Buying Silver Locally

If you want to buy pre-1965 silver coins, do a search on "coin dealers" in your area. For example "coin dealers Atlanta". As you look over the dealers, you want a dealer that uses the word "exchange" in their list of services. 

A dealer who focuses his business on numismatics (a person who studies rare coins), is buying and selling coins based on collector value, not silver content. Try to avoid these dealers. If they are your only available dealer, let them know up front that you are not a collector and you want your purchase to be based on silver content, not collector value. Make sure they have a troy ounce scale available to weigh your purchase. 

You also need to know if your state charges sales tax on your exchange. This could be a significant hit to your silver value. If your state charges a sales tax, look for a neighboring state that doesn't charge anything. Remember, this is merely a currency exchange, not a purchase. The federal government considers silver and gold as a form of currency. So make sure you tell your dealer that you are exchanging your dollars for silver value. Some states do charge a tax though, so beware. Check http://www.goldbuddy.com/states/state-gold-laws/ to see if your state does. You will make your purchase in dollar currency. Do not use credit cards, checks, etc. Use the largest denominations possible to keep the bulge in your pocket from being noticed.

When you are ready, call the dealer and tell them what you want to do, make an appointment and keep that appointment. Take your cash with you. If there are other customers in the store, don't expect the dealer to engage in small talk. His focus will be on watching what goes on in the store and also making sure he doesn't make a mistake and loose money. 

The most typical way to buy pre-1965 coins is in face value bag lots.

When buying silver by face value (FV), meaning the sum of the dimes and quarters, the actual silver content in troy ounces (toz) could vary by as much as 10%, which is between 660 and 723 toz.  The average is about 715 toz. The reason for this is that used coins don't contain as much 90% silver content as new coins.

For example:
A typical $1,000FV bag of pre-1965 silver dimes and quarters will weigh about 715 toz due to their being well used and worn over their lifetime. A bag of new coins could weigh about 723 toz, but their value to collectors would be much higher than their silver content, so don't expect to get close to that amount.

If a bag has been circulated between buyers and sellers many times, the bags may have been culled by collectors looking for coins with collector value. If these coins were not replaced with like FV coins, the bag will weigh less, down to the lower range of 660 toz, about 8% less than the average of 715 toz.

Why is this important? The difference between 660 toz and 715 toz is 55 toz. At an average current spot price of $32/toz, that's a difference of $1,760. A $1,000FV bag of silver weighing 715 toz, at $32/toz, would be valued at $22,880.

When you buy silver, you will pay what they call spot+. The + is the amount that goes to the seller to cover their operating costs of running a business. Typical addons to the spot price should be around the following. This is only a guide. If it's much higher, then shop around for someone closer to these spot+ rates.

Using a spot price of $32/toz for dimes and quarters:
(Add the value and the fee to get your cost)
FV            Spot+       Avg Value     Seller's Fee
$5              8%               $114            ~$9.16
$10            5%               $229            ~$12
$250          4%            $5,720            ~$229
$500          3%          $11,440            ~$343
$1000        2%          $22,880            ~$458