An IRA (Individual Retirement Account) offers excellent investment opportunities that can leave you with a comfortable nest egg.

As the time between now and liquidation is quite long, however, you have to be careful about where you put in your hard-earned money. It’s hard to predict what could happen. As the recent Great Recession has shown, a financial crisis can come with little notice and cost you your most precious assets.

Diversification is a good way to protect your investments. An investment in precious metals, in particular, is highly recommended, as the value of these commodities is fundamentally independent of the market factors that influence assets like stocks and bonds. In fact, historically, the value of precious metals rises with inflation.

Silver, in particular, has recently seen significant price increases, and is predicted to gain even more in the future. Given this, a Silver IRA makes a sound investment.

Starting a Silver IRA

In many cases, it is necessary to open a self-directed IRA where you can put in investments in silver and other precious metals like gold, platinum, and palladium. If your present IRA allows silver and other precious metal investments, then opening a separate Silver IRA account may not be necessary. This is rarely the case, however.

There are several important rules to remember in setting up a Silver IRA:

• The silver must be under the custodianship of your IRA trustee and stored in an IRS-approved storage facility, which you will select.

• Funds from other retirement accounts, including other IRAs, may be rolled over to a Silver IRA.
• You cannot include any silver asset that you already owned prior to opening the Silver IRA.
• You can only add silver assets that meet IRS eligibility standards.
• The silver assets that you add must be purchased by your IRA account through a recognized dealer.

Silver IRA eligibility standards

Only silver with a fineness of .999 (99.9%) or more may be added to a Silver IRA. This disqualifies pre-1965 or junk silver coins, which only have 90% fine silver.

The American Silver Eagles are among the most popular silver bullion coins invested in a Silver IRA. Investors looking for additional values such as an accelerated appreciation, buoyancy in a volatile market, and benefits when taking distributions should strongly consider exclusive assets out of the RCM such as Silver Polar Bear, Arctic Fox, and Polar Bear & Cubs, ask a Senior Partner why. Others include:

• Canadian Silver Maple Leaf Coin
• Royal Canadian Mint Wildlife Series Coins
• Mexican Silver Libertad Coin
• Austrian Silver Vienna Philharmonic Coin

Privately minted silver rounds and gold bars meeting the IRS’s fineness criteria may also be included in your Silver IRA.

Buying tips

Here are some pointers to consider when buying silver for your IRA:

• Backdated American Silver Eagles cost less than current issues, but contain the same amount of silver.
• Large silver bars, such as those sized at 100 oz or 1 kg cost lower per ounce compared to smaller-sized bars.
• Privately minted silver rounds and bars that meet the IRS’s eligibility requirements carry a lower premium over silver’s spot price compared to silver coins.

Benefits of a Silver IRA

In addition to hedging your investments and improving your long-term gains, a Silver IRA offers the same tax benefits as a regular IRA. If you have a traditional IRA, you can deduct your silver investments from your taxable income, and pay taxes only when you withdraw from the fund. Additionally, any sale of your silver assets is free of capital gains as long as you keep the money in your IRA.