Gold IRA Investments
A “Gold IRA” is nothing more than a term investment professionals use to describe an IRA that is invested in gold. To start such an IRA you will first need to set up one of following IRA’s that have been approved by the US federal government which are Roth, Traditional, SEP, or SIMPLE. There are essentially three different items you can purchase to start your gold investment program, which are coins, bullion, or ETFs; and each one has its own particular advantages and disadvantages.
An ETF is a fund that is run by professionals that invest in companies in the gold industry which could be a mining operation, jewelry manufacturer, or an organization that supplies equipment to the mining industry. Gold bullion is bought by weight in the form of bars and its purchase price is closely tied to the spot price of gold, plus a small premium, which is the seller’s profit.
Gold coins usually sell for more than the amount of gold bullion in them and they have more upside potential when compared to bullion. That being said, they all don’t increase in value, and in some cases the investors are forced to take a loss when they go to sell their coins and are only able to get the spot price for the gold that is contained within them. Gold coins can increase in value substantially over a period of time for many reasons and some of them are the coin itself, its rarity, the design of the coin, the artist that created the coin later became famous, demand, or it suddenly becomes highly desirable for a reason that was unknown when the investor purchased it.
Why you Should Think About Starting a Gold IRA
For many people, setting up a retirement savings program will be the most important financial decision they make in their entire lifetime. If you are very young, in your 20’s or 30’s, you can afford to take more risks that the average investor by purchasing highly speculative stocks.
As you get older and closer to retiring, you need to be more conservative when it comes to your retirement savings. A properly conceived gold investment plan is not only a hedge against inflation, it is also a safe harbor that the world turns to whenever there is a major crisis like a world war, recession, or a man made disaster like an oil embargo.
Whenever something like that happens, the price of gold almost invariably increases sharply until the event passes and everything calms down. Many investment experts call gold the “world’s most important currency” and, to a certain extent, their interpretation is correct.
Virtually every astute financial adviser will tell you that your long-term investment portfolio should be very well diversified for maximum protection. Almost all of them suggest that a portion of your investments should be in stocks, bonds, mutual funds, real estate, and commodities.
Besides everything we mentioned above, there are two other reasons you should think about starting a gold backed IRA.
- First, it is a commodity that cannot be manufactured by humans, whose supply is limited to the amount that is presently on the planet.
- Second, due to the vast improvement in the worldwide economy that has taken place over the last couple of decades, demand for gold has skyrocketed and that demand is only going to increase in the future. Of course, all of that means that gold investments do have a very bright future and they will almost assuredly see another sharp price increase in the next decade or so.
We recommend that you watch the following video, which illustrates the reasons for you to consider investing in gold:
The Advantages of Gold IRA Rollovers
A “gold IRA rollover” is nothing more than taking the funds or a portion of the funds you have accumulated in an IRA account and exchanging them for gold while setting up another IRA account. The IRS has very strict guidelines that must be followed to make sure you do not have to pay taxes on your prior investments appreciation, and so that you do not lose the tax advantages that an IRA provides its users.
It is highly recommended that you do not attempt such a rollover without professional advice. The advantages that this type of maneuver provides its users are rather obvious: You do not have to provide any additional funding to protect your other investments by placing a portion of them into gold. Once again, most professional investment advisers recommend that their clients have somewhere between 5% to 10% of their overall portfolio in gold, or in some other type of precious metal like silver or platinum.
How to Convert an IRA to a Gold Backed IRA
Converting any other type of IRA to a gold backed IRA is a relatively simple process if you use a company that has a great deal of experience in handling these types of complicated transactions. Once again, under no circumstance should an individual that does not have any expertise in this area attempt to rollover an IRA without professional help. If you are bound and determined to do this yourself in order to save a little money (by not having to pay the fees for a professional conversion), we strongly suggest you visit the IRS’s website and download the regulations pertaining to rolling over IRA’s.
How Do you Determine if a Gold IRA Company is Trustworthy?
When it comes to selecting a company to handle your investments, you do not have too much to worry about. All of these companies operate in a highly regulated industry and are audited each year by respectable accounting firms. If you are still a little bit concerned, you can always check out a company’s reputation by using the BBB website or by calling its state regulators to find out if there have been any complaints against it.
One other thing you can do to protect yourself is to choose a firm that has been in business for a very long time. After all, a company in this industry could not have stayed in business for 30 or 40 years if they were not supplying exceptional customer service and were engaging in unethical activities.
The Top 4 Questions You Should Be Asking Gold Investment Companies
Below we are going to discuss some of the things you need to be aware of before you select a company to start doing business with.
# 1 – IRA Setup Fees and Storage Fees – Regardless of which company you choose to handle your IRA, you will find that both the set up and storage fees will all be within a similar price range. If you happen to come across a firm that is either much more expensive or cheaper than any of their competitors, you should avoid it because there really is not an acceptable reason for this type of price variation.
# 2 – What Other Types of Precious Metals I Can Invest In? – As we mentioned previously, the two other types of precious metals you might want to consider using in your IRA are silver and platinum.
# 3 – Does the Company Have a Gold Buyback Program? – Hopefully, you never end up in a financial situation where you have to use the company that is maintaining your precious metal investments to buy back the gold you have placed in it. But, if you do, it is always nice to know that you can cash-out your account rather quickly.
# 4 – Is There a Difference Between Gold Coins and Bullion? – Yes, gold bullion and coins are priced differently as we explained earlier. If you would like to learn more about this subject, there is a ton of information on the internet that you can use to research this matter more thoroughly.
Our Top Choice – Regal Assets
Regal Assets is a firm that is based in Burbank (California) that has been in the gold business for over 50 years. In addition, they are also one of a few companies that are not only specialists in precious metal investments, but also sell gold bullion and coins, provide expert gold IRA investments advice, and even arrange for storage of their clients’ gold in IRS approved facilities.
Regal Assets is rated A+ by the Better Business Bureau (BBB), which is their highest rating. The Business Consumer Alliance (BCA) has also given them their highest rating, which is AAA. Trustlink, which is a website that allows people to write and post reviews about firms they have done business with in the past gives them 5-Stars, which also happens to be their highest rating.
Should You Invest in Gold?
Starting and planning out a retirement savings program is a highly personal decision that should not be taken lightly. Gold investments are not right for everybody, especially for very young people that have extremely high risk tolerance levels. That being said, if you want your retirement package to be as well protected as possible, it is highly advisable that you place somewhere between 5% to 10% of your overall investments into gold or some other type of precious metal.