Gold Purity, Fineness, and Karats
Gold purity is measured two ways: karats, which express gold content in 24ths, and fineness, which expresses it in parts per thousand. Twenty-four karat gold is essentially pure, written as .999 or higher, while 22-karat gold is .9167 fine. Bullion coins range from 22-karat issues like the American Gold Eagle to .9999-fine coins like the Canadian Gold Maple Leaf.
Karats: Gold in 24 Parts
The karat system divides an item into 24 equal parts and counts how many are gold. Eighteen-karat gold is 18 parts gold and 6 parts other metals, or 75% gold. The system is used mostly for jewelry, but it also describes some bullion coins.
| Karat | Gold content | Fineness | Common hallmark |
|---|---|---|---|
| 24k | 99.9%+ | .999 to .9999 | 999 or 9999 |
| 22k | 91.67% | .9167 | 916 or 917 |
| 18k | 75% | .750 | 750 |
| 14k | 58.3% | .583 (often .585) | 585 |
| 10k | 41.7% | .417 | 417 |
The remaining metal in lower-karat gold is usually silver, copper, zinc, nickel or palladium. Those alloys change color and hardness: copper gives rose gold its tint, while nickel or palladium produces white gold.
Fineness: Parts per Thousand
Bullion markets prefer fineness, also called millesimal fineness, because it is more precise. Fineness is written as a decimal (.9999) or as a whole number of parts per thousand (999.9). Common grades include:
- .995: the minimum for large Good Delivery bars in the London wholesale market, and the IRS minimum for gold bullion in an IRA.
- .999 ("three nines"): common on smaller bars and some coins.
- .9999 ("four nines"): the standard for many modern bullion coins and minted bars.
- .99999 ("five nines"): occasionally produced by the Royal Canadian Mint for special issues.
For bullion buyers, fineness matters less than fine weight. A coin's value tracks how much pure gold it contains, which is why a 22-karat one-ounce coin and a .9999 one-ounce coin hold the same amount of gold even though they weigh different amounts. Our troy ounce guide explains fine weight vs gross weight.
How Popular Bullion Coins Compare
22-karat coins
The American Gold Eagle and the South African Krugerrand are both 22-karat. Each one-ounce coin contains one troy ounce of gold, with added alloy bringing the total weight to roughly 33.9 grams. The Gold Eagle's alloy includes silver and copper; the Krugerrand's copper gives it a warmer, orange-tinged color. The British Sovereign is also 22-karat.
Harder 22-karat alloys resist scratches and dents better than pure gold, a practical reason this standard was used for circulating coins for centuries.
24-karat coins
The American Gold Buffalo, the Canadian Gold Maple Leaf, the Austrian Philharmonic and the Australian Kangaroo are .9999 fine. The Royal Mint's Gold Britannia moved from 22-karat to .9999 in 2013. Pure gold is softer, so these coins are often sold in protective capsules or tubes.
Purity and Retirement Accounts
Under 26 U.S.C. 408(m), gold bullion held in an IRA must generally meet the fineness required for delivery on a regulated futures contract, which the IRS applies as .995. The law makes a specific exception for American Eagle coins, so the 22-karat Gold Eagle qualifies even though it is below .995. Other 22-karat coins, such as the Krugerrand, do not get that exception and generally cannot be held in an IRA. Our page on IRS purity standards covers all four metals.
Goldco, a precious metals company, lists both Gold Eagles and .9999-fine coins such as the Gold Buffalo and Gold Maple Leaf for IRAs. Our overview of gold coins available through Goldco describes them. As with any seller, confirm each product's eligibility with your custodian.
Terms That Sound Like Gold but Aren't
- Gold-plated: a microscopically thin gold layer over a base metal, with negligible gold value.
- Gold-filled: a thicker gold layer bonded to a base metal, still mostly base metal by weight.
- Vermeil: gold plating over sterling silver.
- Layered or clad: marketing terms that typically indicate plating.
Hallmarks can be faked as easily as the metal, so a stamp alone doesn't prove purity. Our guide on how to spot fake gold and silver describes tests that go beyond markings.
Frequently Asked Questions
Is 24k gold always .9999?
Not always. "24 karat" is used for gold at .999 and above. Bullion products usually state the exact fineness, such as .999 or .9999.
Is 22k gold worth less than 24k?
Per gram of total weight, yes. But a one-ounce 22-karat bullion coin contains a full troy ounce of gold, the same as a one-ounce 24-karat coin.
Can gold jewelry go in an IRA?
No. Jewelry is generally treated as a collectible and typically falls below the required fineness.
What does "999.9" stamped on a bar mean?
It means the bar is 999.9 parts gold per thousand, the same as .9999 fine.