Should I Have Gold in My IRA?

Should I have gold in my IRA

Addition of precious metals to an IRA follows the same rules as investing in any other investment: contributions and withdrawals may be subject to taxes on income as well as penalties that may apply.

Investors cannot store metals themselves; rather, they should utilize an established custodian or metals dealer for this service.

Investing in Precious Metals

Precious metals make an appealing investment choice for many reasons, including providing a secure and diversified asset, tangible investment opportunity and protection from inflation, currency devaluation and market instability.

Gold is unlike stocks or mutual funds in that its value does not fluctuate with economic or political uncertainty; instead, its supply and demand determine its rise or fall in price.

An Individual Retirement Account, or IRA, can be opened quickly and effortlessly – similar to opening any tax-advantaged retirement account. Your money from any of your 401(k), 403(b), 457, pension or Thrift Savings Plan accounts can be easily moved into a precious metals IRA without incurring taxes or penalties.

Gold offers immediate liquidity and comes without withdrawal fees that require long-term commitment or high fees, plus it gives you privacy that other assets don’t provide; especially important when every transaction can be tracked and recorded.


Before investing in precious metals, it is crucial to fully comprehend their tax ramifications. According to the Internal Revenue Service (IRS), gold and other precious metals are classified as collectibles or investment property by the IRS – assets which gain value based on changes in overall market prices without your intervention or effort required; gains from such investments tend to be taxed at a higher rate than “ordinary” income gains.

Physical gold investments typically attract a 28% long-term capital gains (LTCG) tax rate while those related to stocks or other forms of ordinary income typically pay between 15%-20% LTCG rates.

As Lucas can attest, investing in precious metals through an IRA and other tax-deferred accounts such as SIMPLE IRAs or SEP IRAs is an intelligent choice. His annualized after-tax return increased by over 3.2 percentage points when using an IRA rather than brokerage for his mutual fund investments and by over four percentage points when purchasing physical gold coins.

Investing in Gold

Many people view gold as an economic safe haven. Although that may be true in part, investing in precious metals through an individual retirement account (IRA) that allows investors to manage alternative assets can also help you build wealth for retirement. A similar solution exists with solo 401(k) plans or health savings accounts which enable users to invest directly into them.

However, investing in physical precious metals through your IRA may incur high expenses such as storage, custodian fees and dealer transaction costs. Furthermore, precious metals are non-liquid investments, meaning it could be more challenging for you to meet required minimum distributions should that become necessary. Those looking for more liquid options might benefit from establishing a checkbook control self-directed IRA which reduces associated fees but has its own set of rules and requirements that you will need to meet before opening one of these accounts.

Investing in Silver

Silver can make an ideal investment choice for several reasons. One such reason is that its movements often mirror those of the stock market; secondly, silver serves as a safe-haven asset that typically increases when dollars and other fiat currencies lose value.

Silver is unlike company stocks or real estate; you can hold physical bullion bars from 1 ounce to 100 ounces as well as collectable coins produced by the U.S. Mint such as American Eagles.

Investors may opt to invest in silver ETFs or mutual funds; however, this strategy involves greater risk. Furthermore, fees associated with ETFs often erode their underlying bullion value. Another potential drawback in investing in silver futures contracts may not guarantee ownership – instead they simply offer investors an option to purchase or sell an asset at a set price at some future date.

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