There are a few gold IRA rules that go along with opening a gold IRA, and we’ll go over a few that stand out. You are not alone if you have begun to consider investing in a gold IRA.
The value of gold has skyrocketed over the last decade, while the value of many currencies has dropped.
Opening, transferring or rolling over an established account is not difficult. However, there are some rules to follow to receive the tax benefits of an IRA and to stay within the policies of most custodians.
Only certain kinds of gold investments are permitted in a gold IRA. Until 2007, a person could only have physical gold as a part of his or her precious metals retirement portfolio.
Even that permission was restricted to certain types of coins issued by the United States and a few other countries as well as some bars of gold. A ruling from the IRS permitted the inclusion of additional types of gold investments.
As for coins, a number of the coins that an IRA can hold include American Eagle coins, Canadian Maple Leafs, Austrian Philharmonic, Australian Kangaroos and Pamp Suisse and Credit Suisse bars. In addition, uncirculated US Buffalo Gold coins are also permitted.
Bars of gold must originate with certain accredited manufacturers. A handful of these include LME, Nymex, LBMA and ISE-9000. These bars must contain a minimum purity of .995.
There are also a few other options with silver, platinum and palladium coins, bars and rounds which are also permissible in a precious metals IRA.
Due to the ruling in 2007, it is also permissible for IRA custodians to invest money from their accounts in exchange-traded gold funds.
Only a certain number of trustees or custodians are qualified for handling retirement accounts that carry physical gold and other precious metals. If you have not yet started an IRA, then you will need to seek out a custodian that will permit these types of investments. Among them are companies such as Sterling Trust, GoldStar and the Entrust Group. Precious metal brokers who handle precious metals IRAs also can take care if this for you, or recommend a custodian if you haven’t one selected.
If you are a present owner of an IRA, then you will need to either transfer your account or perform a rollover. Transfers are permissible with IRAs at any time. This transaction simply moves the money in one IRA account with one custodian to another account with a different custodian. The original trustee only needs to write a check for the funds to the receiving trustee.
An alternative way of carrying this out is through the Gold IRA rollover option. You request and receive the funds from your original custodian. Then you redeposit the funds into the second fund that utilizes gold investments. As long as you carry out the reinvestment in less than 60 days, you can avoid taxation on this money as well as withdrawal penalties. This can only be done once per year with any individual’s retirement funds.
You may want to sink a lot of money into gold as a result of seeing how well it has performed over the last few years. However, an IRA has tight restrictions on maximum contributions. At present, you can only contribute $5,000 per year into such an account and it must be paid in cash. The only exception to this is, of course, when you transfer or rollover funds into a new IRA.
Switching over to a gold IRA may seem like a dramatic move. You will soon see that this means dramatic gains. In fact, sticking with your present IRA, and with the way the markets have been acting appears that it could turn out to be a dramatic loss, without some added diversification.
Gold has made exponential gains in the last decade while stocks have barely moved from their highs earlier in the decade. The DOW Jones Industrial Average passed 10,000 near the turn of the century. It has only gained 30% since then. Gold is worth five times as much as it was in 2002. If you want your retirement to be truly comfortable, you’ll want to consider investing a percentage of your retirement funds into gold and a gold IRA is a nice way to go about this.
If you want to learn more, there are some really great Gold IRA informational portals, such as IRA Investing, that provide a variety of information regarding gold IRAs, including the benefits and drawbacks of this investment tool. If you are interested in learning more about gold IRAs, visit the site today.