You can save money by resisting the temptation to swipe your credit card on large transactions.
Credit card companies charge vendors around 3%. This is how credit card companies earn money, which is the money they use to give their customers points whenever they use their card. Many customers prefer to use their credit card to earn the points— however, this is shortsighted, since many people don’t realize the points are actually coming from the credit card fees they are paying. Companies are not allowed to charge any more than this percentage for credit card transactions. To make up for this fee, vendors mark their prices up an extra 3-4%. This fee may be insignificant when you’re buying a latte but when you’re buying high-ticket items such as precious metals, that percentage can increase your total cost significantly.
People use credit cards because they’re fast, easy and convenient. If you’re buying an ounce of silver as a small gift, for example, credit card fees won’t be a big deal. In some cases, a credit card payment may even be ideal. If you see that gold prices are low and you want to purchase at that price, using a credit card allows you to take advantage of that price and process the payment immediately. Using a credit card for smaller purchases is innocuous but it should be noted that purchases of less than $1,000 are taxed.
Paying thousands extra on large purchases due to credit card fees is unwise and unnecessary. You don’t want to be paying for your gold or silver as well as the transaction.
The best option is to send a bank wire or check to pay for large quantities of gold and silver.
At Bullion Trading LLC, we offer a discount for check or wire payments to help you save on the price markup. This is the most efficient option to ensure you’re getting the best possible price. Using a credit card when you’re investing significant amounts of money in gold or silver is not recommended.
A savvy investor who intends on building a robust portfolio does not pay more than they need to. Do your best to lessen extra fees on your investments so you’re not paying for a transaction in addition to your valuables.