Junk Silver Coins – Should I Invest In It?

The term “junk silver coins” refers to silver US coins minted before 1964 which were actually made up of 90% silver and 10% copper. This included dimes, quarter dollars, half dollars, and dollars as well as some special issue coins.

US minted coins are recognized around the world and known for their silver content. This makes them easy to trade on and well trusted.

Average circulated 90% silver coins are often sold in $1000.00 face value bags. A quarter bag would be $250.00, a half bag would be $500.00. At the time of this writing junk silver is available for around $24 to $25 per dollar face value when you buy a full bag. The going rate for $1 face value will vary depending upon the quantity you purchase.

90% Junk Silver Coins Bag

90% Junk Silver Coins Bag

A full $1000 face value bag  of junk silver coins will contain approximately 715 troy ounces

During 1965 through 1970 the Kennedy half dollar was made of 40% silver and 60% copper. These coins may also fall into the “junk silver” market. Naturally the price for a $1000 face value bag would be much lower than with the older 90% coins.

Junk Silver Coins Carry A Low Premium

One very good reason to opt for junk silver coins as a way to build up your silver portfolio is the price. Bags of 90% silver coins can often be obtained for a small premium above spot value. There is considered to be very little if any collectable value in the coins. Older coins, like the Barbers, will, even in lower grades, be worth more than “junk” silver. Their rarity adds value due to the collectors market which isn’t concerned so much about the silver content as they are the rarity of the coin.

90% Junk Silver Coins

90% Junk Silver Coins

For the most part junk silver coins will consist of Roosevelt Dimes, Washington Quarters and early Kennedy Half Dollars. However you may see Winged Liberty or “Mercury” Dimes and a few Ben Franklin Half Dollars. If you can get Barbers instead of Roosevelt’s for a small difference in cost it would be the best choice to go for the older coins.

One factor to keep in mind though, especially for large purchases, is the level of wear. Highly worn coins will not weigh as much and although sold by face value they will have less metal than comparable coins with minimal wear. So, you desire circulated coins but not worn out ones.

As with any other form of precious metals pay particular attention to the premium that you are paying. The premium, of course, is the marginal dollar amount above the spot value. If silver is $32.00 per ounce and you pay $49.95 for a 1 ounce round or bar then you have paid a premium in the amount of 17.95 on your ounce. For most investors that would be considered much too high.

Of course when paying a higher premium we may also take into consideration the collectable value or potential rarity of the particular coin. But the scope of this article is geared more toward junk silver, ie silver coins considered primarily for their metal content only.

Read and learn so you can make the best possible decisions about your precious metals investments!

Written by David Slone, Copyright 2013



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