Low Cost Vault Storage: A Solution for International Clients

This article was written by Dickson Buchanan, SchiffGold Precious Metals Specialist. Any views expressed are his own and do not necessarily reflect the views of Peter Schiff or SchiffGold.

For international customers who want to invest in physical gold and silver, taking delivery of metals can be an irksome situation.

The cost of shipping isn’t the problem. Shipping and insuring gold internationally is actually quite affordable, and SchiffGold offers low international shipping rates to over 60 different countries.

However, the real problems occur at the border of the receiving country. Despite international customs regulations which allow .9999 pure gold to remain free from value added taxes or duties, many customs officials will charge a fee to have the metals released. Sometimes this fee is as large as 20% of the total value of the package. This is particularly a problem in Central and South America where corruption at the border is rampant.

This is unfortunate as it keeps a lot of investors from being able to comfortably invest in internationally recognizable gold and silver bullion products. This is especially true if there is not a robust local market for such investments, which is the case for countries in Central and South America and in many countries in Europe.

However, all is not lost. There is hope for international clients who run into these problems. The solution is 100% allocated and segregated vault storage where the client has complete access and control over his or her metals every step of the way. This is exactly the kind of storage that we offer here at SchiffGold. With vaulted storage, clients can be the full owner of precious metals without having to worry about the costly risk of getting metals through customs agencies. The vaults we work with are located in select regions of the globe where there is mutual respect for property rights and rule of law is still adhered to. The jurisdictions offer a stable environment where political and counterparty risk is minimized. Currently this includes several locations in the US, Canada, Switzerland, and Singapore.

Storing metal in a high security vault offers a number of advantages for international clients.

First, they have complete control over their metal. Since we only work on a 100% allocated and 100% segregated basis, it means that you are the sole owner of the exact same products all the time. You can have those metals shipped to you or to any location of your choice at any point.

Second, it makes selling the metals at a later date significantly easier and more streamlined. Since we hold an account at each vaulting institution, all clients have to do is give us a call, fill out a one page form, and the metals are transferred from their account to ours. We then wire the funds for the sale directly to their account.

Third, it is a low cost option. The cost of storage is on average only 0.5% of the annualized daily average value of the metal. Comparing this with the potential cost of paying a 20% IVA on the value of the metal, there is simply no comparison. You could literally get 40 years of secure vault storage at the same rate! (20/.5 = 40). For example, if you are looking to store $50,000 worth of metals, your annual cost of storage only comes to $250/year. If you were an international client looking to take delivery of $50,000 worth of metal and get stuck with a 20% value added tax or duty, you could potentially pay up to $10,000.

Fourth, it’s secure, really. These vaulting institutions are amongst the most secure, discreet, and resilient institutions in the world. Not one of the vaults we work with is connected to the modern banking system. Everything is held off the books on behalf of the client and never used as a collateral instrument. Even if things get really bad, and we think they could, these types of institutions are going to be your best bet in such an environment. Nothing can replace having something nearby, but comparatively speaking there simply isn’t a safer place to put your metals long-term.

International storage also offers an important way clients can diversify their metal in different jurisdictions of the world. This minimizes counterparty risk to their host country and assures that a portion of their assets are not only outside the global banking system but outside their home country. Moreover, opening an account is easy and discreet. Most accounts are opened in 2-3 business days and you can actually open an account after you have made a purchase through us or elsewhere. Metals that you own currently can be sent to your storage account as well.

Demand for secure vault precious metal storage has increased as problems in the global economy continue to escalate. Gold and silver are without question the most important assets to own in light of a potential financial collapse. They are the antidote to the modern financial system. Secure storage allows international clients to own those assets in a safe, accessible, and affordable manner. Don’t let the bureaucratic whims of customs agencies keep you from securing your financial future. Consider opening a storage account through SchiffGold today.

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