A gold IRA can be a traditional IRA, a ROTH IRA, a SEP IRA, a SIMPLE IRA, or an inherited IRA that is self-managed and owns IRA-eligible physical gold coins or gold bars. The first step in converting an IRA into physical gold is opening a new account. Most traditional IRA and 401 (k) plans don’t allow the purchase of physical gold due to the special requirements involved. Many people fund their new account with some or all of their funds in an existing retirement account
.
IRS rules allow funding a Gold IRA with funds from another IRA, 401 (k), 403 (b), 457 (b), or Thrift Savings Plan. To start the process, contact your current retirement plan administrator and let them know how much you’d like to transfer. It’s important that you understand all costs and expenses before you buy physical gold to keep in an IRA. Many Gold IRA companies have preferred custodian banks that they either recommend or require customers to use them, or you can search for a custodian on the RITA
website.
Most companies that offer gold and silver IRAs allow you to buy precious metals from any reputable metal dealer. If you’re not sure whether transferring funds to a Gold IRA is the right move, talk to your account or financial planner. If you’re considering transferring money to a Gold IRA, contact your existing IRA custodian for information about the fees or charges you may incur. Similar to a SEP IRA, employees who participate in a simple IRA plan are essentially opening their own traditional IRAs through the employer (although an employee could technically open a 401 (k) account via their SIMPLE plan
).
They sell gold coins, gold bars, and the like, but they don’t offer IRA investment advice (although their websites or other marketing materials might suggest so). Unfortunately, most Gold IRA companies don’t have a particularly good record when it comes to fee transparency on their websites, so finding out the details can result in a phone call or two. Not only does physical gold not suffer from the types of risk mentioned above, but neither silver nor gold have reached zero or lost their value in a market shock. In practice, this means that the minimum requirements of many gold IRA companies would require you to invest much more than the 5% or less that financial advisors generally recommend investing in precious metals, which could put your nest egg at too
much risk.
Or, if you have a traditional retirement savings account and want to increase your exposure to gold, read here how you can buy a gold ETF, an exchange-traded fund that tracks the performance of gold. Gold IRAs help diversify a person’s retirement account and serve as a hedge against specific financial factors. An important rule to know about keeping physical gold in an IRA is that your precious metals MUST be kept at an approved depository such as the Delaware Depository Service Company or Brink’s Global Services and not in your home or in a safe deposit box. A gold IRA is a type of self-managed individual retirement account that allows individuals to keep physical gold, silver, platinum, and palladium
in the account as investments.
