A gold IRA is a type of self-directed IRA that allows you to invest in gold bars for retirement. In a regular IRA, you can’t own physical gold, although you can invest in a wide variety of assets that are invested in gold, such as gold stocks or gold ETFs. A precious metals IRA is an individual retirement account that allows you to invest in physical metals. They are sometimes referred to as gold IRAs, but silver, platinum, and palladium can also be purchased through these accounts
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Numismatic coins pay higher commissions to the gold company, but gold bars reflect the spot price of the precious metal more directly. Moy, chief strategist at Fortress Gold, who, as former director of the United States Mint, oversaw the largest production of gold and silver coins in the world. The ability to use gold and other materials as securities in an IRA was introduced by Congress in 1997, says Edmund C. The term gold IRA is primarily used to describe a self-directed IRA whose funds are invested in
hard metals.
Since precious metals are an alternative investment, opening a gold or precious metal IRA is a more complex process than setting up a regular IRA. Since IRA owners are required to accept distributions when they reach 73 years of age, they could be forced to sell gold at a lower price than they would like. You can buy gold and precious metals directly, but with an IRA, those saving for retirement can get valuable tax benefits. Although investments in collectibles are not allowed under IRAs and qualified plans, there is a spin-off that allows investments in specific coins as well as in gold bars that meet specific fineness requirements
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These investments are available in a normal brokerage IRA, meaning you wouldn’t have to go through the work and additional costs of setting up a self-directed gold IRA. The IRS does not allow popular gold coins such as the South African Krugerrand or British state coins to be stored in a gold IRA. This is in contrast to the more common assets that regular IRAs are limited to, such as cash, stocks, and bonds. Gold is generally regarded as a hedge against inflation and allows investors to diversify their portfolios.
The rules for withdrawing from a Gold IRA are similar to other individual retirement accounts. If gold seems like a good choice for you, Sentell suggests investing no more than a third of your retirement savings in a gold IRA. But if history is any guide, gold will have to travel a long way to reach the returns of the overall economy as measured by the broad markets
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