A Guide to Purchase Precious Metals With an IRA

Investment in precious metals such as gold and silver are an effective way to diversify your retirement portfolio and protect it against inflation or economic uncertainties. We will walk through how to purchase gold or silver assets for an IRA.

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Understanding Precious Metals IRA

Before diving into purchasing gold and silver, it's vitally important to comprehend what a Precious Metals IRA entails. Traditional and Roth IRAs allow investors to invest in stocks, bonds, mutual funds and mutuals funds while Precious Metals IRAs allow self-directed investing with physical precious metal coins or bullions as investments.

Eligible Metals

Not all gold and silver products qualify for inclusion in an Individual Retirement Account (IRA), according to IRS standards for purity; gold must meet these guidelines (0.995+ for gold; 0.999+ for silver) before becoming an investment candidate in your IRA account. Common examples of eligible coins are American Gold Eagle coins; Canadian Gold Maple Leave coins as well as the American Silver Eagle coin that also meets these specifications (American Silver Eagle /Canadian Silver Maple Leaf coins are among others).

Establish a Precious Metals IRA

  • Select a Custodian: Due to IRS restrictions preventing individuals from keeping physical gold or silver within an IRA at home, a custodian will be necessary to set up and manage your Precious Metals IRA successfully. Custodians typically include banks, credit unions, trust companies or brokerage firms approved by the IRS as your precious Metals IRA administrator.

  • Create an Account: After choosing a custodian, the next step should be opening your self-directed IRA account. This involves providing personal and beneficiary designation information as well as making an initial deposit into it.

  • Fund Your Precious Metals IRA: Once the account has been opened, funds can either be moved from an existing IRA account or made directly.

Finding Reputable Gold and Silver Dealers

Once your Precious Metals IRA funds have been invested in precious metals, selecting an approved precious metals dealer is critical for successful investing. Make sure they offer competitive prices, offer eligible products at reasonable costs, and have proven track records for providing reliable services.

  • Select Your Metals: Carefully choose gold and silver products you wish to include in your IRA that meet IRS purity requirements and qualify as approved forms of metal.

  • Start Shopping: To purchase metals using funds from your IRA account, notify your custodian that you intend to buy. They will work closely with the dealer in completing your purchase using funds from that account.

  • Storing Your Precious Metals: Once purchased, physical gold and silver must be stored safely within an approved depository - typically handled by your custodian - which offers guaranteed depositories with high security measures to safeguard the investment of precious metals investments.

While investing in gold and silver may provide a suitable diversification strategy, investors must proceed carefully when entering this asset class. Precious metals may be volatile investments; therefore, it's crucial not to overconcentrate retirement savings into one asset class alone.

Conclusion

Gold and silver investments can provide an effective hedge against inflation while diversifying your retirement portfolio. By understanding the rules pertaining to Precious Metals IRAs and carefully choosing an administrator and dealer, these tangible assets can easily become part of your retirement strategy. As with any investment decision, however, consult a financial adviser first to make decisions that align with long term financial goals.