Precious Metals IRA Explained
Throughout your journey of finding out how to invest in your retirement, you may have come across the term Precious Metals IRA. There are many different types of IRA accounts you can invest in, and a Precious Metals IRA is just one of them. However, there are many rules and ins and outs of them and, before taking the next step in investing, it is important to know exactly what they are and how they work. Keep reading to learn more about Precious Metals IRAs and all the important rules to know.
What Are Precious Metals?
Precious metals are metals that are rare and have a high economic value, due to various factors, including their scarcity, use in industrial processes, and role throughout history as a store of value, according to Investopedia. The most popular precious metals with investors are gold, platinum, and silver.
Investing in precious metals works as a portfolio diversifier and as a hedge against inflation, protecting your other savings. This works in three ways:
- Value of the dollar decreasing: When the value of the dollar begins to go down, banks are perceived as unstable, or the government is seen as unstable, the value of gold and precious metals go up.
- Inflation. This is when there is a decrease in the purchasing power of money, reflected in a general increase in the prices of goods and services in an economy. When this happens, the value of precious metals rises.
- War and political upheaval. Precious metals can be stored and made portable, making them something people tend to hoard during times of political uncertainty.
What Is An IRA?
IRA stands for Individual Retirement Account. An individual retirement account is a tax-advantaged account that individuals use to save and invest for retirement. The Internal Revenue Service (IRS) also uses the term individual retirement arrangements (also IRAs) to broadly refer to individual retirement accounts, individual retirement annuities, and other trusts and custodial accounts that act as personal savings plans with tax advantages for setting aside money for retirement.
There are several different types of IRA accounts, all of which have their own rules. They include:
- Traditional IRAs: This type of IRA puts pre-tax income toward investments that can grow tax-deferred.
- Roth IRAs. Roth IRAs allow qualified withdrawals on a tax-free basis and are very similar to traditional IRAs.
- SEP IRAs. The employer is allowed a tax deduction for contributions made to a SEP IRA and makes contributions to each eligible employee’s plan on a discretionary basis.
- SIMPLE IRAs. This is a retirement savings plan that most small businesses with 100 or fewer employees can use.
How Does a Precious Metals IRA Work?
Precious metals can be used in an IRA account. Precious Metals IRAs are self-directed individual retirement accounts that often come with higher fees than a traditional or Roth IRA. When used alongside other traditional or Roth IRA accounts that invest solely in stocks, bonds, and mutual funds, a Precious Metals IRA will work as a hedge against inflation and protect the rest of your portfolio.
Rules regarding Precious Metals IRA accounts:
- You can set up a brand new Precious Metals IRA account, or transfer your existing IRA over to one.
- Your precious metals must be held by an IRA custodian or trust company. Some of the responsibilities of a custodian include the initial account setup, producing account statements, and accepting contributions.
- You will most likely never get to meet the precious metals you have in your IRA, as they must be stored in an IRS-approved depository. Any precious metals you purchase through a dealer will be shipped to this depository.
- A precious metals IRA owner may liquidate at any time.
Stashing gold coins and bullion isn’t an option when it comes to Precious Metals IRAs. While that is one of the many ways you can collect and save precious metals, the IRA route has many rules and regulations. The precious metals have to be traced from beginning to end, so existing precious metals cannot be placed into them.
By rolling over your IRA, 401(k), 403, TSP, or 457 Plan into our Precious Metal IRA Account, you can achieve the same profits that you would gain by purchasing gold or silver directly, while also enjoying the benefits that your retirement account provides.
About Priority Gold
The first step to getting a Precious Metals IRA account set up is to choose the IRA account custodian. If you are ready to invest in gold to protect your savings and secure your future, we can help. Priority Gold is one of the most trusted precious metals dealers in the United States with BBB A+ Rating, AAA Rating with Business Consumer Alliance, and 5 Stars Rating with TrustLink.
We specialize in providing precious metals investment services with Security, Liability, and Great Convenience for customers. Our team is committed to helping to streamline their precious metals purchases at a fair price, selecting the right precious metals portfolios, and meeting their important financial objectives.
We offer Free Storage for qualifying Gold & Silver IRA accounts, a fast & easy gold buying process, and smooth IRA Transfer. And gold shows up on schedule. Priority Gold guarantees the highest standards of customer service, which comes with honesty, professional conduct, and the Ethical Code of Business.
For more information, visit us at prioritygold.com