circulated vs cncirculated coins - investment considerationsPre-1933 US gold coins are often heralded as the pinnacle of precious metals investments. For nearly a century, these legendary coins have attracted investors looking to own a piece of American history while securing their wealth. The iconic saga surrounding these coins along with their numismatic appeal and scarcity make them formidable investment vehicles. Everyone interested in holding precious metals should understand the value and significance of pre-1933 gold coins.

What are pre-1933 gold coins?

Pre-1933 gold coins represent a distinctive class of investment-grade coins with tremendous inherent value. All US coinage minted before the infamous 1933 gold confiscation falls within this highly sought-after group of coins. The minuscule amount of coins that evaded melting during the Great Depression have achieved legendary status in investment and collecting circles. The interest surrounding pre-1933 gold coins is reflected in their increased valuations and impressive sales prices. People worldwide seek out these rare coins to add to their coin collections and investment portfolios.

The History of Pre-1933 Gold Coins

The story of pre-1933 gold coins reaches back to the dawn of the United States. In the American colonies, foreign gold coins were the currency of choice before domestic minting began. The Portuguese Johannes and the Spanish Pistole were two of the most popular gold coins during this period both of which eventually inspired American gold coins.

The Coinage Act of 1792 established the United States Mint and launched the first branch in Philadelphia. For the first few years, the production of gold coins was slow as silver and copper coins took precedence. Production of pre-1933 gold coins officially kicked off in 1795 with three gold coins: a $10 Eagle, a $5 half-eagle, and a $2.5 quarter-eagle.

The widespread availability of gold during the California Gold Rush prompted Congress to issue the minting of two new gold coins with the Coinage Act of 1849. The $20 Double Eagle was a continuation of the Eagle series and immediately became the largest gold coin. The Gold Dollar, despite being planned for years prior, failed to gain much circulation after its release.

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One of the more peculiar pre-1933 gold coins came in the form of a three-dollar piece following the Coinage Act of 1853. This gold coin was primarily minted to make it easier to purchase stamps in bulk. The coin’s design broke the mold set by the Eagle series by revamping Lady Liberty and replacing the characteristic eagle with a simple wreath and the number “3”.

The $4 Stella is another oddity in the history of pre-1933 gold coins which was designed for international use within the Latin Monetary Union (LMU) – a short-lived cross-border financial system in the 19th century that the US never officially joined. It’s worth noting the Stella gold coin only had a purity of 85.7%.

In the beginning, the face value of American gold coins matched their gold value. For example, a Double Eagle in 1849 had a nominal value of $20, and its 96.75% gold contents were worth $20. Decades of astronomical inflation irrevocably severed this connection as pre-1933 gold coins are now worth exceedingly more than their face values which remain unchanged.

Nearly all of these gold coins experienced various design changes throughout their minting periods. The treasured sculptor Augustus Saint-Gaudens has become synonymous with the beautification of American gold coinage – most notably with the Saint-Gauden’s Double Eagle which bears his name.

Gold coinage gradually gained popularity in the US until it became the official backing of the country’s monetary system with the Gold Standard Act of 1900. The legislation fixed gold prices at $20.67 per troy ounce and set strict purity requirements of 90% gold. Unfortunately, the looming Great Depression would stifle the blossoming of US gold coinage.

In 1933, President Franklin D. Roosevelt signed the controversial Gold Confiscation Act which required the American public to hand over their gold holdings. The overwhelming majority of pre-1933 gold coins were taken out of circulation, bank vaults, and private storage to be melted down to give the government more gold storage for ramp-up money printing.

The importance of pre-1933 gold coins didn’t cease after confiscation. Arguably, these famed coins are even more influential today as investment vehicles than they were as circulating coinage. Owing to their rich history, gold content, and scarcity, pre-1933 gold coins are highly sought after by investors and collectors alike.

Types of Pre-1933 Gold Coins

$10 Gold Eagles

  • Draped Bust Gold Eagles (1795-1804)
  • Capped Bust Gold Eagles (1807-1834)
  • Classic Head Gold Eagles (1834-1839)
  • Liberty Head Gold Eagles (1839-1907)

$5 Half Eagles

  • Capped Bust Gold Half Eagles (1795-1807)
  • Classic Head Gold Half Eagles (1829-1834)
  • Liberty Head Gold Half Eagles (1838-1907)
  • Indian Head Gold Half Eagles (1908-1929)

$2.50 Quarter Eagles

  • Capped Bust Gold Quarter Eagles (1796-1807)
  • Classic Head Gold Quarter Eagles (1834-1839)
  • Liberty Head Gold Quarter Eagles (1840-1907)
  • Indian Head Gold Quarter Eagles (1908-1929)

$1 Gold Dollars

  • Liberty Head Gold Dollars (1849-1854, 1856-1889)
  • Indian Princess Gold Dollars (1854-1856)

$3 Gold Pieces

  • Indian Princess Gold Three Dollars (1854-1889)

$20 Double Eagles

  • Liberty Head Gold Double Eagles (1849-1907)
  • Saint-Gaudens Double Eagles (1907-1933)

Miscellaneous

  • Four Dollar Gold Stella (1879-1880)

Why Buy Pre-1933 Gold Coins

Historical Significance

When you purchase a pre-1933 gold coin, you’re investing in a tangible piece of American history. These remarkable coins circulated during key events including the California Gold Rush, the Civil War, the Great Depression, and WWI. These connections to the past imbue pre-1933 gold coins with an inestimable value that makes them highly sought-after investments decades later.

Scarcity

Pre-1933 gold coins are quintessential rare coins. They’re notoriously scarce as only a small percentage escaped the government’s wholesale gold confiscation and even fewer survive today. This severely restricted supply results in exceptionally high demand and, as a result, impressive valuations. This rarity will only increase over time as coins become lost or damaged which makes pre-1933 coinage great long-term assets.

No Reporting Requirements

Greater privacy is a unique advantage offered by pre-1933 gold coins. As numismatic assets, these coins don’t require investors to report the investment to the government. On the other hand, investors have to submit 1099 forms and divulge their social security numbers to purchase bullion coins or bars.

High Purity

Thanks to the U.S. Mint’s strict purity standards, most pre-1933 gold coins boast a minimum fineness of 90%. Some coinage, such as the Saint-Gaudens Double Eagles, even reaches 91.67% of gold purity. High concentrations of gold translate to respectable inherent value which makes these coins worthwhile precious metals investments.

Inflation Hedge

Overall, physical gold assets are a dependable hedge against inflation as prices tend to rise when the rest of the economy stumbles. This is especially true for rare coins such as pre-1933 gold coins. Their inherent value derived from historical significance, numismatic appeal, and scarcity keep these coins from being affected by poor economic conditions.

Profit Potential

Beyond mere inflation hedges, pre-1933 gold coins have proven to yield considerable returns for investors. Due to their high numismatic value and historical appeal, these distinguished coins become more sought after over time. Generally, the longer you hold one of these coins, the higher their appreciation and the more profitable your gains.

Are pre-1933 gold coins a good investment?

Pre-1933 gold coins represent some of the finest precious metals investment vehicles. An indelible historical significance, high purity ratings, remarkable scarcity, and overall numismatic appeal equip these coins with superb inherent value. Ever since the massive gold confiscation of 1933, these coins have proven to offer protection against economic pressures along with impressive gains.

However, determining if pre-1933 gold coins are right for you requires a professional assessment of your specific investment circumstances. You can get in touch with a dedicated Precious Metals Advisor at SBC Gold by calling toll-free at 1-888-812-9892 or using our live chat function. One of our experts will be happy to discuss the merits of pre-1933 coins based on your specific investment objectives.