• nate@nateplissken.com
Acres of Gold, a new way to buy gold.

Acres of Gold, a new way to buy gold.

Are you asking yourself: “What is Acres of Gold and is there really a new way to buy gold?”. The short answer is yes but with a caveat; just because something is new doesn’t make it better. But with due diligence, you can compare the pros and cons of buying gold the new and old ways. And consider your circumstances to find out which is better for you.

The old way to buy gold.

Your first way is to go to a local precious metals dealer in person and buy gold at the spot price plus the premium the dealer sets. You would walk out of the store with your physical gold, end of transaction. Secondly, go online and buy the gold from a reputable dealer; again your purchase is based on the spot price and the dealer premium.

What is the dealer premium on gold?

Have you ever noticed that the spot may be a certain price but when you go to buy gold in person or online the price is more than the spot and it varies? Each dealer chooses their own premiums that they charge their customers based on their business model and the type of gold coin or bullion they sell.

Premium prices on gold vary from volume.

Often they will charge a higher premium per ounce of gold when a customer buys fractional ounces of gold. This means that the spot price of gold could be $1900.00 but the dealer charges $80 in premiums for the one oz coin making it cost $1980. Likewise, the same dealer may charge a $100 premium per oz. for a ½ oz gold coin causing the gold coin or bullion to cost $950.00 for the ½ oz of gold and $50 in premium causing the ½ coin to cost $1000.00. Dealers can each set their own premiums but it is up to the market to decide if it’s worth it. 

Note: There is an actual expense that gold mints incur when they mint coins. When minting smaller coins they have to mint more coins per oz and there are some cost increases for the mint.

Premium prices for each type of coin and bullion vary.

The same dealer may charge a higher premium for  1 oz Gold Eagle and a completely different price for a Canadian Maple Leaf coin or South African Krugerrand, even though the amount of gold and quality is the same.

Acres of Gold, a new way of buying gold.

I came across a company called Acres of Gold. Acres of Gold’s new buying strategy for acquiring is a monthly automated membership. You sign up with a one-time membership fee of $12 and then you make an automatic monthly set payment plan on physical gold in the quantity of either 2.5-gram bars or 5 to 10-gram bars. 

The Pros of Acres of Gold, a new way to buy gold.

Firstly, its main benefit is that you do not have a large monthly income, saving $2000 to buy one oz of gold may be intimidating. Fifty dollars a month to buy gold is a much easier proposition. If saving money is a challenge for you then this could be for you.

The Acres of Gold Concept.

Sign up on a monthly plan to have $50-$250 automatically deducted from your debit card and when you have paid in enough to purchase a 2.5-gram to 10-gram bar of gold it will automatically be shipped to you.

A very easy way to own physical gold.

Beginners looking to start stacking gold may find this a very good way to start investing in physical gold. How many times have you thought to yourself I should be buying some physical gold but never got started doing just that?

By simply committing to putting $50-$250 into buying gold every month you have taken all your excuses out of the way. All things considered, buying gold at a dollar-cost average is not a bad idea. Considering how much money the average consumer wastes every month, this is money better spent.

Cons of buying gold with Acres of Gold.

What price are you buying the gold at anyway? As mentioned in this chapter earlier, every dealer has a different premium and the spot price varies. Looking over the website I could not find a definite price that you would be purchasing your 2.5 -10 oz gold bar at. You may be paying a higher premium than usual, or not.

Force Majeure 

The dictionary defines Force Majeure as unforeseeable circumstances that prevent someone from fulfilling a contract. On their website Acres of Gold has listed a Force Majeure clause:

This is their Force Majeure clause:

“You acknowledge and understand that if Acre and/or the Website are unable to provide the products and/or services as a result of a force majeure event, Acre and/or the Website will not be in breach of any of its obligations towards you under this Agreement. A force majeure event means any event beyond the control of Acre and/or the Website. ACRE SHALL NOT HAVE ANY LIABILITY TO YOU WHETHER IN CONTRACT, WARRANTY, TORT (INCLUDING NEGLIGENCE), OR ANY OTHER FORM OF LIABILITY FOR FAILING TO PERFORM ITS OBLIGATIONS UNDER THIS AGREEMENT TO THE EXTENT THAT SUCH FAILURE IS AS A RESULT OF A FORCE MAJEURE EVENT.”

I am not an attorney but this could mean a lot of different things. What comes to my mind is what if we have hyperinflation? What if gold went up rapidly and there are shortages of gold and they choose not to fulfill their gold orders based on a Force Majeure.

Possession is 9/10ths of the law.

When you have physical gold in your hands is when you for sure own physical gold. Buying gold like this involves an extended counterparty risk that buying gold online doesn’t usually have because even though, Acres of gold is a new way to buy gold, you are gradually buying gold. Gold prices rising could mean that it will take you longer to buy gold as the prices continue to rise.

Cash is king when buying gold.

Ironically though the goal is to get out of cash and into real money, aka gold, when paying cash in full for gold you can shop around and find the lowest price per oz for gold. You can go visit Golden State Mint, online and Apmex and decide which has the best deal on gold.

Don’t step over gold to pick up pennies.

What I mean by stepping over gold to pick up pennies is that you should consider investing in gold a long-term investment. And if you are so concerned with getting the lowest price per ounce of gold and you hesitate in buying gold you may regret it.

If gold makes historic highs with inflation priced in.

If gold goes from $1900 an oz to $4000 an oz or even $10,000 an oz will you be upset that you bought it at $1999 an oz instead of $1950 an oz? No, you will only be upset that you didn’t buy more. Understandably that is a big “if” but that is how you could be stepping over gold to pick up pennies. 

Are you able to save on your own or do you need some help?

Arguably that is the only question, can you save a few hundred dollars on your own to buy fractional gold? If not then maybe you should consider setting up an automatic savings plan with Acres of Gold, to buy fractional gold.

What is Fractional Gold?

Fractional gold is considered any gold bullion, be it bars or coins or rounds that are less than 1 troy oz of gold. Most online retailers sell fractional gold. Generally, your premium per oz is higher, the smaller the fraction of gold that you buy.

My thoughts on buying Gold.

Personally, due to the threat of inflation, I want to own as much gold as I can. Be smart about buying gold but if you have to trick yourself into buying gold every month, I would say do it.  Acres of Gold a new way of buying gold because it makes it easier to buy gold on a monthly basis.

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