Should You Buy Pre-1933 U.S. Gold Coins?

 

Should You Buy Pre-1933 U.S. Gold Coins?

Buying pre-1933 gold coins is an excellent way to invest in numismatically valuable gold coins. Pre ’33 gold coins refer to coins minted before 1933, the year that U.S. President Franklin D. Roosevelt ended the gold standard. 1932 was the last year that the U.S. government minted gold coins for circulation, marking a turning point in the American monetary system.

For collectors, pre-1933 gold coins represent some of the finest works of American coinage. Circulated U.S. gold coins introduced Americans to some of the most attractive artwork in American coinage history, and many of the designs found on pre-1933 gold coins are still used on modern gold bullion coins today.

While pre-1933 gold coins can help investors inject numismatic value and historically relevant pieces of art into their coin collections, investing in pre-1933 gold also introduces several challenges for both new and experienced investors. Because pre-1933 gold coins are numismatically valuable, factors like condition, strike quality, and mint mark can impact their value.

Should you buy pre-1933 U.S. gold coins? Buying pre-1933 U.S. gold coins can help you diversify your precious metals portfolio, but investors should understand what makes these coins valuable – and how to avoid overpaying for them.

On this page, learn more about the pros and cons of investing in pre-1933 U.S. gold coins. 

What Are Pre-1933 U.S. Gold Coins?

Until 1932, the U.S. Mint regularly produced gold coins for circulation. This practice ended in 1933, when the Roosevelt administration suspended the gold standard. Executive Order 6102, signed in 1933, prohibited private gold ownership and led the U.S. Mint to melt the gold coins it had already minted that year.

Today, the gold coins produced for circulation in the United States are commonly called pre-1933 gold coins. As the name suggests, pre-1933 gold coins are coins that were minted in 1932 or earlier. Only one 1933-dated gold coin, a single specimen of the 1933 Saint Gaudens Gold Double Eagle, is considered legal to privately own.

Like other numismatic coins, pre-1933 U.S. gold coins trade based on their melt value and numismatic qualities, including condition, mint mark, year, and more. As a result, these coins present investors with a unique opportunity. Collectors can inject numismatic and collectible value into their portfolios by buying pre-1933 gold coins, but they may pay higher premiums over melt value for these historical gems than they’d pay for modern gold bullion coins.

Are Pre-1933 U.S. Gold Coins a Good Investment?

Pre-1933 U.S. gold coins can be a great and rewarding investment, but investors should know what they’re getting into before buying their first gold standard-era U.S. gold coins. Numismatic gold coins can help investors diversify their portfolios with historically significant pieces of American coinage while celebrating vintage U.S. artwork and enjoying the higher price ceilings that pre-1933 gold offers. On the flip side, buying pre-1933 gold coins comes with a steep learning curve, high premiums, and potential liquidity issues.

Below, we’ll take a closer look at the advantages and disadvantages of buying and selling pre-1933 U.S. gold coins.

Advantages of Buying Pre-1933 U.S. Gold Coins

Investing in pre-1933 U.S. gold can be a rewarding experience for investors who take the time to learn more about this market. 

Some of the biggest advantages of adding pre-1933 U.S. gold coins to your portfolio include:

• Numismatic value and portfolio diversification.
• Historical significance.
• Vintage art and style.
• Higher price ceilings.

All totaled, pre-1933 U.S. gold coins can help investors diversify their portfolios while celebrating some of the most artful coins to ever come out of the U.S. Mint. Let’s dive into some of the major advantages of adding pre-1933 U.S. gold coins to your collection.

Numismatic Value and Portfolio Diversification

Perhaps the biggest advantage of investing in pre-1933 U.S. gold coins is that these coins can help you diversify your portfolio. Pre-1933 gold coins often have numismatic value, which means that they’re valued for more than just the gold they’re minted with.

Pre-1933 gold coins are almost always more valuable than the gold they contain. Numismatic gold coins are valued based on several factors, including their grade (condition), the year they were minted, the popularity of the series, the coin’s historical significance, and its mint mark.

Diversifying your portfolio with numismatically valuable gold coins can help your collection retain value, even when the spot price of gold retreats. 

Historical Significance

Pre-1933 U.S. gold coins are also historically significant. These coins come from an era of American history when gold coins were minted for general circulation and the United States dollar was backed by actual gold. Those days are gone; the U.S. now uses a free-floating fiat currency that is not pegged to any one physical asset. 

More importantly for American coin collectors, pre-1933 U.S. gold coins provided the backdrop for many iconic works of coinage art, some of which are still used today. Augustus Saint-Gaudens’ artwork on the Double Eagle’s obverse appears today on the American Gold Eagle. Many of today’s most popular coins had their genesis in gold standard America, making these coins a real treat for fans of U.S. and coinage history.

