These coins are popular among investors seeking to invest in silver — mainly in small amounts. The word “junk” refers only to the value of the silver coins as a bullion investment and not to the actual condition of the coins; meaning, junk silver is not necessarily scrap silver.

 

The probably most commonly collected U.S. junk silver coins are the Mercury silver dimes and Roosevelt dimes, Washington quarters, and Franklin half dollars, and Kennedy half dollars, that are minted in or before 1964. These coins have a 90% silver composition (”coin silver”).

 

Less common junk silver is the Kennedy half dollars from 1965 to 1970, which contained 40% silver. The value of silver content is one reason investors buy junk silver coins. The percent of silver is less likely to come into question, than silver bullion bars, which require certification and authenticity tests.

 

A “bag” of junk silver, ($1000 face) contains approximately 715 ounces of silver. And, it will generally track the spot price of silver. If silver goes up ten cents, a bag of 90% silver coins will rise $70 or so; however, prices sometimes lag sharp spot price movements because of the liquidity of junk silver coins.

 

To gain the benefit of junk silver as an investment, investors must sell his or her coins through a coin dealer, on an on-line auction site, or classified advertising. Selling through any of those means usually takes a few weeks, therefore the liquidity of an investment is gradual.

 

When bags of circulated 90% silver coins can be bought — at about the same premium as 100-oz bars, or even at small premiums over 1-oz silver rounds — bags should be the first choice for many investors because of the reduction in price when an investor buys in bulk.

 

Buyers can expect to pay a little more for half-dollars than for dimes or quarters because of the higher silver content as well as half-dollars are much more popular. Yet another reason for the demand of half-dollars is fewer half-dollars were minted than dimes or quarters.

 

Although many investors buy junk silver coins as bullion investments, other investors buy junk 90% silver coins for “survival purposes.” These buyers fear the worst for the dollar. They fear the dollar will be printed until it becomes worthless. If this “worst-case scenario” were to become reality, then U.S. 90% silver coins would be used the purpose they were originally minted: as money.

 

The history of paper currencies have been to print until those currencies became worthless. Actually, today most dollars in circulation are not printed but are “electronic” or digital dollars, created by the Federal Reserve to increase the supply of money, which many argue increases inflation.

 

Choosing between junk silver coins or bullion bars is largely a matter of an investor’s goals and resources. Although before 1965, silver coins would be ideal for survival purposes. Junk silver coins sell at premium, or below premiums on 100-oz bars and, 1-oz silver rounds, junk silver coins hold greater upside price potential than .999 fine silver bullion products. At times, and especially during rising precious metals markets, circulated U.S. silver coins pick up premiums.