investment? If you’re able to find cheap silver dollars, these coins can help you build your silver stack without breaking the bank.
Final Thoughts: Are Silver Dollars a Good Investment?
So are silver dollars a good investment? Silver dollars are a great investment, as long as you’ve done your research and know what you’re buying. While silver dollars offer a lower purity compared to modern coins, they make up for it with an impressive history of investor demand and numismatic value.
Hero Bullion sells a wide range of rare silver dollars to help you build your collection.
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About The Author
Michael Roets
Michael Roets is a writer and journalist for Hero Bullion. His work explores precious metals news, guides, and commentary.