Should You Invest in Silver Bars or Coins?

The two most popular ways to invest in physical silver is buying silver coins and silver bars. For many new investors, the choice between the two can be a tricky one to make. What are the differences between the two and which is best for your particular situation?

In this guide, we’ll tell you everything you need to know about silver bars and coins, including the pros and cons of each and key differences between the two. With this information, you can make the best investment decision for your budget, strategy, and priorities.

What are silver coins?

Silver coins are round pieces of silver minted by national governments, usually made from .999 or .9999 fine silver. While many silver bullion coins carry a face value that makes them legal tender, their true worth lies in the silver content, which is significantly higher than the nominal value. For example, a 1 oz Silver Britannia coin has a face value of £2, but its market value - driven by silver content - is considerably more, around £24.57 at the time of writing.

Silver coins are known for their intricate designs which can feature everything from national symbols, like the Australian Silver Kangaroo, to historical figures like the Silver Krugerrand, or cultural icons, like the Silver Vienna Philharmonic. These designs add aesthetic appeal that makes silver coins more attractive to certain investors and collectors. You can buy silver coins in a range of different sizes, from 1/10 oz to 1 kilogram.

Pros and cons of silver coins

As with any investment, buying silver coins comes with various advantages and disadvantages.

The pros of investing in silver coins include:

• Wide recognition: Silver coins are globally recognized and easily traded, making them easy to buy or sell.
• Government-backed: Most silver coins are minted by national governments, providing a guarantee of their weight and purity. This adds a layer of trust not found in other silver investments.
• Collectible value: Some coins carry additional value due to limited mintages, intricate designs, or historical significance, which can potentially increase their value over time beyond the silver content.
• Smaller denominations: Silver coins are available in smaller sizes, making them more affordable, liquid, and ideal for incremental purchases.

Read More: What are the Top Silver Coins for Investment?

The cons of investing in silver coins include:

• Higher premiums: Silver coins generally carry higher premiums over the spot price, making them less cost-effective for larger purchases.
• Speculative collectible value: While some silver coins carry collectible value, this is generally speculative and unpredictable.
• Risk of counterfeit: Silver coins are more susceptible to counterfeiting. This isn’t the case with all silver coins, however. For example, all Silver Maple Leafs dated 2015 and later include Bullion DNA technology which offers reliable authentication in seconds.

What are silver bars?

Silver bars are solid blocks of high-purity silver manufactured by both government mints and private refineries. Like coins, they’re usually made from .999 or .9999 fine silver and come in various sizes, from 1 oz silver bars to 1 kilo silver bars.

Unlike silver coins, which often feature detailed designs, silver bars are mostly valued for their precious metal content. They can be either cast or minted and are stamped with key details, like weight, purity, and the mint or refinery’s name for easy authentication. Because of their simpler manufacturing process, silver bars generally carry lower premiums over the spot price of silver, making them more cost-effective for bulk silver purchases.

Pros and cons of silver bars

Let’s explore the pros and cons of silver bars to see how they compare to silver coins.

The pros of investing in silver bars include:

• Lower premiums: Silver bars have lower premiums over the spot price of silver compared to silver coins, making them a more affordable option for buying silver in bulk.
• Larger sizes: Silver bars are available in larger sizes, allowing you to buy significant amounts with fewer transactions compared to coins.
• Easy authentication: Silver bars are widely recognized and easy to authenticate because they’re stamped with the weight, purity, and mint or refinery’s name.

The cons of investing in silver bars include:

• Limited collectibility: Unlike coins, silver bars lack aesthetic or historical appeal and are valued purely for their silver content.
• Less recognition: Although silver bars are widely traded, they don't carry the same level of recognition or trust as government-minted coins. This can sometimes make them harder to sell in certain markets.
• Not government-backed: Most silver bars are produced by private refineries, so they don’t carry the same government-backed quality assurance that many silver coins have.

Silver coins vs silver bars

By now, you should have a solid grasp of the basics between silver coins and bars. Let’s dig deeper and see how these two types of silver bullion investments stack up against each other in different categories.

Investment potential

At the end of the day, your goal is to invest in silver and watch that investment grow. So, how do silver coins and bars compare when it comes to turning a profit?

Silver coins

Silver coins are a hit with investors for a reason, they’re highly liquid and always in demand. Popular coins, like the Silver American Eagle and Silver Maple Leaf, are especially sought-after and can easily be sold back to precious metals dealers at competitive buyback prices.

For beginners, silver coins are a great way to dip your toes into investing. Their smaller denominations make it easy to start small and slowly grow your collection over time. That said, keep in mind that higher premiums attached to coins can slightly chip away at your overall returns compared to silver bars.

Silver bars

If you’re looking to go big, silver bars are your best bet. Perfect for those planning to invest $10,000 or more, silver bars are the most cost-effective way to maximize your silver investment. Their simple design and lower production costs means you’ll be paying lower premiums per ounce compared to coins. Plus, silver bars tend to be purer since they’re not alloyed with other metals like some coins.

