Buying Gold Sovereigns

SilasMarner

Evening, Small issue - but I'm a bit naive on this one and I shall be grateful for advice from folk who know better. I want to buy my Grand Daughter a gold sovereign each birthday starting with a 2021 coin now....and was just going to purchase from the Royal Mint. Appreciate there is a (big?)  premium on the coin over the value of the gold - is this the best way to go please? Thanks.

ColdIron

Proof coins are not worth the premium IMO but they are nice and shiny. You can buy new uncirculated coins from other vendors with a much lower premium. These are reputable companies

https://www.chards.co.uk/
https://www.bairdmint.com/
https://atkinsonsbullion.com/
https://www.bullionbypost.co.uk/
https://www.hattongardenmetals.com/

kidmugsy

She will have no Capital Gains Tax to pay. The gift will be free of inheritance tax (IHT) if you keep your gifts below the annual exempt amount: you can gift £3k to one person and £250 to as many other people as you like.  If you make regular gifts out of surplus income (rather than capital) those avoid IHT too.  Only you know whether IHT might be an issue for you.

I like the idea: I must consider whether to do it for my granddaughter.  Where do you propose the sovs be stored?

unkle

I've bought them for a long while now (for myself as an investment), so far I just don't see any downside!

SilasMarner

Thank you for your very helpful replies. 

Coldiron    :- That's really useful - I wasn't sure whether to trust other sites. I can run a comparison now.
Unkle         :- Agreed. My thoughts exactly.
kidmugsy  :- Tax info is great reminder. Thanks. "Where will they be stored?" Brilliant! TBH I'm embarrassed to say  I hadn't made the connection between my "user name" and my post until I read your comment.  George Eliot will be turning in his....

JamesRobinson48

.  George Eliot will be turning in his....

... or her ...

Hexane

kidmugsy said:

Where do you propose the sovs be stored?

pls include postcode for convenience

Type_45

You'll buy a coin for £30.  Then if you want to sell the same coin you'll get £20....

(This relates to silver prices, but the point remains).

Nebulous2

Gold fluctuates in price quote a bit. I'd see it as a one off, rather than a yearly thing. 

As a child coin collecting was a hobby of mine. On the sale of a family business in the 70s I asked for a Krugerrand. It was around £70 then and is now worth around £1500. Storing it has been problematic, I occasionally have a panic about its location, and it has sometimes been kept by someone else, when I was a student, for instance. 

 I can't remember what my sister got, but whatever it was would be long gone and certainly wouldn't be worth £1500. 

Type_45

Nebulous2 said:

Gold fluctuates in price quote a bit. I'd see it as a one off, rather than a yearly thing. 

As a child coin collecting was a hobby of mine. On the sale of a family business in the 70s I asked for a Krugerrand. It was around £70 then and is now worth around £1500. Storing it has been problematic, I occasionally have a panic about its location, and it has sometimes been kept by someone else, when I was a student, for instance. 

 I can't remember what my sister got, but whatever it was would be long gone and certainly wouldn't be worth £1500. 

Would you actually get £1500 cash in your hand if you sold it?

QrizB

Type_45 said:

Nebulous2 said:

 On the sale of a family business in the 70s I asked for a Krugerrand. It was around £70 then and is now worth around £1500.

Would you actually get £1500 cash in your hand if you sold it?

 Going by the prices of sovereigns on the Chards site mentioned earlier they sell at ~£310-320 and buy at ~£300, so the spread is 5% or so.