Your retirement fund is one of your most precious assets, and should be closely safeguarded to ensure you enjoy your golden years without financial worries. This is why we highly recommend investing in physical gold and silver.

Over the years, gold and silver have provided effective portfolio diversification and served as a hedge against economic uncertainties. In times of high inflation or significant dollar devaluations, the value of gold and silver typically goes up.

While extreme government policies, political unrest, corporate mismanagement, natural disasters, and the like can all but wipe out the value of stocks, bonds and similar assets, the intrinsic value of gold, silver, and other precious metals remains intact and unaffected by these external factors.

How to invest in precious metals

If you want to add gold, silver, and other precious metals to your retirement investment portfolio, consider opening a Gold or Precious Metals IRA. This is a self-directed IRA where you can hold physical gold, silver, and other precious metals – something you can’t do with a conventional IRA.

A self-directed IRA allows you to invest in a broad range of assets in addition to stocks, bonds, and mutual funds. These investments include real estate, tax lien certificates, private placements, and precious metals.

Tax benefits

As with a conventional IRA, a self-directed IRA may be either traditional or ROTH.

In a traditional self-directed IRA, your investments are tax deductible and can grow tax-free until you take a distribution. Any profit or income you make from an asset or its sale is free from capital gains and other taxes as long as you keep the money within the IRA.

Taxes will be computed and applied when you take a distribution, which can start when you reach the age of 59.5 years (voluntary distribution). When you reach the age of 70.5, you will need to take required minimum distributions (RMD).

In a ROTH self-directed IRA, you can pay for taxes now and enjoy tax-free distributions when you reach the age of 59.5 (for voluntary distributions) or 70.5 (for RMDs).

How does a self-directed IRA work?

The following are the steps in opening a self-directed IRA:

1. Establish an account with a trustee or a custodian, usually a bank, a loan association, a brokerage firm, or any other entity approved by the IRS.
2. Fund your IRA account. The most common funding method is a 401k or conventional IRA rollover or transfer.
3. Instruct the trustee to purchase your IRA investments.
4. Keep any profit or income generated by an IRA asset within the account. Otherwise, the money will be treated as an early distribution, with corresponding taxes and penalties.

The trustee or custodian keeps a record of all your IRA transactions, including expenses and payments made, and profits earned from an asset’s sale or income.

How does a Precious Metals self-directed IRA work?

If you are adding gold, silver, or other precious metals to your self-directed IRA, you need to comply with additional measures, as follows:

1. Identify a storage facility. You normally cannot store physical gold or silver at home or any personal property. The metals can only be stored in an IRS-approved facility.
2. Instruct your IRA trustee or custodian to purchase the metals from your designated broker. In many cases, brokers can refer you to IRA custodians, or custodians may recommend certain brokers to you.
3. You cannot add gold or silver assets that you previously own, or purchase the assets yourself and add them to your IRA. The purchase has to be a transaction between your IRA custodian and the precious metals broker.