Gold IRAs have higher maintenance fees than other types of IRAs, which is due to the additional costs associated with investing in gold. In addition to brokerage fees and account setup fees, the investor must pay additional costs to store and insure the precious metal. Rules against holding collectibles Tax legislation prohibits IRA holders from investing in life insurance, S corporation stocks, or collectibles. Some types of gold coins are classed as collectibles and would break the rules
.
What’s confusing and frustrating is that some gold coins and gold bars are allowed, but others aren’t. And it’s not like the IRS keeps a master list of what’s allowed and what isn’t. Understanding the pros and cons of gold IRAs can help you decide whether they’re the right choice for your personal retirement plan. A good Gold IRA firm will help you with the paperwork and will be available as your personal resource even after you complete your purchase (what is known as a “trade”)
.
Still, many people have decided that a gold IRA is an important part of their plan to retire as planned, and when you examine the benefits of this attractive asset, it’s easy to see why. To invest in gold via a gold IRA, an investor must first open a self-directed IRA (SDIRA) that can manage gold. If you’ve already saved money from your employer in a standard IRA, you can easily transfer it to a precious metals IRA with the help of a precious metals IRA provider. Of course, depositories don’t work for free, and you’ll have to pay storage and management fees for your Gold IRA
.
A certified financial planner may be able to give you viable suggestions on how to best incorporate a gold IRA into your strategy and plan, but the final decision is up to you. Storing gold in an IRA offers tax benefits, but a physical asset doesn’t take advantage of the tax-free growth aspects of IRA investments. You can set up the SDIRA either as a traditional IRA (tax-deductible contributions) or as a Roth IRA (tax-free distributions). Gold IRA companies work with specialized custodian managers and precious metals warehouses, and they’ve usually already reviewed options and identified preferred companies and institutions that they
recommend.
Those considering a gold IRA must also have the time and knowledge to make good decisions about their SDIRA. If this is the only IRA account or if there isn’t enough liquidity in the other accounts, you’ll also need to have some of the gold sold to raise the money to produce the RMD. If you suddenly need gold to exchange for food, you’d need to call your custodian manager first and fill out the necessary paperwork to get your own gold. I believe the idea behind storing gold or silver in a Roth IRA is to create a tax haven against such an egregious move by the government
.
People who want to invest in gold but don’t want to bother setting up a gold IRA have other options.
