Are you looking for a way to diversify your retirement portfolio and protect your savings from inflation? Investing in precious metals through an IRA may be the right choice for you. An Individual Retirement Account (IRA) is a type of retirement plan that allows you to invest in physical metals such as gold, silver, palladium, and platinum. This type of account offers tax benefits that can help you save money now or in the future. When investing in precious metals through an IRA, it is important to be aware of the costs associated with transactions and the restrictions on the types of metals that can be held in the account.
It is also important to remember that precious metals should only make up a small portion of your retirement portfolio. Self-directed IRAs are the best option for investing in precious metals, as they allow investors to manage their own investments and own a wider range of products than other IRAs. We've partnered with New Direction IRA to offer the fastest and lowest cost setup and maintenance, so you can enjoy all the tax benefits of investing in an IRA. Read on to learn more about investing in precious metals through an IRA.
What Are Precious Metals IRAs?A precious metals IRA is an individual retirement account that allows you to invest in physical metals.
These are sometimes referred to as gold IRAs, but silver, platinum, and palladium can also be purchased in these accounts. The main advantages of investing in precious metals through an IRA are tax benefits.
Tax Benefits of Investing in Precious Metals Through an IRABy using an IRA to buy precious metals, the investor saves taxes now or in the future. The specific tax benefits depend on whether you choose a traditional IRA or a ROTH IRA. Traditional IRAs allow investors to put pre-tax (tax-deductible) money into their IRA to invest in the assets of their choice.
Restrictions on Precious Metals IRAsBecause the IRS considers gold and precious metals to be alternative investments, they can only be held in self-directed IRAs.
Beyond that, there may be expenses associated with transactions with precious metals, which may mean that homeowners take home less than the current spot price when they sell.You should also be careful when making a contribution to an IRA, as the depositary will reject unapproved metals. Perhaps most importantly, precious metal IRAs are more expensive than other investment options, according to Drew Feutz, certified financial planner (CFP) at Market Street Wealth Management Advisors.
How Much Should You Invest in Precious Metals?Depending on your financial situation, most experts recommend that you invest no more than 5 to 10% of your retirement funds in precious metals. Some IRA companies guarantee that they will return your gold at current wholesale rates, but you could still lose money if you close your account, something that normally doesn't happen with the normal opening and closing of IRAs.
Secure Local Storage Plan for Precious MetalsCreating a secure local storage plan allows precious metals to be sent directly to the IRA administrator, so that you (the IRA administrator) can choose where to securely store your physical precious metals. As you'll see below, there are also requirements for the type of precious metals you can buy in a retirement fund and where you can store them.
How To Get Started Investing In Precious Metals Through An IRASelf-directed IRAs can be set up in three simple steps, and this page contains lots of resources for learning how to start investing in metals through an IRA.
Self-directed IRA custodians allow investors to invest in alternative assets, including precious metals and real estate.In any case, remember that precious metals and precious metal funds should add some sparkle to your retirement funds, not become your entire investment strategy.