Have you heard people talking about the benefits of setting up a Gold IRA? If you don't have a lot of experience investing in precious metals, you may be a bit confused by what you're hearing. Gold IRAs have a lot to offer, which is why many financial experts recommend using them to diversify your investment portfolio. However, until you truly understand these benefits and how Gold IRAs work, you won't be able to determine whether setting up one is the right fit for your financial goals.
Today, we're going to help you answer all the questions you may have about Gold IRAs and share some reasons why you might want to set one up to secure a comfortable retirement. We'll also share our picks for the five best Gold IRA companies that will be able to help you open your new account. Keep reading to learn more and make an informed decision.
What is a Gold IRA?
Self-Directed IRAs were created to give individuals more flexibility with how and where they invest their money for retirement. Rather than mandating that retirement funds be invested in stocks and bonds, individuals can invest in alternative assets.
Gold IRAs are one form of Self-Directed IRA that allow individuals to hold gold, silver, and other precious metals in a retirement account. They offer the same tax-saving benefits associated with standard IRAs, where individuals can choose between either pre-taxed or tax-deferred account types. Here are some of the different Gold IRA types you can choose from:
With the exception of the SEP IRA, yearly contributions are limited to $6,000 for individuals under 50. Those 50 and older can contribute an addition $1,000, for a total of $7,000 per year. These contribution limits represent the maximum amount allowed over all retirement accounts, which means that you may need to split the maximum contribution if you have multiple IRAs.
What are the Benefits of Setting up a Gold IRA?
There are multiple benefits associated with investing in precious metals through a Gold IRA beyond the tax benefits we just shared. We've outlined several of these benefits below:
Diversification is probably one of the most important reasons to consider opening a Gold IRA. Diversification refers to having your investments spread out through different assets. When you hold some of your money in precious metals and some in the stock market, you are setting yourself up to be more secure against dips or drops with either investment. Should the stock market drop, only a percentage of your assets will be affected. Also, it is important to note that the value of precious metals often moves in the opposite direction of the stock market. This means that if the market is way down, the value of gold is likely to be increasing.
Investing in a Tangible Asset
When you invest in the stock market, you are investing in a company. You are not investing in anything that you can physically hold in your hands. If the company collapses, the value of your investment will disappear right along with it. With precious metals, on the other hand, you're investing in something tangible that you can physically hold. While the value of precious metals may fluctuate, it won't go to zero, or next to nothing, as is possible with some stocks.
As such highly coveted precious metals, the growth potential for gold and silver is quite high. While history is not guaranteed to repeat itself, the value of an ounce of gold was just about $200 in the year 2000. By 2017, the value of that same ounce of gold was more than $1,200.
Low Supply and High Demand
There are only limited quantities of precious metals on Earth. When you consider this low supply and how highly sought after these metals are, it makes sense that their value could continue to increase. As more uses in manufacturing, technology, and medicine are discovered for gold, silver, and other precious metals, one could predict that demand will only continue to increase.
Gold IRA Rollovers
A gold IRA rollover allows you to convert an existing retirement account into a new Gold IRA. Working with a Gold IRA custodian, you'll be able to move some or all of the funds from your current account into a Gold IRA. Once the funds have arrived with the Gold IRA company you're working with, you'll be able to select the coins and bars that you wish to hold in your account.
The rollover process is not too complex. However, there are strict rules from the IRS that must be followed to avoid taxes or penalties. For this reason, you'll want to work closely alongside a trusted Gold IRA company and Gold IRA custodian to rollover your existing account.
Eligible Account Types
Many existing retirement accounts will be eligible for a Gold IRA rollover. Some account types that might be eligible include traditional IRAs, Roth IRAs, SEP IRAs, TSPs, 401(k)s, 403(b)s, and 457(b)s.
Some employer-sponsored account types may not qualify for a rollover if you are still a current employee. This is because some employers and companies do not allow their current employees to complete a transfer or rollover.
If you are not certain whether your existing account is eligible for a rollover, reach out to one of the Gold IRA companies featured below. They can work with you and a Gold IRA custodian to determine eligibility and get the rollover process started if your account is eligible.
How Do You Set Up a Gold IRA?
If you're ready to set up a Gold IRA after reading about all the benefits we shared above, take a look at the next few sections. We'll share key information about the set-up process so you can know what to expect. Keep in mind that every company has their own set of procedures, but the information below can be used as a general overview of the process.
Select a Gold IRA Company to Work With
The first thing you'll need to decide before being able to set up a Gold IRA is to pick a Gold IRA company to work with. There are an abundance of companies out there, which can make it difficult to sift through the best and worst options. This is precisely why we included a list of our top-recommended companies in this article. We did the research for you to identify the best companies that are deserving of your trust and business.
The IRA company you work with will provide you with the required paperwork to open your new account. They'll be able to help you answer any questions that come up and assist you through the process of filling in the necessary forms.
Connect with a Gold IRA Custodian
Once you've determined which Gold IRA company you want to work with, you'll also need to choose a Gold IRA custodian. IRA custodians are the only individuals who will be able to transfer the funds from your existing IRA into your new Gold IRA.
If you don't already have a Gold IRA custodian picked out, the precious metals provider you're working with should be able to offer some recommendations. Some IRA companies even have a list of preferred custodians to share with their customers.
Fund Your Gold IRA
The Gold IRA custodian you've selected will be able to move the funds from your existing account into your new IRA account. This process should not be too involved, but again, there is the potential for fees or taxes if this step is not completed properly. This is why it is essential to work with experienced and reputable companies to make sure everything goes off without a hitch.
Select the Precious Metals to Hold in Your Account
Now that your account is set up and the funds have been transferred to the Gold IRA company you're working with, you will be able to select the precious metals you want to invest in. The selection of coins and bars will vary some depending on which company you work with, but all should offer several options for you to choose from. If you need suggestions or are unsure which coins and bars offer the best match for your investment needs, have a conversation with the precious metals advisor at the Gold IRA company.
Best Gold IRA Companies to Work With
Are you ready to learn more about the best Gold IRA companies? We've conducted a lot of research and closely examined dozens of companies to arrive at this list of our top recommendations. Continue reading to discover which company will best match your needs.
Out of all of the Gold IRA companies out there, there is none that we recommend as highly as Goldco. The company was founded by Trevor Gerszt in 2006 and has become a top name in the industry. One look at all the positive reviews from past customers, along with the superior ratings from the Better Business Bureau and Business Consumer Alliance, it should be clear that Goldco has a lot to offer customers in terms of top-notch customer service and exceptional products.
Opening a Gold IRA
Goldco has made it easy to open a Gold IRA. You can get the process started on the website by completing the interest form, or you can always contact the company if you'd prefer to speak with an agent. The member of the team you work with will assist you through the process and work alongside you and a Gold IRA custodian to ensure that the funds from your existing account safely make it over to your new account.
IRA-Approved Coins and Bars
All of the coins and bars listed below satisfy the minimum purity requirements laid out by the IRS. Any of them can be held in a Gold IRA you set up with Goldco. If you have questions about which coins or bars you want to hold in your account, don't hesitation to reach out to your account representative for advice or suggestions.
Earn Free Silver with a New Gold IRA
Goldco is an excellent company to work with, and their current promotion just makes them all the more appealing. Right now, when you open a new Gold IRA, you can receive up to 10% back in free silver. This is a great way to help further diversify your portfolio and increase your holdings in precious metals.
Pros & Cons of Goldco
Augusta Precious Metals, which was founded in 2012, is another one of our favorite Gold IRA companies. In the decade that the company has been in business, Augusta Precious Metals has helped numerous clients to diversify their portfolios by investing in precious metals.
The company's website outlines their top three priorities: transparency, simplicity, and service. From reading the reviews of past customers, it begins clear that Augusta Precious Metals really works hard to keep these priorities in the forefront of all of their business operations. They have also earned the highest ratings possible from the Better Business Bureau and Business Consumer Alliance.
Gold and Silver IRAs
When you're ready to diversify your portfolio and open a Gold or Silver IRA with Augusta Precious Metals, you can feel confident that you'll receive assistance and support to help you through the necessary steps. The team at Augusta Precious Metals is experienced and ready to give personal attention to each customer by helping them complete forms or offering suggestions on the best precious metals to add to their account.
IRA-Approved Precious Metals
Below you'll find some of the different gold and silver coins and bars offered by Augusta Precious Metals. All of these options satisfy the minimum purity requirements outlined by the IRS (99.5% pure for gold and 99.9% pure for silver).
Storage for IRAs
IRS regulations require that individuals store the precious metals for their IRA in an approved depository. Augusta Precious Metals works with the Delaware Depository to ensure secure storage for their clients' metals. The Delaware Depository is a leader in the storage industry and offers highly secure storage options. With the state-of-the-art technology and the full-coverage insurance policy, you won't need to worry about the safety or security of your metals when they're stored at the Delaware Depository.
Pros & Cons of Augusta Precious Metals
American Hartford Gold is a family-run company that was started by Sandford Mann in 2015. Between its numerous 5-star reviews from past customers, high ratings from the Better Business Bureau and Business Consumer Alliance, and endorsements from several celebrities, like Lou Dobbs, Bill O'Reilly, and Megyn Kelly, it is clear that there are a lot of reasons to consider working with American Hartford Gold.
Gold and Silver IRAs
Now that you know a bit more about the company as a whole, let's look at how you can set up a Gold IRA with American Hartford Gold. On the company's website, they share that they have worked to keep the process as easy as can be. There are just three simple steps to complete, including confirming that your existing retirement account is eligible for a rollover, contacting a Gold IRA custodian to transfer fund from your old account to your new account, and choosing which coins and bars you wish to invest in.
If you need support with that last step and are unsure which coins or bars you wish to purchase, your representative will be able to share some suggestions based on your preferences and investment goals. The different IRA-approved coins and bars to choose from include:
Pros & Cons of American Hartford Gold
Birch Gold Group is another one of the best Gold IRA companies, in our opinion. But don't just take our word for it—look through the superior reviews that past Birch Gold Group customers have left for the company. Review organizations, like the Business Consumer Alliance and Better Business Bureau, have also awarded Birch Gold Group their highest ratings of AAA and A+, respectively.
Setting up a Gold IRA and Selecting Precious Metals
Birch Gold Group specializes in helping their customers open Gold IRAs. One of the things that sets them apart from many other companies is that they also offer the opportunity to invest in platinum and palladium. By adding some platinum and palladium coins and bars to your portfolio, along with gold and silver pieces, you can further diversify your portfolio. This will offer even greater protection against volatility within one type of asset.
Simply work with your agent and an IRA custodian to get your account set up and transfer the funds from your old account. Then, select which coins and bars you'd like to invest in (see the list below). Your agent can provide you with advice about which pieces are best to invest in. They'll also take care of transferring your precious metals to the Delaware Depository or Brink's Global Services for secure storage.
Pros & Cons of Birch Gold Group
Our review of the best Gold IRA companies couldn't be complete without mentioning Noble Gold. While they are the youngest company on our list, being founded in 2016, they have done a lot to earn their position in our rankings. Just scroll through reviews from past customers, and you can get an idea for the positive experience that awaits you with Noble Gold. In addition to these high reviews, Noble Gold has also earned an AA rating from the Business Consumer Alliance and an A+ from the Better Business Bureau.
Noble Gold's Precious Metals IRAs
Noble Gold would love to help you open a Precious Metals IRA. You can invest in gold and silver, as is common with most other companies. However, Noble Gold also has platinum and palladium coins that its investors can choose to add to their IRA portfolios. With these additional options, you'll not only have a wider selection of coins and bars to choose from, but you'll also be able to diversify your portfolio more than would be possible with just gold and silver.
The gold, silver, platinum, and palladium coins and bars listed below all meet the purity requirements set forth by the IRA (99.5% pure gold, 99.9% pure silver, and 99.95% pure platinum or palladium).
Pros & Cons of Noble Gold
Frequently Asked Questions
Is opening a Gold IRA a good idea?
While only you and your financial advisor can determine what the right investments are for you, there are several reasons to consider opening a Gold IRA. With a Gold IRA, you're able to diversify your portfolio. When some of your money is held in alternative assets, you're less likely to be as negatively impacted by stock market downturns.
Gold, silver, and other precious metals are also highly desirable across the globe. When you combine this demand with their limited supply, it is easy to see how their value could easily continue to rise. High demand for these precious metals also means that they are easy to liquidate. If you decide that you want to sell your precious metals to receive cash when you retire, it should be easy to find someone to buy them from you for a good price.
Another reason to consider adding gold and silver to a retirement account is that they are tangible assets. You can physically hold gold or silver coins and bars. Their value isn't going to just disappear, as is possible if you invest in a company that suddenly goes under.
How much money can you invest in a Gold IRA?
When you set up a Gold IRA, you can rollover some or all of the funds from an existing IRA. The rules for investing new money in a Gold IRA are the same as they are for other IRAs. If you are under 50, you can make a maximum contribution of $6,000 each year. If you are 50 or older, your contribution limit is a bit higher at $7,000. It is important to note, however, that these amounts are the total maximum contribution to any type of IRA. That means that you'll have to split your contributions if you have other IRAs.
Can you transfer funds from an existing IRA into a Gold IRA?
Yes, many existing retirement accounts are eligible for an IRA rollover or transfer. Some of the account types that may be eligible include traditional IRAs, Roth IRAs, SEP IRAs, 401(k)s, 403(b)s, TSPs, and 457(b)s. To confirm whether your account is eligible, you can contact a Gold IRA company. They'll be able to provide you with specific information about your situation.
How much of my portfolio should hold gold?
There is no right answer regarding what percentage of your portfolio should hold gold. To determine the ideal percentage for your specific situation, there are a few factors to consider. These include your current age, how many years you have left before you retire, how much risk you're willing to take on, and your financial goals.
Gold and other precious metals are often viewed as a riskier investment. If you're getting closer to retiring, you may want to hold a smaller percentage in your portfolio. If you still have several years left until you're old enough to retire, you may decide that you want to invest a greater percentage of your money in precious metals.
Many investors recommend holding between 5% and 10% of your portfolio in precious metals. You can use this information, the advice of your financial planner, and your current age to help you determine the ideal precious metals percentage for your portfolio.