Is Constitutional Silver a Good Investment?
Constitutional silver is a good investment for collectors who want to stack silver without paying high premiums. Junk silver coins include some of the most classic and recognizable designs in American coinage history, and you can buy them for a fraction of the price you’d pay for modern bullion coins.
Still, many investors aren’t familiar with the litany of benefits associated with stacking constitutional silver coins. Hero Bullion is excited to offer a wide variety of Constitutional silver to help our customers collect beautiful silver coins while saving money on premium fees.
So is constitutional silver a good investment for you? Keep reading for a full guide to everything you need to know about buying – and selling – constitutional silver coins.
What is Constitutional Silver?
Constitutional silver refers to circulation U.S. coins made with actual silver. Silver content can vary for constitutional silver coins. Some coins feature a purity of .40, while the bulk of silver dollars minted from 1878 to 1930 feature 90% pure silver bullion.
Modern U.S. currency coins aren’t made with actual silver. While bullion coins from the U.S. Mint like the American Silver Eagle contain highly pure silver bullion, coins distributed for circulation after 1965 weren’t made with real silver.
When you buy constitutional silver, you’re buying silver coins that have already been circulated. In other words, the constitutional silver coins on the Hero Bullion website have actually made their way into the U.S. economy before being scooped up by collectors.
One popular form of constitutional silver is called junk silver. Unlike some constitutional silver coins, junk silver isn’t particularly valuable to collectors.
Is Constitutional Silver Different From Junk Silver?
Junk silver is a type of constitutional silver, but the two product categories do have a couple of key differences. Constitutional silver refers to any circulation coin from the United States minted with pure silver bullion. This includes silver dollars minted throughout early American history. These coins can be quite valuable to investors so they aren’t generally considered junk silver.
Junk silver, on the other hand, is not valuable to collectors. These coins are bought and sold almost exclusively for their silver content. That’s why many of our junk silver packages are sold at a price close to the total melt value of the coins in a given bag or package.
So what’s the difference between constitutional and junk silver? Junk silver isn’t valued for its collectability, but some constitutional silver coins can be sold for more than their melt value because of numismatic reasons.
Types of Constitutional Silver
For the purposes of our guide, we’ll split constitutional silver into two different categories. Silver quarters, dimes, and half dollars are generally considered junk constitutional silver. .90 silver dollars, however, are valued for more than their spot price in silver bullion. This makes them a distinct type of investment.
Let’s take a look at the two main categories of constitutional silver for sale on the Hero Bullion website.
Silver Quarters, Dimes, and Half Dollars
Before the passage of a law in 1965 that ended silver coinage in the U.S., the United States Mint used actual silver bullion to make their quarters, dollars, and half dollars. For the most part, these junk constitutional silver coins were minted with either .40 or .90 fine silver.
Because these coins were minted in such high numbers, they’re usually only sold for a little more than their melt value in pure silver. In a way, this is where we get the term ‘junk silver.’ On their own, these coins aren’t worth very much money – especially to collectors. The silver they contain, however, makes them valuable assets.
Investors who want to cut down on premiums and stack pure silver should consider constitutional silver quarters, dimes, and half dollars. These products offer some of the lowest premiums over spot price in the entire precious metals industry.
.90 Silver Dollars
Silver dollars are a complicated category. Some silver dollars are considered junk silver because they’re sold at a small premium over the spot price of silver. Other silver dollars are still constitutional silver but aren’t considered junk silver.
Investors who want to stack low premium silver dollars should look for common coins with low grades. These coins aren’t worth much to numismatic coin collectors, which means you’re likely to pay very little more than their melt value to get your hands on them.
Is it possible to stack rare constitutional silver coins? Absolutely! Some of the rarest silver dollars in history have sold for millions of dollars. Even some of the more common silver dollars on the market could be worth thousands, depending on their rarity, mint mark, and condition.
The wide variety of different types of junk silver coins is a major reason why constitutional silver is a good investment. In a way, the constitutional silver market has something for every investor.
Is Constitutional Silver a Good Investment?
Constitutional silver is a great investment if you want to collect affordable silver coins with beautiful, classic designs. Whether you’re a seasoned numismatic or a low budget stacker, constitutional silver has something to offer your growing precious metals portfolio.
Pros and Cons of Buying Constitutional Silver
Constitutional silver certainly isn’t a foolproof investment. In fact, there are several pros and cons to investing in constitutional silver coins. Let’s take a look at some of the advantages and disadvantages of this popular method of stacking silver below.
Pros of Investing in Constitutional Silver
We’ll start with the pros. Constitutional silver is a good investment for three main reasons: low premiums over spot price, historical and beautiful designs, and the potential for high numismatic value.
Low Premiums Over Spot Price
Junk and constitutional silver are two silver product categories known for their low premiums over spot price. Premiums are just a part of life for silver stackers. Even if you choose to buy the cheapest junk silver around, you’ll pay some sort of a premium over spot price.
