Q: What are the pros & cons to buying the smaller denomination U.S. gold bullion coins like the ½ oz, ¼ oz, 1/10 oz coins?

Cons: The smaller the coin, the higher percentage premium you’ll pay.  So you’ll effectively be paying more per ounce of gold as the coin gets smaller. Generally, the 1 oz coins are the preferred size making them a bit more liquid.

Pros: These smaller coins are naturally also more affordable so you can start building a portfolio now.  If you want to invest on a regular basis and know you will never have more than $125-$150 to invest on a coin at any one time, then consider a routine of buying the American Eagle 1/10 oz gold coins. 

Sure, you’ll pay a little more in premiums, but at least you are bulding a portfolio and taking advantage of dollar-cost averaging. It’s better to start doing something than continually wait and do nothing.  By the time you have saved up enough for a 1 oz. coin, gold may have reached a whole new level and you’ll be shut out once again!  As the old proverb goes: “Make hay while the sun shines!”