Vintage Art and Style

While many investors love the look of modern gold coins like the American Gold Eagle, many numismatists consider the period between 1800 and 1933 a golden age for American coinage. Gold and silver coins from this era were penned by some of the most prominent artists of their time, resulting in unique and inventive designs.

The vintage art and style of pre-1933 U.S. gold coins make them a fantastic investment for collectors who appreciate the older artwork of American coinage, and these coins can make great conversation pieces for history buffs.

Higher Price Ceilings

For investors who want to put their money into the highest-quality coins, pre-1933 gold coins offer a virtually nonexistent price ceiling. In other words, collectors can grab a fractional pre-1933 gold coin from a common date for cheap, or they can spend hundreds of thousands of dollars for key dates in excellent condition.

The price diversity offered by pre-1933 gold coins is a great asset for investors of all budgets. No matter how much money you’re looking to spend, there’s a pre-1933 U.S. gold coin out there for you!

Disadvantages of Buying Pre-1933 Gold Coins

Buying pre-1933 gold coins also comes with numerous drawbacks, especially if you’re a new or inexperienced collector. Investors can help to save themselves time and money by becoming more familiar with how numismatic gold coins are valued and traded, since numismatic coins are valued for different reasons than modern bullion coins.

Some of the notable downsides of investing in pre-1933 gold coins include:

• A steep learning curve.
• High premiums (sometimes).
• Liquidity and buy-sell spread obstacles.

Below, we’ll take a closer look at the three main disadvantages of buying pre-1933 U.S. gold coins.

Steep Learning Curve

Buying pre-1933 U.S. gold coins comes with a pretty steep learning curve, because these coins are valued for more than just their gold content. Some pre-1933 gold coins from common dates may sell for close to melt value, but many other coins sell for sizable premiums over spot price. 

A pre-1933 U.S. gold coin’s value hinges on a number of factors, including:

• Melt value.
• Grade (condition).
• Date and mint mark.
• Errors (if any).

Two U.S. gold coins from the same year and mint can have radically different values, especially if they’re graded differently or one features a rare mint-made error or unique variety. As a result, pre-1933 U.S. gold coins can be tricky to price, which spells trouble for buyers who aren’t familiar with what makes these historic coins valuable. 

To deal with the learning curve of buying pre-1933 U.S. gold coins, we recommend that investors familiarize themselves with basic grading standards and common auction results for coins in their favorite series. The condition of a circulating gold coin is often the single biggest factor in its overall value, so learning at least a little bit about how your favorite gold coins are graded can help you make better deals.

High Premiums

Pre-1933 U.S. gold coins often sell at higher premiums compared to modern gold bullion coins. Unlike today’s gold coins, pre-1933 coins are never being minted again. This means that they trade at relatively high premiums over melt value, especially if you’re buying high-quality pre-1933 gold coins in excellent condition.

To complicate matters more, investors may have trouble recouping the premiums they pay for pre-1933 gold coins when they go to sell. 

Liquidity and Buy-Sell Spread Obstacles

Buying pre-1933 U.S. gold presents a major liquidity challenge, especially for investors who are unfamiliar with how the market works. Modern gold coins like the Canadian Gold Maple Leaf usually sell for close to melt value, making it easy to buy and sell the coin without taking a major loss. 

But with pre-1933 U.S. coins, the subjectivity of the numismatic collectibles market means that it’s often hard to sell coins for the same price you bought them for. Understanding the market and shopping around for deals can help you mitigate your risk exposure, but coin dealers will almost always underbid for raw, ungraded pre-1933 U.S. gold coins.

If you want to begin trading pre-1933 U.S. gold coins, your best bet is to familiarize yourself with each popular coin’s estimated value in multiple grades. This, paired with a basic understanding of how coins in each series are graded, can help you strike better deals and minimize your chances of having trouble finding a buyer when you decide to sell.

Buying Pre-1933 U.S. Gold Coins

You can buy pre-1933 U.S. gold coins from online precious metal dealers like Hero Bullion. Take advantage of industry-leading pricing, fast shipping, and free shipping on qualifying orders when you buy pre-1933 U.S. gold coins from Hero Bullion.

It’s also possible to buy pre-1933 U.S. gold coins from bullion dealers near you. As always, we recommend comparing prices across multiple dealers to maximize your savings before you buy your next gold coin.

Final Thoughts: Should You Buy Pre-1933 U.S. Gold Coins?

Pre-1933 U.S. gold refers to gold coins minted prior to the end of the American gold standard in 1933. These gold coins offer historical significance, numismatic value, and excellent value diversity to collectors. On the other hand, buying pre-1933 U.S. gold comes with a few notable challenges, including a steep learning curve, high premiums over melt value, and liquidity concerns.

So, should you buy pre-1933 U.S. gold coins? Absolutely – but be sure to do your research first!

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