I’m trying to get this all figured out, it’s kind of confusing! Junk Silver, Silver Coins, Bullion Coins, Pre-1965 Coins – it turns out they all pretty much mean the same thing! Hard-Core TEOTWAWKI Preppers know that pre-1965 silver coins are made up of actual silver and have good potential barter power. That bartering capability comes from the fact that the U.S. Mint has guaranteed the amount of silver in these coins so they have a known value. Bullion Coins are generally considered the easiest way to have known values of precious metals – hence their potential barter usage. So far this is fairly common knowledge, but there is a lot more to know in order to do this properly – and I’m trying to get it all figured out.
This post is a learning post – I’m no expert in this area at all – I’m merely sharing knowledge as I gain it. The purpose here is for us to help each other out – if I’m wrong in something I say, please correct me in the comments! If you know about this area and can provide useful further info including knowledge, tips, websites, etc – please do! And if you’re just now reading this, please check the comments and consider them an extension of this post.
Now that that is out of the way, on to the discussion. I’ve been wanting to know more about this and recently have started researching it – I made my first purchase of Junk Silver at the Crossroads of the West Gunshow in Salt Lake on Saturday (Jan 11, 2009). It was a little thrilling because I really wasn’t sure if I was getting ripped off or not, but I wanted to get started on caching coins. I only bought $11.00 worth so it was a cheap, potential throw-away, experience. Turns out it wasn’t a bad deal. Let’s get into what I’ve learned about how this works.
According to Lynn Coins Junk Silver is organized into $1.00 values based on the face value of the coins. This means you can mix and match quarters, dimes, nickels, half dollars and dollars into batches. Each $1.00 face value batch of coins should have approximately 71% of a Troy Ounce of Silver in it.
The most commonly collected U.S. junk silver pieces are Mercury and Roosevelt dimes, Washington quarters, and Franklin and Kennedy half dollars, minted in or before 1964. These coins have a 90% silver composition (“coin silver“), and when minted contained 0.7234 troy ounces of silver per dollar of face value. In practice, the content is usually assumed to be 0.715 ounces because of wear. Less common as junk silver are Kennedy half dollars from 1965 to 1970, which contained 40% silver. Peace Dollars may also be collected for their silver value, but are also less common.
Canadian dimes and quarters contained 80% silver (0.600 troy ounces per dollar of face value) until 1966. In 1967, they were minted in both 80% and 50% varieties. In 1968 they either contained 50% silver, or none at all (Cupro-Nickel). Dollars and half dollars were minted in 80% silver until 1967.
From this we learn the next critical part to gathering Junk Silver – PRE-1965 coins must be used in most cases. Starting in 1965, the US quit using Silver and switched to a fiat currency.
So, as we’re gathering pre-1965 silver coins (how stinking hard is that going to be if you’re going through your pocket change?), how do we know what they’re currently worth? Coinflation.com provides us with a chart that shows the current silver value of different US coins based on their silver composition. That makes it easy. We can also look at live market rates for Silver on kitco.com – as of this writing, the Spot Price of Silver was at $11.25.
As I mentioned above, Junk Silver is not something you’re going to just find in the change you get at the gas station – at least not very often. For the most part you have to go to a coin dealer/trader in order to get accumulated quantities of Junk Silver. Here’s a quick list of Coin Dealers in Utah.
Supply and Demand of course plays a part in all this – every prepper that’s thinking about this topic is looking for Junk Silver to grab – and there’s a finite amount of them available. So, when you go to purchase your Junk Silver, keep in mind that the dealer is providing a valuable service – sorting, buying and collecting the pre-1965 Silver Coins and then providing you with a resource that has a limited quantity and a real value behind it. In other words, you’re going to pay more than the silver is worth on the market.
Here’s what I’ve learned about values in the Junk Silver Market – as of this writing, you should expect to pay about $11.00 per $1.00 face value of coins – this amounts to .7 Troy Ounces of silver – the current Spot Price of Silver is $11.25 per ounce. So, you should expect to pay about 30% or so markup on the actual spot price of silver – this is commonly referred to as the Price Over Spot.
Availability is definitely an issue right now, Junk Silver is HARD to find locally, especially in large quantities. Apparently it’s common for dealers to buy $1,000.00 face value bags of coins, but that costs a LOT of money. If you can’t find any at your local coin shop, Lynn Coin and probably several others will sell it to you in smaller bulk quantities. I’ve never dealt with them and cannot and am not recommending them. For bulk purchases, the fantastic SurvivalBlog.com recommends and endorses The Tulving Company.
BTW, the quick way to gauge the value of a $1,000 bag versus the spot price of silver on any given day is simply to multiply the spot price by 715. Thus, at yesterday’s spot silver price of $13.85 per ounce, your $1,000 bag of dimes is worth $9,902.75. (Or just think of it as 9.9 times face value.)
There are also other ways to buy silver but we aren’t going to go into that much. I will however mention that I love these LDS based 1 Troy Ounce silver coins that have a picture of Captain Moroni on the front and The Title of Liberty of the back. I won’t mention how many of them I own :)
Do you have any further insights, corrections, or good sites you can recommend about Junk Silver? If so, please let us know in the comments!