You may have heard of the increasing scarcity of “junk” silver, which generally refers to pre-1965 US dimes, quarters, and half-dollars that contain 90% silver. The scarcity indicates people are stockpiling, and so it might not be long before you get the opportunity to actually transact some barter business with junk silver. Some clients have asked us to walk them through the process of calculating the actual value these old coins.
Let’s start by using the round number of $20 for the silver spot price. The spot price reflects troy ounces, which measure about 31.1 grams. A Mercury dime contains 90% silver and weighs 2.5 grams.
2.5 grams ÷ 31.1 grams = 0.08The dime is about 8% of a troy ounce.
0.08 x $20 = $1.60If the dime were 100% silver, it would be worth about $1.60.
0.9 x $1.60 = $1.44At 90% silver, the Mercury dime is worth about $1.44 when the silver spot price is $20.
You can do these same calculations for the silver quarter when you know that it weighs 6.25 grams, about 20% of a troy ounce:
0.20 x $20 = $4.000.9 x $4.00 = $3.60At a silver spot price of $20, a pre-1965 silver quarter is worth about $3.60.
Keep in mind that the other 10% of these coins is composed of copper, which is also an expensive metal, if relatively cheap compared to silver. If you’re doing a bigger transaction with junk silver, you might want to add the value of the copper to your calculations.
Of course, for most people, doing these sorts of calculations on the fly is cumbersome and they’d prefer to use a calculator. If you’re dealing with someone unfamiliar with the use of silver, then the transaction can become even more tedious as you walk him or her through the process.
A much more straightforward alternative to junk silver is fractional silver rounds. These are privately minted rounds that come in weights such as 1/2, 1/4, or 1/10 of a troy ounce. They are made of .9999 pure silver and clearly labeled.
Because of this, their value is far easier to calculate. For example, with the 1/2 troy ounce rounds found in our newSilver Barter Bags, you only need to know the spot price of silver and divide it by 2 to figure out the value of a single round. Easy!
Take a moment to view Peter Schiff’s live video demonstration of the Silver Barter Bags:
