How Do I Buy Gold Coins With an IRA?
Add precious metals to your retirement plan to diversify and protect it, finding a gold company with experience and excellent customer service to assist with choosing an IRA custodian, depository location and purchasing coins and bars eligible for an IRA account.
Investors looking to invest in precious metals must abide by certain IRS rules when investing in precious metals. The first step should be finding a dealer, custodian and depository (each will charge fees), with each offering different services at differing costs.
Find a Custodian
Step one in purchasing gold coins through an IRA involves finding an approved custodian. This could be any bank, brokerage firm or financial institution.
Many custodians have formed partnerships with precious-metals dealers or can recommend one. Investors also have the option to store their metals at depository of their choosing; however, this often incurs additional fees and paperwork requirements.
Gold IRA custodians typically charge account setup and maintenance fees, storage fees and markup on bullion purchased for clients. When choosing an IRA custodian, it’s wise to interview multiple candidates, ask for their fee breakdown and services details – this can be done online, over the phone or in-person – then select one to host your account with. Investors also have the option of taking in-kind delivery of precious metals with physical delivery; however this will incur additional shipping and insurance fees.
Select a Depository
Precious metals don’t produce dividends or interest payments, but their value may increase over time. You could use precious metals as part of a diversification strategy to lower your exposure to stocks and bonds; however, you should remember that an IRA-approved precious metals account requires special compliance rules that differ from a regular retirement savings account.
The IRS mandates that any precious metals held within an IRA be stored at an approved depository. Your custodian or you may choose one yourself that meets their criteria; taking physical possession would result in penalties and taxes being levied against it by the IRS.
Gold IRAs are becoming increasingly popular, yet you might also consider investing in silver and platinum as they each bring unique qualities that could add a lot to your retirement portfolio.
Purchase the Gold
Your custodian will be responsible for purchasing precious metals and storing them safely with an IRS-approved depository, such as a bank, credit union, trust company or brokerage firm approved by the Internal Revenue Service. However, they won’t offer any investment advice; many gold IRA companies can assist in finding one and creating a self-directed IRA to facilitate purchasing physical precious metals.
These types of IRAs tend to come with more fees than their traditional counterparts, including account setup and maintenance expenses, plus any markup costs related to purchasing precious metals which vary based on which product you select.
IRS rules strictly forbid you to purchase or store precious metals directly. Instead, your IRA custodian can arrange their purchase from merchants.
Withdraw the Money
As with any IRA account, before withdrawing precious metals from an IRA you should consult a CPA or tax professional. While precious metals accumulate without incurring tax liabilities while held within an IRA account, when withdrawing they could trigger taxes and penalties depending on your account type and age.
Launching a gold IRA requires more work and comes with associated fees that make investing in paper assets more cost-effective. A gold IRA requires finding and selecting a custodian, purchasing precious metals that comply with IRS rules and shipping them off to an IRS-approved depository for safekeeping. Although some dealers claim to charge no fees at all, annual maintenance, storage and insurance fees could still add up over time. To avoid hidden charges it’s wise to research each dealer thoroughly: track record, Better Business Bureau rating, industry membership status as well as price markups that differ among companies.
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