What is A Gold Based IRA?

If you’ve done any investing, I bet that you’ve come across something called a gold IRA or gold-based IRA. These are IRA accounts that work by holding precious metals for you, and in doing so, you can use them as an investment vehicle.

That’s why, today, I’ll be breaking down gold based IRA accounts for you. Not only can they be great for your retirement, but they can also be a great hedge against things like inflation. Not only will I show you how they work, but I’ll show you why you should consider an account like a gold-based IRA for your retirement.

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I’ll break everything down into easy-to-read sections, this way you can jump around to whichever information you need when you need to. I know that some of you may know more than others, so here is a look at what I’ll be going over:

  • What is a gold-based IRA
  • The regulations of a gold-based IRA
  • The benefits of a gold-based IRA
  • Final thoughts

Now that you know what I’ll be going over, let’s dive right into the details.

What is a gold-based IRA?

I’m sure that most of you know what traditional IRA accounts are, but have you ever heard of a gold-based IRA? If you haven’t, this is definitely a section you’ll want to brush up before moving any further. Let’s take a look.

What is a Gold based IRA account?

Gold-based IRA accounts are precious metals IRAs that are referred to as gold IRAs. These accounts are designed to hold IRS approved materials like bullion, bars, and other valuable gold holdings. This is how a gold IRA account holds value, and how it works in a tax-deferred way.

How to invest in a gold-based IRA

Investing in a gold-based IRA is almost as simple as investing in any other type of IRA. The main difference here is that gold-based IRA accounts tend to be self-directed IRA accounts, which means that you’ll need to use a trust or custodian to manage the bullion for you. This is due to the fact that you can’t physically hold gold yourself, so you need a middleman man to store the funds for you.

Think of a custodian as a firm that holds money for you when you can’t yourself, almost like a financial advisor.

Once you find a custodian, you’ll need a broker to purchase the actual gold bullion or bars. There are plenty of brokers out there, but always be sure to check for the top-ranked firms. You also have two options when it comes to investing in a gold-based IRA, and both aren’t extremely complicated.

The first method is to utilize a 401k rollover into a gold-based IRA. This is when you take some of your own funds and roll them into a gold-based IRA. To accomplish this, you’ll need to find a broker and custodian. Then, once you know where you’ll be investing, you’ll need to contact the firm that has your 401k. From there, the process is as simple as signing a few pieces of paper.

Even if your 401k is held through your employer, you should still be able to view and contact the firm holding the funds. If you don’t have access to this information, I would recommend reaching out to your employer.

The second method is to use cash on hand to invest in gold. This method is simple, and all it takes is you visiting a firm. Keep in mind that some firms will require a minimum investment, and these can range between $100 up to $10,000. So, always be sure to shop around for one you like.

The regulations

Before I jump right into the benefits of a gold-based IRA, I want to spend some time going over how this is all regulated. So, let’s have a look.

IRS approved holdings

The first thing you need to keep in mind is that the IRS has several locations that are approved for gold holdings. This means that you’ll need to store your gold in one of these locations, because if you don’t there can be some serious penalties and fines.

If this is concerning you, don’t panic, because a good gold IRA firm can help.

Custodians and trusts

A gold-based IRA is a self-directed account, which means that it requires manual management. This is due to the fact that gold will be a physical asset, and it’s not something that you can exactly keep in your home or vault. This is why a custodian or trust is necessary because the IRS requires that you don’t hold the gold yourself.

You’ll still own everything, and have the rights to the accounts, it’s just that someone else has to manage it for you.

The benefits of a gold-based IRA

A gold-based IRA comes with a lot of different benefits, and all of them are definitely helpful. Protecting your money, and using it to create wealth should always be a priority. So, in this section, I’ll go over a few key reasons as to why gold can be a great asset for you.

Portfolio diversity

When it comes to investing, you’ve probably heard all about diversifying your portfolio. Everyone talks about it, and to be blunt, it’s preached for a reason. This is due to the fact that making sure you spread your money out across different assets can help protect it in case of a market collapse.

Since gold works against the dollar, and increases when the dollar decreases, gold is a great way to make sure some of your wealth is safe.


An IRA account is designed for retirement. They have tax benefits that make them very desirable, and they can make sure your wealth grows without being touched. Gold is a great asset to invest in for your retirement, and the withdrawal process is the same.

Hedge against inflation

A gold-based IRA can also be used as a great hedge against inflation. Remember when I said gold grows when the dollar regresses? Well, this is exactly what makes gold a fantastic tool to work against inflation. If the dollar loses value over time, the value of your gold will go up. Makes sense, right?

These are just a few benefits of a gold-based IRA. Depending on what you’re looking to accomplish, I’m sure gold can help.

Final Thoughts

I know that I went over a lot, but a gold-based IRA is not an account or investment that you should take lightly. This is an investment vehicle that you should carefully consider because it can preserve and grow your wealth. So, if a gold IRA is something you haven’t yet considered, now might be a great time.

A gold-based IRA is a great way to diversify your portfolio, protect your retirement, and even prevent inflation from eroding your funds away. While it may seem like it’s a stretch, trust me, a gold-based IRA is easy to get started.

Now that you know the facts, and how gold based IRA accounts work, what will you do?

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