So many people have so many hopes and dreams that sadly remain just that: only “hopes” and “dreams”, and never their reality. Why is this??? I believe that many are simply afraid to take action– either they don’t know how, or they are afraid they will do it “wrong” or make a mistake.
So today I wanted to share with you a personal story about how I totally did it “wrong” but am so glad that I did in the hope that it will inspire you to get off your butt and do something, too!
Let me share with you how I first started buying physical silver. Back in 2008, when the bottom dropped out of the stock market, I had been reading about silver for a little while and was ready to take the plunge, even though my husband thought I was nuts. When the stock market tanked, it also took the metals markets with it as people frantically liquidated whatever they had that was profitable to avoid margin calls (and for many other reasons, I’m sure), and silver tanked tremendously so I figured it must be a decent time to buy.
Anyway, I googled “buy silver” or something equally brilliant (hah) and found a few companies online who sold it, and I ended up buying it from Monex.com (more on that in a moment!). I bought a 1000-oz. bar for $11,170.12 (which of course included a 1.75% “transaction fee” and a $54 / year “service fee”, not to mention the dealer “premium” which I cannot recall but I’m sure was well over the industry standard, even for just a bullion BAR, not coins!).
Now, I did several things “wrong” here, that are now totally embarrassing. First, I didn’t know anyone who had actually ever *bought* any bullion themselves and had no recommendations from any professionals or friends on where or how to buy it so I literally just Googled and picked a place. As it turned out, Monex.com advertised on TV (which would have been a deal-breaker for me but I didn’t know that at the time!) and also (I found out later) was rated an “F” by the Better Business Bureau! Yes, you read that right…not a “C” or “D” or “B-“…..a full-out “F”! Terrific.
Apparently they mainly get the poor ranking from their pushy salespeople, but I got lucky as I am pretty immune to those tactics and just said “No, no, and no” to any and all offers of their Monex “Atlas” account, etc. However, I’m sure I paid through the nose for my bullion bar (and storage and fees) whereas I could have done much better elsewhere! (Note: I just checked the BBB site and apparently Monex has resolved a lot of their complaints and has even earned “BBB Accreditation”, but I would still be cautious as they have had 70 complaints in the past three years alone).
But even though I totally screwed up in the actual buying itself and would do it much differently if I were buying today, I am still so glad that I took action! I made money– I sold it just a few months later for $15,033, or a 35% gain in just over 7 months.
And almost more important, in addition to my 35% profit, my financial education from that one purchase increased 100X. It’s amazing what a little “skin in the game” will do for your financial education! During those seven months, I became a real silver expert. I knew the spot price of silver almost by the hour, discovered all of these well-known silver analysts and developed a list of respected dealers whom I could purchase from in the future, found a reputable local coin shop and purchased silver eagles, and more… I could go on and on about what I learned from just that ONE little step of action!
Now, three years later, as silver hit a high of almost $50 this year (it has now dropped back down to around $30 or so per ounce with the Eurozone crisis), I am so thankful I took that first step three years ago. I am a much more knowledgeable metals investor, and a much better investor in general. Just using silver as an example, I now:
- Have a solid list of reputable and respected silver dealers whom I can rely on,
- Know the typical premiums charged on all sorts of silver coins,
- Know the pros and cons of buying physical silver versus an ETF like the SLV or leveraged ETF’s like ACQ
- Know the pros and cons of taking delivery versus paying for storage for silver
- Know how to add physical silver to a retirement account
- Know the tax implications for silver, whether held for less than one year or more
- Have made a lot of new friends who also invest in precious metals!
- …probably many more that I am forgetting
So please, for me, take a little action and watch your learning (and your earnings!) explode!
What action are you going to take today? Let me know in the comments below!
To your financial success,
— Kung Fu Girl