However, constitutional silver coins are often worth very little more than the melt value of the silver bullion they contain. Constitutional silver is great for investors who want to start collecting silver coins without paying the high premiums associated with bullion products like the American Silver Eagle.
These low premiums are a good way to supplement your silver stack. We always recommend that investors split their money among several different silver markets. Combining junk constitutional silver coins with modern bullion coins can help you generate multiple different ways to profit from movements in the silver and numismatic markets.
Historical and Beautiful Designs
American constitutional silver is popular among stackers and collectors for a few reasons. However, one of the biggest justifications for adding constitutional silver coins to your portfolio today is the beautiful, historically important designs on many of our in-stock constitutional silver coins.
Constitutional silver coins helped to lay the groundwork for modern U.S. Mint silver coins, including the American Silver Eagle. Even Lady Liberty’s appearance on modern coins is a trend that finds its roots in classic American constitutional silver coinage.
Some investors actually prefer the classic look of our constitutional silver coins to the modern designs being made by the United States Mint.
Potential for Numismatic Value
It’s also worth mentioning that a major pro of investing in constitutional silver is the potential for numismatic value. Many constitutional silver coins are junk silver, which means that they don’t have much to offer numismatists and silver coin collectors. This is actually part of the reason why these coins are such a cheap way to invest in silver.
But for certain coins, the sky’s the limit when it comes to numismatic value appreciation. Morgan and Peace Silver Dollars are a good example of numismatically valuable constitutional silver coins. These .90 fine silver bullion coins are valuable for their silver content, but they also have a dedicated following of collectors who are happy to pay an elevated premium to collect them.
Cons of Buying Constitutional Silver
There are two main downsides to buying constitutional silver: lower purity than most modern bullion coins and a dearth of specimens in Brilliant Uncirculated (BU) condition. Let’s take a look at just a couple of the biggest cons to buying constitutional junk silver.
Low Purity Compared to Bullion Coins
Purity levels vary for constitutional silver, depending on which products you choose to buy. Some junk silver coins only contain .40 pure silver, but the bulk of older circulation silver coins from the U.S. Mint is struck with .90 fine silver bullion.
If you’re a silver purist, this could be a problem. We understand that some silver stackers prefer to build their portfolios with silver coins featuring the highest purity possible. However, many investors find that constitutional silver is an affordable way to stack silver – even considering the lower silver purities most of these coins feature.
Not in BU Condition – Mostly
Because constitutional silver was once circulated, legal tender in the United States, very few of these coins have been kept in excellent condition for the decades since their initial minting. We will say that Hero Bullion sells several constitutional silver coins and dollars in exceptional condition.
Again, most investors don’t have a huge problem with the circulated condition of many constitutional silver coins. To the contrary, some people use low condition coins to their advantage. Constitutional junk silver coins in rough shape can be purchased at a much lower premium over spot price than their near-perfect counterparts.
Ultimately, it’s up to you to decide whether or not circulated coins are a good investment for your portfolio. Circulated constitutional silver coins are a cheap way to invest in silver, but they might not look quite as good on your coin shelf as pristine, BU American Silver Eagles.
How to Buy Cheap Constitutional Silver
Most constitutional silver investors are either collectors or stackers. No matter which type of investor you are, your goal should always be to get the best price possible when shopping for silver bullion coins, bars, and rounds.
To buy cheap constitutional silver coins, you’ll need to compare prices across multiple dealers and decide on a specific type of constitutional silver.
Compare Prices From Different Dealers
If you’re a consistent Bullion Academy reader, you might almost be tired of hearing us talk about shopping around to compare prices. Still, it’s important that both new and seasoned silver stackers understand the importance of comparing prices when shopping for silver coins.
Constitutional silver premiums are generally lower than premiums for modern bullion coins, but specific prices will vary from dealer to dealer. We recommend taking care of online coin pricing guides to get a better idea of what your favorite constitutional silver coin is worth.
Take a good look at the deals being offered by leading precious metal dealers like Hero Bullion. If you wait for the right discount, you might be able to save quite a bit of money while investing in silver using constitutional silver coins.
Decide on a Type of Constitutional Silver
Like we mentioned earlier, constitutional silver comes in many different forms. Take some time to research and figure out which type of constitutional silver is best for your growing precious metal portfolio. Some constitutional silver coins are cheap to buy and offer limited collectable value.
Other constitutional silver products, such as silver dollars, are valuable to collectors as well as silver stackers. These coins are a good choice if you’re looking to diversify with some numismatically valuable silver products.
Final Thoughts: Is Constitutional Silver Right For You?
Is constitutional silver a good way to invest in silver? We certainly think so. Constitutional and junk silver coins offer some of the lowest premiums in the precious metals market, which makes them a fantastic investment if you love cheap silver.
Hero Bullion sells a wide range of competitively priced constitutional silver coins from throughout American history. Shop our full inventory, and let us help you stack with confidence!
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About The Author
Michael Roets is a writer and journalist for Hero Bullion. His work explores precious metals news, guides, and commentary.