Gold and other precious metals are an excellent addition to a retirement portfolio, providing diversification as well as the potential for tax-sheltered growth.
However, not all mainstream IRA custodians provide the option for opening self-directed IRAs that invest in physical precious metals. To do this, you must choose an IRS-approved custodian.
IRA Qualifications
IRAs are retirement accounts that allow pre-tax contributions and allow investors to invest in precious metals like gold. You can open one from scratch or rollover an existing IRA or 401(k).
Reputable precious metals companies make the entire process simple and stress-free, from setup to communication with specialists directly throughout. Many also work with reliable depositories such as Delaware Depository to store assets safely.
When selecting a company, you should carefully evaluate both its products and prices before making your selection. Furthermore, ensure your precious metals comply with IRS regulations – purchasing collectible items from dealers not approved by the IRS could result in distributions and incur an IRS 10% penalty fee. Lastly, find a custodian with low fees who can keep your account active while safely storing your assets.
IRA Fees
Gold can serve as an effective hedge against inflation, and you may use it in an IRA as long as early withdrawal penalties don’t exceed 10%. However, precious metals do not produce yield and don’t provide returns comparable to stocks or bonds.
An Individual Retirement Account (IRA) comes with its own set of fees that can quickly add up, such as account setup, storage and insurance charges and any markup on sales costs that can differ depending on company and product type.
Reputable IRA gold dealers should be open about all fees when you make purchases and will make this clear during their explanation. Furthermore, working with companies that offer potential buyback options could give you more security in selling back precious metals when necessary.
IRA Taxes
Investment in gold and other precious metals with an IRA poses several distinct obstacles. Ownership issues of physical coins or bullion require storage and insurance costs that could add up over time, which adds up quickly over time.
Tax considerations of investments also exist. If you purchase precious metal coins or bullion in an IRA and later wish to sell it, the IRS requires that capital gains taxes are assessed on its spot price at sale time.
One way around this rule is through investing in an exchange-traded fund that tracks a specific precious metal’s price, but that may not suit everyone. Furthermore, there may be other methods available to gain exposure to that precious metal’s price – for instance buying shares in mining companies that produce it.
IRA Rollover
When purchasing precious metals for retirement accounts, typically working with a gold IRA company is your best bet. They will arrange the transaction with a reliable metals dealer before shipping your bullion off to a depository for safekeeping. While some companies tout using an IRS loophole to store precious metals at home – an idea which could result in costly IRS penalties – storing precious metals yourself can often prove too risky and may lead to unwanted surprises later down the road.
GoldCo, Augusta Precious Metals and American Hartford Gold Group are three reputable companies that specialize in providing consumers with access to IRA-approved gold and other precious metal investments. Each provides an assortment of precious metal coins with reasonable rates at reasonable rates with excellent customer service teams in place. In addition, the companies’ websites feature live chat options that connect investors directly to subject matter experts; daily availability provides detailed product knowledge while even helping investors compare spot market metal prices!
