There are two ways to invest in gold using an IRA. One option is to set up a self-directed gold IRA, which allows you to buy physical gold and silver with pension funds. 5 It is also possible to invest in a mutual fund or ETF that invests in precious metals, although this is not the same as owning physical gold bars. To invest in gold with an IRA, you must follow two IRS guidelines. First, you can only invest in IRS-approved gold.
While the list of approved options is changing, the IRS says it must be “highly refined precious metal.” Gold IRA companies vary in terms of experience, service, and costs. So take a look around and compare your options before you proceed with opening an account. Physical gold can play an important role in a well-diversified retirement portfolio. However, certain rules must be followed if you want to take full advantage of the full benefits that an individual retirement account (IRA) can offer for gold or other precious metals. These funds buy up a basket of gold-related investments, such as stocks in various gold mining companies.
While you can gain exposure to gold in a normal retirement account by owning stocks or funds, you can’t hold the physical asset in an IRA or 401 (k). You may love South African Krugerrand gold coins, but you can’t add them to your IRA Gold account. A precious metal IRA is a self-managed IRA that allows you to hold certain types of precious metals (gold, silver, platinum, and palladium) as part of your overall asset mix. Investing in a gold IRA is a great way to diversify your retirement portfolio for a number of key reasons.
A gold IRA, also known as a precious metal IRA, is a special type of individual retirement account that specifically allows investors to add gold bars or coins or other approved precious metals as qualified investments. If any of the above IRA-eligible gold coins or bars have been assessed for condition by a certification authority (such as the Professional Coin Grading Service), they are generally classified as “collectibles” by the IRS and are therefore not allowed in IRAs. Once you’ve opened a self-employed gold IRA, you can transfer cash to the account to fund your purchase of physical gold. You can also convert your 401 (k) into a self-directed IRA, where you can then invest directly in gold bars and coins, subject to the permitted conditions.
The IRS does not allow popular gold coins such as the South African Krugerrand or British sovereign coins to be stored in a gold IRA. Gold IRA rules require that you store eligible precious metals with a national depositary, bank, or IRS-approved trustee. Your custodian bank can refer you to an approved institution and process the gold transfer as part of setting up your Gold IRA. Not all gold is IRA-approved gold, so it’s important to work with a well-rated gold IRA company like Noble Gold Investments when opening a Gold IRA account.
