Buying gold for retirement is an investment strategy Americans have begun to use commonly to protect their retirement accounts. A gold IRA is an IRS-approved way to get both the benefits of investment in a physical asset AND the benefits of a tax-advantaged plan.
How exactly is this done (and why)? What pitfalls are there to avoid?
This article explains the advantages of a gold IRA, outlines the steps and provides tips on buying precious metals for a gold IRA account the right way. The article is designed for those who are looking into buying gold for retirement—but it’s also a great refresher for those who already own one.
Why Should You Buy Gold for Your Retirement Portfolio?
With the economic and geopolitical stressors currently in play both globally and nationally, many investors are looking for methods to stabilize their retirement investments. One option many are considering is physical gold. Throughout history, gold and silver have served as unique complements to traditional retirement investments.
Buying gold for retirement has helped many Americans’ IRAs, 401(k)s, and other retirement savings accounts in the following ways.
- Hedges Against Inflation: When the U.S. dollar has lost power, physical gold (a commodity as opposed to a paper-based asset) often has either retained its value or thrived. This quality of physical gold protects the purchasing power of your retirement dollars.
- Protects Against Market Volatility: Because gold has often acted differently from stocks and bonds over time, this physical asset can provide desirable potential for diversification, an element of stability that can help retain savings value.
- Diversifies to Reduce Portfolio Risk: The role of gold in diversifying a portfolio (particularly coins and bullion), is to make it possible to reduce an investor’s overall portfolio risk and at the same time offer potential for growth over time.
Who Is Eligible for a Gold IRA?
Traditional retirement accounts by law can’t contain physical assets such as gold and silver. However, a special type of retirement account sanctioned by the IRS does allow physical gold and silver in an IRA. The gold and silver must be in allowable, approved forms (more about that below).
It’s important to follow the right steps to open one of the special accounts to properly diversify your retirement savings with precious metals. (Always consult your own retirement, legal, and tax professionals to determine if a gold IRA is right for you.)
To get the information you need to make this decision confidently and to open a gold IRA the right way, work with a specialized gold IRA dealer, such as Augusta Precious Metals. The dealer will help you understand the process, navigate any pitfalls, and streamline the transfer of your funds.
Here are a few of the rules (ask your gold IRA dealer about more):
1. Any precious metals held in a gold IRA must meet 99.5% purity standards.
2. Not all collectible coins are approved.
3. All metals in a gold IRA must be stored in an IRS-compliant facility.
4. With a gold IRA, you can’t store the metals yourself at home or in a bank.
Steps to Open a Gold IRA the Right Way
Step 1: Choose a trusted gold IRA dealer specialist to help you add physical gold to your retirement savings. Look for a company with an inarguable positive reputation. Ask a lot of questions to determine what they know about purity, documentation, regulations, etc. Finally, check out consumer reviews to see if there have been any problems with other customers.
Step 2: Open a gold IRA account with an IRS-compliant custodian that specializes in administration of gold IRAs. Your gold IRA dealer can recommend the best custodians and will often suggest one with which they are most familiar. Transfer money from your existing custodial account to your new one.
Step 3: Purchase gold (and/or silver) for your new account. Your gold dealer can help you ensure that your gold meets IRS requirements and arrange storage in a secure facility designed especially for this purpose.
Written by Augusta Precious Metals
This article is for informational purposes only. The opinions and analysis herein are those of the author and are not financial advice. The Jerusalem Post (JPost.com) does not endorse or recommend any investments based on this information. Investors should consider their financial situation, investment goals, and risk tolerance before making any decisions. Consulting a qualified financial advisor is recommended. JPost.com is not liable for any investment losses from using this information. The information provided is for educational purposes only and should not be considered as trading or investment advice.
