| In 1967, the government of South Africa minted | | | | later, the value of the krugerrands will be based |
| the gold krugerrand to increase the marketing of | | | | upon gold prices at that time. Like any |
| South African gold. Although the krugerrand is | | | | investment, buying gold krugerrands is never a |
| considered as legal currency in South Africa, it is | | | | "sure thing." When the man dies, gold may be |
| rarely used for that purpose. Instead, it has | | | | priced at $150 per ounce, meaning that the family |
| become a favorite of coin collectors all over the | | | | will have lost money on the investment. However, |
| world, known as "medal coins." This was the first | | | | gold prices may well be $700 per ounce, giving |
| coin to be valued at the monetary value of gold, | | | | the family a sizeable return on the investment if |
| or the current rate of gold prices. For example, a | | | | they decide to sell the krugerrands. In cases like |
| U.S. silver dollar is worth exactly one dollar unless | | | | this, probate attorneys recommend that surviving |
| it is unusual in some way that makes it more | | | | heirs consult a coin dealer about the fluctuation of |
| valuable to collectors. The krugerrand was | | | | gold prices; knowing when to sell and when to |
| originally a one-ounce piece of 22 carat gold with | | | | hang on is a matter that requires professional |
| no monetary value imprinted on it; its value is | | | | consultation. |
| based upon the market gold price that frequently | | | | If you buy gold krugerrands as an investment, |
| fluctuates. Today krugerrands are made in a | | | | keep in mind that these coins are 22 carat gold; |
| variety of weights, including half-ounce, | | | | an extremely high grade in quality. Pure gold, at |
| quarter-ounce and one-tenth ounce. | | | | 24 carats, is too soft to be minted so it is "cut" |
| Coin dealers and collectors often obtain | | | | with various amounts of metal to make it hard |
| krugerrands through estate sales. The price that | | | | enough to mint. Novice investors often make the |
| the dealer or collector will pay depends upon the | | | | mistake of comparing the gold prices for jewelry |
| current gold market price on that particular day. | | | | items made from 18, 14, or 12 carat gold with |
| For example, imagine that a family man invests in | | | | the gold price or market value of the 22 carat |
| buying 100 krugerrands when the gold prices are | | | | krugerrand. All gold is not created equal! |
| $300 per ounce. When the man dies ten years | | | | |