Gold can be an attractive asset to diversify a retirement portfolio. But owning physical precious metals may prove more complex.
Coins eligible for inclusion in an Individual Retirement Account must meet certain fineness standards and follow IRS regulations, including not containing collectible coins (which the IRS considers illegal investments).
IRA Custodians
An IRA custodian is responsible for purchasing precious metals on your behalf and keeping them secure in an IRS-approved depository. They typically keep your investment segregated, keeping it separate from that of other investors’ investments. Since IRA regulations restrict what kinds of metals can be included and how they must be stored, choosing an expert company that can guide you through this process and work with reputable dealers is key – look for industry trade groups as a reference and conduct your own due diligence before making a purchase decision.
Add gold coins to your IRA either through a transfer from another retirement account, or opening a self-directed IRA that allows for investment in alternative assets such as precious metals and real estate. No matter the method chosen, the custodian of your account will purchase and deliver it securely at a depository of choice.
IRA Eligibility
For optimal IRA investments, it is wise to work with an established IRA company which sells IRA-compliant metals. To meet IRS rules on precious metal investments in an IRA, work with them.
Once you find a self-directed IRA company that offers IRS-approved coins and bars, the process should be relatively seamless. Your custodian will process payments to the dealer directly before sending it off to be stored at your depository.
An investment in physical precious metal assets may help diversify your IRA portfolio and mitigate risk during periods of economic instability or stock market crashes, though be wary if you cash out prior to retirement as it could incur substantial taxes and penalties. It’s advisable to speak to a financial expert who can explain all potential benefits and drawbacks of this strategy before taking this route.
IRA Fees
Gold IRAs are typically managed by self-directed IRA custodians with experience administering alternative assets like precious metals. These companies charge annual fees for their services as well as one-time setup and storage charges.
Gold coins and bullion purchased for an IRA must meet purity guidelines established by the IRS, meaning rare coins such as South African Gold Krugerrands do not qualify. On the other hand, American Eagle bullion coins and proofs do.
Additionally, precious metals IRAs must only be stored with an authorized depository. While some companies advertise “self-storage” options as legal solutions for these IRAs, this practice may lead to penalties from the IRS.
Gold in an IRA can be an excellent way to diversify your retirement portfolio and protect against inflation, but before making any decisions be sure to conduct thorough research and speak with knowledgeable advisors. They can assist with finding an IRA custodian and investing in products tailored specifically for your unique situation.
IRA Withdrawals
Gold IRAs come with specific rules, so it’s vital that when selecting an IRA company it includes precious metals specialists as advisors. Furthermore, your investments must be stored safely; according to IRS rules they cannot be stored at home or in personal security deposit boxes, as this would count as distribution and lead to taxes and penalties being assessed against them.
Your IRA custodian should use an approved depository to store metals separately and safely. Avoid purchasing coins considered collectible by the IRS as these won’t qualify as gold IRA investments; only coins minted by the U.S. Mint or an established metals company fulfill purity guidelines required to qualify as an IRA investment. To learn more about setting up an IRA with Goldco, get in touch with one of their precious metal specialists who specialize in gold.
