The overwhelming majority of Americans have their life savings in retirement accounts, most commonly 401(k)s and traditional and Roth IRAs. While these mainstream retirement accounts equip investors with tax deferred growth, they place strict limitations on the asset you can hold. In turn, these restrictions greatly limit the diversification that can be achieved within your nest egg, unnecessarily exposing you to inevitable economic turmoil.
If you’re looking to diversify with precious metals to reinforce your retirement savings, this barrier becomes more than just a nuisance; it becomes a liability. You might consider opening up a gold and silver IRA to access the benefits of precious metals diversification and tax deferred growth.
Why Open a Gold and Silver IRA: 10 Wealth-Preserving Reasons
1. You can invest in physical coins and bars.
The most obvious motivation for investors to open gold and silver IRA accounts is to incorporate physical precious metals in their retirement plans. While you’re free to purchase bullion bars, investment-grade coins, and other forms of physical metals independent of an IRA, you’re forgoing significant tax advantages that come with retirement accounts. A precious metals IRA allows you to purchase gold, silver, platinum, and palladium within the context of a retirement plan, offering tax deferred growth and diversification with precious metals.
2. They provide greater control.
In contrast to 401(k)s, traditional and Roth IRAs, and other mainstream retirement plans, gold and silver IRA accounts give investors greater control over their investment choices. A self-directed IRA puts you in the driver’s seat when it comes to organizing, planning, and choosing your retirement investments. With traditional paper investments such as stocks or bonds, your nest egg is exposed to counterparty risk which can come in the form of bank collapses, aggressive rate hikes, or even mismanagement – just to name a few. A precious metal IRA can guard your wealth against volatility and economic risk.
3. Your nest egg is truly diverse (unlike paper assets).
Portfolio diversification is a widely understood component of a sturdy, optimized, and well balanced retirement account. Unfortunately, many investors still fail to achieve a truly diversified portfolio due to a reliance on paper assets. Even attempts to diversify by investing in gold ETFs, gold mutual funds, or gold mining stocks will still not give you the benfits that physical gold and silver will. These assets only offer indirect exposure to the gold market and are subject to significant manipulation from institutional investors. Through gold and silver retirement accounts, investors achieve true diversification with the inclusion of physical metals into their nest eggs. These tangible, hard assets aren’t subject to the same volatility or risks as their paper counterparts which means your retirement savings is better positioned to ride out the economic waves, keeping you afloat no matter what the market brings your way.
A lot of people are not trusting the government, the Federal Reserve, or the banks. They want to take possession of some of their savings and retirement.
–Precious Metals Advisor Todd Graf
4. The setup process is easy.
The unique structure of a precious metals IRA lead many investors to incorrectly assume that these accounts are challenging, time-consuming, and expensive to set up. In reality, setting up a precious metals IRA is as straightforward as establishing any retirement account. You can roll over funds from another retirement plan or set up an account from scratch. Once funding is established, you’ll choose a custodian to securely store your physical investments. The next phase is choosing the actual bars or coins you want to add to your nest egg. It’s that simple.
A Precious Metals Advisor can streamline this setup process by taking the guesswork out of the process and assisting with paperwork, all while helping you prepare your specific investment goals.
5. You’ll spend less money.
Gold and silver IRA accounts aren’t only easy to set up, they’re also affordable to maintain. The upfront costs of establishing a precious metals IRA are as low as a hundred dollars with annual account fees as low as $100. Even the storage expenses which protect your precious metal investments can be reasonable at anywhere from $50 to $300.
6. You don’t have to cash out.
There’s no way to get around taking RMDs without incurring tax penalties, but you can avoid having to cash out from a gold and silver IRA. Through these self-directed accounts, you’re allowed to make in-kind distributions which means you’re getting the value of the RMD in the form of physical metals instead of transferring them into cash. You’re meeting the withdrawal requirements while keeping your investments in physical gold or silver. Other mainstream investments force you to cash out when making an RMD, re-exposing your wealth to the pitfalls of fiat currency.
7. Most retirement accounts are limited.
The standard class of retirement accounts, such as 401(k)s, Solo 401(k)s, Traditional and Roth IRAs, and SEP IRAs, generally restrict investors to paper assets. Building a nest egg solely on ETFs, mutual funds, and single stocks increases volatility and risk as these assets are all subject to the strength of the economy, financial system and fiat currency. With a gold and silver IRA, you can properly diversify your retirement savings to weather all kinds of economic climates. Precious metals have inherent value that have steadily increased over the long run.
8. They hedge against inflation, stock market downturns, bank collapses, and other financial crises.
Investors across the board are losing faith in traditional, paper-backed assets as the economy faces immense pressure. The government allows inflation to run amok, the stock market suffers from precipitous drops, and the banking system stands on the verge of collapse. In the midst of widespread instability, investors are seeking out the protection, stability, and reliability offered by precious metals. With a gold and silver IRA, you’re hedging your nest egg against economic failures as precious metals tend to increase in value as traditional markets lose value.
9. You have greater privacy.
Federal mismanagement isn’t the only thing scaring investors away from traditional markets and paper-backed assets. Overt government overreach has been on an aggressive increase over the past few years as corrupt leaders seek to exert more power through financial control. For example, Canadian Prime Minister Justin Trudeau cracked down on growing protests by freezing hundreds of bank accounts of protestors and donors. The rollout of Executive Order 14067 which is exploring the creation of a Central Bank Digital Currency has raised concerns in the US. Gold and silver IRA accounts offer greater protection and privacy for investors looking to secure their assets against government corruption.
10. They open you up to more than gold and silver.
Despite being commonly referred to as gold and silver IRAs, self-directed accounts expose investors to more than just gold and silver assets. As mentioned before, you can invest in gold, silver, platinum, and palladium through a precious metals IRA. On top of that, several different kinds of metal assets are permitted including bullion coins, rounds and bars. Each of these metal types offers specific advantages which can create a properly diversified portfolio for optimized performance through the unavoidable highs and lows of the market.
Keep in mind that the IRS does place some restrictions on eligible precious metals for IRAs. A Precious Metals Advisor can help you determine which assets are permitted for your retirement account.
Are gold and silver IRA accounts a good idea?
As with all investments, the merit of a gold and silver IRA is dependent upon each investor’s unique goals. If you’re looking for a way to diversify your nest egg with physical gold and silver as well as see tax deferred growth, this type of retirement account is a fantastic choice. The best way to determine if a gold and silver IRA is right for you is to speak with an experienced Precious Metals Advisor.