How to Buy Gold in an IRA

Finance | Retirement | Gold IRA | Article By: eBackers Staff Writers – 18th April, 2020

IRA accounts are a great way to make sure that you retire comfortably. They have plenty of tax benefits, and you can even use them to turn your wealth into more wealth. Now, while this may be the case, considering the benefits of a gold IRA is definitely a great idea.

Today, I’m going to go over what the process of buying gold in an IRA will look and feel like. This way, if buying gold seems like a good idea to you, you can go into the buying process with the confidence and knowledge that you need to succeed.

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I’ll be breaking everything down into nice and easy to read sections. This way, you can feel free to jump around from topic to topic if you ever need to. Here is a quick look at what I’ll be discussing:

  • The basics
  • Things to consider
  • Recap

Now, without wasting any precious time, let’s get right into the details.

The Basics
Buying gold in an IRA is going to take a lot of time and money. For example, you usually can’t throw a small amount of money into a Gold IRA. This is due to the fact that most gold companies will make sure that you invest between 5-10 thousand dollars. This means that you’ll either need to roll money over from another account or have some extra cash on hand.

Self-directed IRA

Once you know where the money will come from, you’ll need to create a self-directed IRA account. These accounts work like a regular IRA, except they’re a bit more hands-on. For example, you’ll need to work with someone called a custodian, which will be the one managing the account for you. 

Why a custodian? Because the IRS has regulations in place that either a trustee or custodian must be the one managing the account.

Broker

Once you have that taken care of, you’ll need to visit a brokerage firm to really get things started. Some firms will handle everything for you, and if you’re new to investing with gold, I would recommend looking for a firm that does this all for you.

These brokers will take your money and purchase the gold bullion you’re looking to store. They will designate where it will be stored, and when the time comes, they’ll handle your distributions as well.

Things to consider

Now, remember when I mentioned that you can either open it up with cash on hand or use a rollover? Well, this is something you’ll definitely need to consider. So, in this section, I’m going to spend some time on what the actual process will look like.

Cash on hand

If you’ll be buying your gold with cash on hand, the process is going to be a bit more simple. You’ll visit a brokerage firm, and from there, you’ll be able to make decisions based on what the broker recommends. Plus, you’ll be able to designate a custodian or trustee to manage the actual account for you.

Rollover

Now, if you don’t have the cash on hand to fund a gold IRA, you don’t need to panic. As I’ve mentioned a few times already, you can roll the money over into a gold IRA from other accounts.

The process is fairly simple, and as long as you speak with your investor, it should be as easy as sending some paperwork over. Now, while you usually can’t take money out of a 401k or IRA without a penalty, if you roll this money into another IRA you can move it around without penalties.

If you want to diversify your retirement, or even just use a gold IRA as another retirement account, a rollover might be the right choice for you.

Recap

Buying into a gold IRA might seem complicated, but at the end of the day, it’s really not that difficult. All you need to do is make sure that you find a broker that you trust and a custodian or trustee that can handle your needs.

I always recommend shopping around with other gold companies first. Why? Because it makes sure that you at least have some options. You never want to put all of your eggs in one basket, and when we’re talking about your money, going with the best option should always be your priority.

Now that I’ve gone over the facts, I hope that you understand what the process of buying gold looks like a little better.

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The owners of this website may be paid to recommend Goldco Direct. The content on this website, including any positive reviews of Goldco Direct and other reviews, may not be neutral or independent.

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Frequently Asked Questions

Can my IRA hold anything other than gold?

Yes. Your new precious metals IRA is self-directed, and you have the authority to invest into any assets that you want. You don’t have to just allocate your funds to gold and other precious metals, you can also put them into stocks, cash accounts, mutual funds, and more. There are also other gold related investment products that you can invest your funds into.

Can my existing IRA be rolled over?

Yes, funds from an existing IRA can be rolled over to a precious metals IRA and you can do this as often as you want without having to pay penalties or taxes. You will simply need to set up the new IRA and then authorize the transfer of funds. Typically, the custodian of your new IRA will handle this and will work with your existing custodian to work out the transfer of the funds. IRA rollovers are subject to time limits and other restrictions and you may have to report it to the IRS. In order to avoid complications, be sure to get tax advice before you start the rollover process. Also, you can invest in gold with your 401(k).

What is the difference between a traditional a self-directed IRA?

A traditional IRA is controlled by a custodian or trustee. You must allow them to direct your funds into investments that they deem to be worthy. A self-directed IRA is where you get to choose where your funds are invested. You don’t have to follow the decisions of a custodian or trustee. The main benefit of the self-directed IRA is that you get to choose from stocks, bonds, precious metals, mutual funds, CDs, or other IRA-compliant investments.

How can I invest my IRAs into precious metals?

As long as your IRA is self-directed, you can simply direct some of your funds into precious metals. Most commonly, you can invest in palladium, platinum, silver, or gold. However, you must know that any precious metal, whether it be in coin or bullion form, must meet certain requirements of purity and refinement.

Can my existing IRAs be used to invest in precious metals?

Typically, yes. However, the final decision is left to your current custodian or trustee.

Is it OK to have more than one IRA?

Yes. There is no limit on how many IRAs you can have at once, but there are limitations on the total amount you can invest annually into IRAs. In December 2011, if you were under 50, you can contribute up to $5,000 per year in all IRAs. If you were over 50, you can invest up to $6,000 per year.

What is an IRA?

An IRA, or Individual Retirement Account, is a savings plan for your retirement that has been designed specifically to provide tax advantages to individual investors such as tax-free or at least tax-deferred growth of earnings. There are several different types or IRA accounts- all of which have different rules that govern the mimimum withdrawal age, annual limits on contributions, and others. Most commonly, IRAs are used to supplement an employer’s 401(k) account and typically will be the majority of your investment portfolio.

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