With the price of precious metals now on the rise, there is talk of gold and silver showing up in the news once again. With this renewed interest in commodities, it reminded me of my silver buying spree of the past 3 years. After the price plummeted in April of 2011, I have bought more silver than I care to admit, mainly because of its affordability and potential growth in the years to come. Silver is a great way for middle and lower class folks to put their money into safer assets, since its price is so much more accessible than gold.

Of course, an asset isn’t so safe when you buy it on the highs (which I learned when I bought my first ounce before April of 2011). Fortunately, gold and silver have largely reached a plateau in price. They are very near the price of mining and manufacture, which is to say, they’re pretty cheap. Now is a great time to get into the market if you haven’t already.

Since we’re striving for an affordable way to move our dollars into assets, one of the cheapest ways to do so is to buy silver coins. Not the collectible kind though. That’s a whole different ball game. If you just want silver, junk coins are the way to go.

For the uninitiated, junk silver typically consists of American coins minted from the early 20th century until 1964. During that time, most of the coinage was made up of 90 percent silver. Anything from before that time period is usually considered collectible. Anything after 1964 has no silver (with a few exceptions I’ll get to in a moment).

If you don’t have the money to buy silver in big bullion bars, Ebay is the cheapest place to buy junk silver. They happen to have a very active silver market, where you can find a large selection pretty much any time or day of the week. After spending a lot of time hunting down junk coins on Ebay, I perfected my procedure for spotting and procuring the best price for silver, which I’m going to share with you below.

The Tools You’ll Need

First log into Ebay, and in another tab you’ll want to open up this free silver calculator from coinflation.com. With this tool you can select any silver American coin from the past 100 years or so, the quantity of coins you’re trying to buy, and the current silver price. If you want an even more precise and current price, there are plenty of other websites that will provide that service for free. Once you calculate the numbers, it will tell you exactly how many troy ounces of silver you’re dealing with, and the total market value of the coins. Finally, open up any standard calculator you’d like to use.

What to Look For and What to Avoid

You’ll want to search with terms like “junk silver” “silver dimes” “silver quarters” and “silver half dollars”. Skip anything that looks like it’s in a plastic case, or is advertised as collectible. As you sift through the different listings, you want to look for very specific descriptions. Don’t buy anything that doesn’t tell you exactly what coins you’re getting. For instance, a very common and disingenuous tactic, is to say “2 Ounces of Silver Coins for Sale.” Sounds pretty straightforward right? Well, is it the troy ounces that silver is traditionally measured with (and how they’re measured on the stock market), or the lighter avoirdupois ounces used in the United States. Also, most of these coins are 90 percent silver. The other 10 percent is copper, which is so cheap it’s typically priced by the pound. Is the seller including the weight of that copper as well?

An honest listing will tell you the exact make and quantity of coins you’re getting. Or the listing may say “2 Dollars Face Value, pre-1965 Silver Coins.” That’s usually safe as well, because all coins before 1965 are 90 percent silver, and all silver coins are interchangeable. For instance, just as a half dollar is interchangeable with 5 dimes or 2 quarters, the amount of silver is the same in all three examples.

The only exception to this rule, is World War Two nickels (the only nickels that have silver), which are 35 percent silver, Kennedy half dollars made from 1965-1970, and Ike dollars from 1971-1976. Those happen to be 40 percent silver, and occasionally someone will try to sell them for the 90 percent silver price. These are all details you need to be on the look out for. Make sure those coins aren’t mixed into one of those “face value” deals.

Finding the Price Over Spot

The spot price is how much each troy ounce of silver is worth on the stock market. You will always pay a little more over spot for any physical gold or silver. After all, there is the cost of manufacturing and shipping the silver, and in the real world, the true price of any item is what people are willing to pay for it. I’ve found that the cheapest way to buy junk silver is at auction. Every “buy it now” option is usually way over priced, so avoid those like the plague. As a rule of thumb, I wouldn’t spend more than 6 dollars over spot, per ounce, and 2.50-5 dollars over is very feasible in most cases. Anything over that, and you’re getting into retail prices.

Now, here is where the silver calculator comes in. First, decide the highest price over spot you’re willing to pay. Once you know precisely how many coins are being listed, you can find out the exact number of troy ounces you’ll get from this purchase. In the silver calculator, you can change the spot price to whatever you want, so if you’re willing to pay 5 dollars over spot, add 5 dollars to the silver price per ounce. The calculator will total the cost, and give you the highest bid you’re willing to go for. If the seller doesn’t provide free shipping, you’ll need to use an ordinary calculator (or your brain if you’re really cool) to factor that into the price over spot.

A few final tips: just as with any other product, the more you buy, the lower the cost will be for each item. I wouldn’t bother with any listing that’s less than 1-2 ounces of silver. If you can, find auctions that end when most people are at work, and don’t bother bidding until the very last minute. This isn’t one of those Ebay items where you can casually make a bid and walk away. There’s a lot of buyers in this market, and unless your bid is outrageous, someone will always tack on their bid before the auction ends. You’ll only be jacking up your costs.

Inspecting Your Coins

Once your coins arrive in the mail you should inspect them all to see if they’re genuine. Most of the coins you buy will look identical to the coins you use every day. This means it’s possible for your seller to make a mistake, or maybe sneak a modern coin in with the rest (admittedly this has never happened to me, because I never buy from someone with a seller rating of less than 99 percent.)

The easiest thing you can do is simply check the date. If your eyesight isn’t what it used to be, or the date has been worn off, you can also examine the rim of the coin. If you look at the quarters and dimes in your pocket, you’ll notice the edges are a brownish color since their interior is mostly made out of copper. Silver coins will look just as silver on the edges as they do on the face.

You should be especially watchful for fakes when it comes to half dollars. That is the lowest denomination that is economical for someone to counterfeit (at least for now). I’ve found that the easiest way to inspect these is with the sound test. Find yourself a modern half dollar, and drop it from a short height onto a hard surface. Now do the same with your silver half dollar. The genuine silver coin will ring at a distinctively lower pitch than a modern coin.

Now your all done! Enjoy your new silver, especially the pre-World War Two coins that look way cooler than ours. All appearances aside, everyone should have at least some of their money outside of the banking system. So preserve your wealth today, and buy coins that were made when money was still money, and not the tacky copper chits we’re forced to use now.