Bullion investors know governments are fickle and sometimes change the rules to suit their whims. They know the U.S. government has piled up more debt and obligations than it can hope to meet, and they can pretty much guess the ramifications. Fiat currencies die – often spectacularly.

That’s why lots of proponents of holding physical bullion insist that you must take possession of the metal you buy. “If you can’t hold it, you don’t own it,” they say.

It’s pretty darn good advice. The simple truth is that if your metal is not under your direct control and you have to rely on some third party, you are definitely assuming some risk.

However, there are at least a couple of scenarios when outsourcing the storage of your metals is a good idea.

The first scenario involves physical security of the metal.

Some investors live where they are at higher risk of burglary. Perhaps they live in a tough neighborhood. Or maybe someone in the family is battling drug addiction and acting desperately. Sometimes the need for physical security may trump all other considerations, and the investor will choose to store some or all of his metals in a depository that offers a UL-rated Class 3 vault and 24-hour monitoring.

Investors with large holdings may also decide that putting all their bullion in a single location represents too much concentration of risk. The choice to utilize depositories might make better sense than stuffing the basement safe with a life savings’ worth of metal.

Read the entire article here.