When investors consciously choose to include precious metals in their investment strategies, it’s usually in an effort to preserve the wealth they’ve accumulated from other holdings. Many find the addition a sort of “insurance” against the risk of crises or inflation. 

The trick is finding a reputable, well-qualified firm to work with, like 7K Metals, a business that was given the honor of being the 2021 company of the year. A trusted establishment will provide solid answers to inquiries plus be able to go beyond the questions to serve the clients’ best interests.

Many investors look to these firms to determine which precious metals are adequate for investment, especially those new to the asset and unsure of what constitutes an adequate product. 

The metals need to meet specific IRS stipulations for inclusion in an individual retirement account. These companies will display those varieties with clear documentation or at least be able to discern these for the client. 

Let’s look at precious metals a bit more in-depth and a few facts that will let you know whether a metal is authentic.

Are Your Precious Metals Authentic

When investing in precious metals for an individual retirement account, only certain ones are IRS-approved. These include gold, silver, palladium, and platinum. 

The metals also need to meet specific stipulations by the Internal Revenue Service, particularly a degree of purity and only certain minted government-issued coins, plus bars and rounds. 

When searching for trusted firms, like 7K metals, touted as among the leaders in 2021, it can be daunting to determine whether the products offered with each are authentic. 

Some companies tout counterfeit wares to scam investors making it necessary to research the dealers and educate on the precious metals to become informed on what makes a legitimate product. Learn what precious metals are at https://www.investopedia.com/terms/p/preciousmetal.asp. Let’s look at a few facts pointing to the authenticity of precious metals.

• Genuine precious metals will weigh more than a fake product

When looking for authentic precious metals for investment, one of the primary features that should be considered is the product’s weight. A genuine metal will carry more weight than a false one. 

In many cases, a company attempting to scam clients who might have minimal knowledge of precious metals will try to use “mercury” or other alternatives to create realistic-looking “decoys” for the genuine products of gold, silver, palladium, and platinum. The real options will carry substantial weight in comparison.

• A precious metal product will include a “hallmark”

If you purchase jewelry from a dealer carrying a “hallmark,” this signifies from the seller that the item achieves the standards set for precious metal contents. 

“Hallmarks” are typically something you’ll see inside the surface of a ring or within the area with the clasp of a bracelet or necklace. “Hallmarks” tend to follow in each category as such:

1. Gold: Jewelry consists of the purest substance, “karat gold.” Items with a 100% pure gold content will enlist the “hallmark” 24K meaning 24 karat gold. If you see 22K, that will let you know the product carries 90% purity. 

A “GF” hallmark means the jewelry comprises a “gold overlay.” That means the product consists of a blend of alloy metals along with the gold. Some manufacturers will use “GP” to designate that the pieces are “gold-plated.”

2. Silver:  A sterling silver or solid piece of silver will be minimally “92.5%.” Anything with this consistency will carry the hallmark indicating “925” or “sterling.”

3. Platinum: For this precious metal to be authentic, the content must be at or above 95%. A consumer will notice the “plat” or “platinum” hallmark for a genuine platinum piece of flatware or jewelry. 

4. Palladium: Experts in the precious metal industry have yet to determine a precise rating for palladium. The hallmark used most by jewelers for any accessory with palladium in the contents is “pd” or “pall.”

• Precious metals leave a mark of authenticity

If you are challenged to find the natural markings for precious metals, another distinction can be made by using a cloth to “massage” the item. An alloy or false gold will present a gold residue on the material, while the genuine product will leave no mark at all.

However, real silver products are the opposite, as they will turn a cloth black, and the alloy mix will not leave a mark of any kind.

• There is no magnetism with precious metals

A legitimate precious metal has no magnetic capacity. If you were to put a strong magnet against a piece of genuine jewelry or a coin, it would slide off the piece. If it holds firm, there has to be an alloy in the mix instead of the item being pure. Go here to find out which metals are the most precious in the world.

• Glass is safe around a real piece of gold

An actual piece of gold is “malleable” and soft, disallowing it from marring a glass surface, but a counterfeit piece will be able to scratch the surface. You can test the theory by taking an item of gold jewelry to draw on a glass window or some other glass surface or even use it against a tile backdrop. 

A false product will leave a black streak on the tile, whereas an item with pure content will leave behind a yellow stain on the tile material.

• Warm-up with silver

The suggestion is a pure piece of silver compares to a person’s body temperature in warmth, whereas a stainless steel product offering varied metallic properties feels cold to the skin. Stainless steel absorbs heat faster, resulting in a lack of heat. This steel is often a substitute for pure content.

The authentic sterling silver has the potential for “melting ice” due to its “conduction of heat energy.” You can test that theory by placing a piece of ice on a silver coin to see it melt, but a substitute metal won’t work.

Final Thought

An investor informed with a few facts when ready to purchase precious metals with a dealer will be able to spot the genuine items from the counterfeit. That will save you from working with a scammer and help you find legitimate, experienced, and trusted firms, like the representatives at 7K metals and other leaders in the industry.