Understanding the pros and cons of offshore bullion storage is not a straightforward task, as a con for one person might not mean anything to another. This is an industry that offers a great deal of variety, and one that needs to be fully understood before you can draw your own list of pros and cons and come to your own conclusion.
In this article we aim to help you do just that, approaching the main areas of offshore bullion storage, and ones that can be either a pro or a con.
One of the issues with offshore bullion storage is that it can cost you a great deal of money to ship your precious metals to the vault. You will also want to add some insurance to make sure that your shipment gets there and that you are covered if it does not. In all honesty, if this is the method that you need to take, then we would recommend a different approach. If you have hundreds of thousands of dollars worth of precious metals then it might be okay, otherwise it is not cost effective.
However, if you choose wisely, finding a storage facility that lets you purchase gold/silver and move it straight to their vault, then this is a huge plus and something we would definitely recommend.
Do your sums
You have probably already tested your mathematic skills when purchasing gold, discovering how close to spot it was and if you were getting a good deal. Be prepared to test them again though, because you need to know whether or not it is economically viable for you to pay a monthly fee for someone to sit on your gold.
Typically, this is a huge pro for someone with a large stack, as a small monthly fee is unlikely to have an impact and the benefits that storage brings far outweighs that fee. For someone with a small stack, however, it is a big negative, as a few years down the line they could end up paying twice as much for that gold or silver in storage fees alone.
If you are considering not going with the option of bullion storage, then you might want to reconsider, especially if you have a large stack of gold or silver bullion. You might be able to insure your stack against theft or fire, which are thousands of times more common in a home than they are in a high-tech vault, but even if you do find such insurance then it is likely to cost you more than the monthly fees for bullion storage would. You should also bear in mind that most bullion storage companies will insure you, so not only is there a minimal chance of anything happening, but even if it does then you’re covered.
If you take your chances and don’t opt for expensive insurance, then you really are tossing a coin on the future of your stack. You would never store thousands of dollars of cash in your home, so why would you store the same worth in bullion? Word has a way of getting out, and if you tell anyone, from friends to family and neighbours, then they might tell another and another. Before you know it all of the criminals in your area know that you are sitting on a stockpile of precious metals and they also know where you live.
In the event of a burglary or home invasion then even a secure home safe will not save you and may do more harm, as thieves may stop at nothing to get at your fortune.