That said, be prepared to put down more upfront capital. To make the most of silver bars, you’ll generally need a larger investment, making them less accessible for investors with smaller budgets.

Storage considerations

Whether you're investing in silver or other precious metals, storage is crucial to protecting your investment. Let's take a look at silver bars vs silver coins through the lens of storage considerations.

Silver coins

Most investors choose to store their silver coins at home or in a secure location, like a bank’s safe deposit box. Generally, coins are compact and easy to store, especially if you use specialized coin boxes. These boxes are specially designed to safely stack and hold the most popular 1 oz coins. For example, the 40 x 1 oz Kookaburra Silver Coin Box contains 40 slots that are the perfect size to nearly hold 1 oz Kookaburra Silver Coins.

See: Why Do Silver Coins Tarnish and How to Clean Them

Silver bars

Thanks to their rectangular shape, silver bars are easy to stack and store efficiently. But given their higher value, it’s always best to store large silver bars in professional storage, whether that’s a high-security vault or a bank’s safety deposit box. While this adds an extra layer of protection, it does come with storage fees and can limit your direct access to your silver. Plus, retrieving silver bars from storage often requires complex authenticity checks, which can be a hassle.

Market popularity

Market popularity can influence how easy it is to sell your silver when the time comes. Let’s see how silver coins and bars fare when it comes to market demand.

Silver coins

Silver coins offer high liquidity, easy storage, and a wide variety of options, making them more popular in the world of retail precious metals investing. Best-selling coins, like the Silver Maple Leaf or Silver Krugerrand, have annual mintage levels in the millions, proving they’re always in demand. When it’s time to sell, most precious metals dealers will buy coins back at a reasonable price.

Silver bars

While silver bars are a staple for large-scale investments, they’re generally less popular in the retail market. Bars smaller than 10 oz often have lower mintages and larger silver bars can be less appealing due to their lack of divisibility. If you’re focused on large-scale silver investments, bars are the way to go, but they might not be as easy to sell later on as coins.

Keep Reading: Why You Should Consider Silver Investment

Tax considerations

Tax implications are another important factor for investors choosing between silver bars and coins. Let’s take a look at the tax considerations when buying silver products.

Silver coins

Legal tender coins with a face value often have tax advantages. For example, Silver Tudor Beasts Coins from The Royal Mint are capital gains tax (CGT) exempt in the UK. This means profits made when selling these coins are tax-free.

Silver bars

Silver bars made by sovereign mints don’t generally carry a face value. This means that selling them could incur taxes on profits, depending on your local tax laws. If taxes are a big concern (usually the case with larger purchases) you might want to lean towards coins.

Divisibility

Divisibility is important if you plan to gradually build your silver investment portfolio or need to sell small amounts.

Silver coins

Silver coins are available in fractional sizes as small as 1/10 oz. This flexibility makes it easy to buy and sell in smaller increments as needed.

Silver bars

While you can purchase 1 gram silver bars, they’re less commonly traded and don’t offer the same cost-efficiency as buying larger bars. If divisibility is important to you, coins might be the better choice.

Summary: Silver coins vs silver bars

	SILVER COINS	SILVER BARS
PREMIUMS	Higher premiums over the silver spot price	Lower premiums per ounce, especially for larger bars
LIQUIDITY	Highly liquid, easy to buy, sell, and trade all over the world	Also liquid, but slightly less so for larger bars
STORAGE CONSIDERATIONS	Can be stored at home, in safes, or safety deposit boxes. Easier to store due to smaller size, and lower value per coin spreads risk	Larger bars require professional storage, which can incur additional costs.
MARKET POPULARITY	Highly popular in retail market	Less popular in retail market
TAX & LEGAL CONSIDERATIONS	Legal tender coins are usually tax exempt in the country of issue.	Selling non-legal tender bars can incur taxes.
EASE OF VERIFICATION	Easy to verify authenticity	Easy to verify authenticity
DIVISIBILITY	Easily divisible, can be bought and sold in small portions	Less divisible, better for bulk purchases
BEST FOR	Small to medium investments	Large-scale silver purchases

Should you invest in silver bars or coins?

Ultimately, if you’re new to investing or prefer to purchase silver in smaller quantities, silver coins are your best bet. They offer excellent value, easy liquidity, strong market demand, potential tax exemptions on legal tender coins in certain jurisdictions, and convenient storage with coin boxes.

If you’re ready to make a larger investment, silver bars are the way to go. These allow you to access higher purity silver with lower premiums per ounce, ensuring you get the most amount of silver for your money.

Whether you’ve decided on silver bars or silver coins, StoneX Bullion has a wide collection of high-quality silver bullion from the world’s most trusted mints. Explore our selection and start building your silver investment portfolio today.