As this type of question depends on on various factors like your monthly budget, how much you expect to invest in silver over the next few years, whether or not you have side income and, how big your house is, etc. you really need to think for yourself but we can offer some guidance.
The concerns range from whether you are buying silver for investing purposes, as a hedge against the dollar, to protect your wealth, or if you preparing for financial meltdown and a post-apocalyptic like society- what some call SHTF scenarios.
We believe you should consider all of the factors and balance your silver investment accordingly.
.999 Fine Silver bullion bars are a great way to own silver at little to no premium. Solid bullion silver bars of .999 fine purity are a great way to buy silver. I recommend you buy 10 oz Silver Bars that are clearly marked for purity and weight, and are from a well-known and respected mint. Never buy silver-plated bars; you only want solid .999 silver. Anything marked “100 mills” or similar is a cheap metal bar that has been plated with a minimal amount of silver. Some examples of well-known silver bar producers are Engelhard, Johnson and Matthey, Heraeus, Sunshine Mint and Apmex. Bullion bars generally carry the smallest premium of any form of physical silver, and are the choice for stackers who are trying to maximize the number of ounces they hold. In fact, 100-ounce and 1,000-ounce bars can sometimes even be bought from large wholesalers at spot price with no premium at all. However, I do not suggest buying 100 oz silver bars unless you already hold at least a thousand ounces of silver, so that you do not have more than 10% of your entire stack in any one single piece of physical silver. The market for resale and trade for such a large bar of silver will be severely limited compared to one-ounce coins or ten-ounce bars, and you do not want to be stuck trying to buy a loaf of bread or bag of rice for your family when all you hold is a 100 ounce bar of silver.
We recommend common government-minted one-ounce bullion coins because these are the most versatile and the most well known. These will be the most useful in any future scenario. These coins are internationally recognized,made of .999 fine or better silver, and do not carry ridiculous premiums. These coins do generally carry premium, but this is because the free market has determined the benefits of these coins are worth this small premium you pay. The benefit of owning government minted coins like the American Silver Eagle or the Canadian Maple Silver Leaf is that these coins are accepted world-wide as silver bullion, and you rest assured knowing that you won't have issues conducting trade globally if the need arises.
Junk silver is another great option and should be mixed in. Junk silver is an informal term for silver coins that bear no numismatic or collectible value above the bullion value of the silver it contains. In the United States, the term junk silver usually refers to US quarters, dimes, dollar and half-dollar coins minted before 1964. Buying junk silver is a great way to get more silver for your dollar as junk silver can usually be found with little to no premium. They also have the potential that certain coin years or mintages are or will become rare- and will make the coin more valuable than its silver content alone. In addition, these coins are also alloyed with copper for added durability in during transactions and circulation.
Generic 1 oz. Silver Rounds are a great choice for a lower premium on the 1 oz. denomination, which is the most versatile. These are not considered coins, because they are privately minted - not minted by governments. These are generally minted in the .999 purity. We recommend these after accumulating some government minted 1 oz. coins first. When buying 1 oz. silver rounds, make sure you are buying from reputable mints like Engelhard. This makes it easy to verify silver content and makes it easy to trade.
Generally, you want to be flexible and should have a mix of 1 oz. rounds, 1 oz. silver government-minted coins, silver bullion bars of various sizes, and junk silver to accommodate all situations. This is ideal as your holdings will have more flexibility if the time comes when you need to sell your silver or use it to buy the things you need. Occasionally, there are collectibles worth buying because you know the premium will rise. Generally though, avoid numismatic coins.
For example, if you have $2,000 to spend and plan to invest another $10,000 in silver over the next year you might do the following:
1. Purchase $1,500 worth of popular 1 oz. coins that are well known and reputable like the American Silver Eagle as they can easily serve as a means for trade if the fiat currencies collapse, but are still investment grade silver. Also, if nothing ever happens these will still maintain their collector's value as well as its 99.9% silver content that has industrial uses.
2. Purchase 500$ worth of 90% U.S. junk silver for bartering purposes. We see silver going to the price that fractional silver will have lots of use for smaller trades (which is accomplished by having nickels, dimes and quarters). People will still want to collect these in the future anyway.
3. Put the rest into 5 oz. and 10 oz. bars for investment as you pay a lower premium and now your money should be for investment and small to medium trading purposes, but each time you buy also buy some 1 oz. coins. 1 oz. coins are really the best for smaller investors and everyone should have some.
An investor with say $50,000 to $100,000 should follow the same strategy outlined above but should be buying much more 10 oz. bars to get as much silver for dollar bills because of lower premiums. 100 oz. bars should be considered but do not get too many. In this case I would say put 5-10% into junk silver; 10-25% into 1 oz. coins, 50-60% into 5 oz. and 10 oz. bars and start collecting some collectible type silver that may rise in premiums if you can get them while they are new and cheap.
As you continue to buy silver, once you already have enough of smaller denominations you may need for practical trade, spend some on storage - like a nice safe and don't forget to stock up on basic necessities to prepare for uncertain conditions - things like guns, ammo, water, and canned food, etc. After those basic needs are met, the rest of the money should go to investment grade silver that you can buy at the lowest premiums.
If you are preparing for inflationary and hyperinflationary times, all types of silver will be serve just fine except that collectors coins and coins valued for numismatic reasons will not be as valued much more than their metal content (this is of course not ALWAYS the case). As a financial crisis makes numismatics a low priority, preparation for these scenarios should focus on getting investment grade silver that the most people would likely need; 1 oz., 5 oz., and 10 oz. sizes.
For really bad situations where everything has collapsed, 1 oz. coins and occasionally up to 10 oz. and less are really the only practical sizes which makes junk 90% silver one of the better options. If you feel this is a major concern you should definitely diversify more of your silver holdings to junk silver and 1 oz. rounds, especially American Silver Eagles.
As a physical market will always exist despite crashes in the stock market and currencies, your physical silver will always retain purchasing power at coin ships and local exchanges, and online stores connecting you with people around the world.
Time is running out fast! The supply/demand fundamentals as well as inflation makes the impending rise in silver prices unavoidable. To protect your wealth & multiply wealth, physical silver is the best option.