People who spend money to buy gold probably hope that they will make money on it one day. Or maybe they fear inflation and worry that gold will all that can be used if their is a societal breakdown. Then again, there are countless souls who get caught in a golden trap by believing they should buy commemorative gold-plated coins. Collectors Dashboard wants to lay out why buying gold plated commemorative coins is a bad investment.

The goal of Collectors Dashboard is to evaluate collectibles as an alternative asset class. This means that high-end collectibles are being purchased with the same capital that would have been invested in stocks, bonds or real estate. Collectors and investors just need to know that not all collectibles are good investments. Some are atrocious.

First and foremost, actual gold coins are valuable. If they have historical significance they may be priceless. If a commercial or advertisement for “gold coins” contains the word microns you need to leave them alone.

While this may not be true in every occasion in life, there is a really easy money-saving rule to live by when it comes to gold coins. Gold plated commemorative coins are a bad investment, and they may have no actual value at all after you back out the time effort used to get whatever real is there.

The countless numbers of coins sold on late-night television are something to be weary of. It may even be the case that ANYTHING being sold on late-night TV is a bad buy, but be weary of those gold plated commemorative coins.

The difference between gold-plated commemorative coins and those 50-state quarter sets your grandparents gave you is that those quarters are still at least worth the face value of each coin. Anything backed by the U.S. Mint has some value to it. The countless numbers of third-party mints which sound official but which are unaffiliated with the production of legal American coinage have little to no real value.

Gold plating is simply the bonding of a metallurgically small sample of gold to a lesser metal. Here is why those commemorative plated coins are worthless — the amount of gold used may be just .09mm and 24KT as a small sample sheathed over any available metal to make something that resembles a coin.

Where things get real dicey is when people take these to be sold after paying $29.99 or $39.99 (or more) is that a bringing a an entire roll of these plated coins to a cash-for-gold sale might net $5.00 or less. That is even depending if the proprietor of the shop wants to fool with it.

Without the backing of the United States Mint for production or without a respected source for gold coins, it is imperative to understand that gold-plate commemorative coins are effectively just some people in a warehouse making shiny yellow circular tokens. Some pitches on TV commercials may make it sound like a seller’s life depends on it, but this should come with the understanding that you are being legally enticed to buy something that looks impressive but has no value. In a comparison to jewelry, fake diamonds and beads may look pretty, but their value may be zero even if the price of real diamonds were to rise tenfold overnight.

Gold plated commemorative coin-makers are able to use the word “gold” by providing the most entry level amount to legally proclaim gold and still finish the commercial for the low-low price of $19.95.

Gold plated coins are frowned on by the knowledgeable collectors. Coin shop or pawn shop owners often have to deal with irate people after they find out that no true coin buyer will buy them. After all, why should they be expected to buy something that is worth 10-cents just because someone else was suckered into paying $19.99? Most reputable coin dealers do not sell the commemorative coins at shows or in their shops. Isn’t that a likely indicator of future value?

This may sound odd, but forcing value onto a numismatically valuable coin does not actually increase the value. It would take potentially thousands of coins like that just to get an ounce of gold. Think about this dilemma — there are countless sellers on TV for gold plated commemorative coins, but not a single commercial advertisement is advertising to buy gold commemorative coins.

The tragedy of September 11, 2001 and other key historical events have been hijacked by the people who make gold plated commemorative coins. These may tug on your heart and emotions, but just understand that these are not the type of gold coins that true gold bugs and investors seek to own.

Please remember that not all collectibles are worthy of investment. They may sound cheap or enticing, but they aren’t.