Why Invest In A Gold Ira

Author Ginger Felton Posted on October 28, 2023October 28, 2023Categories Invest In Gold Ira   Leave a comment on Why Invest In A Gold Ira

The average American’s IRA includes stocks, bonds, and mutual funds and is administered by large financial institutions. These traditional vehicles for wealth protection in an IRA do not provide any assurance. Case and point–the importance of diversifying in entirely different asset classes was amplified in the 2000 and 2008 financial crises. In 2008, the stock market dropped nearly 40%, real estate values plummeted, unemployment surpassed 10%, and the dollar weakened. It became evident that although stocks, bonds, and real estate are different asset classes, all three are highly correlated in a crisis. This perfect storm evaporated retirement savings and nearly wiped out the safety net of many hard-working Americans.

Mainstream media, employers, and large financial services companies actively promote investment in the stock market and real estate as a means of accumulating wealth. However, these institutions neglect to emphasize the value of investing in precious metals for wealth preservation. Since 2000, investing in Gold IRAs has demonstrated a strong track record, primarily due to Gold’s ability to maintain stability during volatile market conditions.

Everyone has some insurance to protect what matters most. Like home, auto, and life insurance, a Gold IRA is your retirement savings insurance. True portfolio diversification includes precious metals to immunize your savings from steep stock market crashes, currency devaluation, inflation, and deflation. An IRA holding physical precious metals is an important option for ensuring full diversification.

Understanding The Benefits Of Investing In Gold

Investing in gold has the added benefit of acting as a hedge against uncertainty and volatility in the economy. In periods of economic unrest, like recessions or geopolitical unrest, investors might seek refuge in the security and steadiness of gold.

This can offer stability during erratic periods and shield your portfolio from any losses. 

ETF Vs. Physical Gold

In addition to physical ownership, precious metals can be acquired via paper assets known as Gold ETFs.

ETFs (Exchange Traded Funds) are paper stocks backed by an underlying asset, in this case, Gold, with the most-traded Gold ETF being the ticker symbol “GLD.” While Gold may back a Gold ETF, it’s not the same as owning physical Gold. Because investing in ETFs is like buying stock in Gold, the value of these assets fluctuates with the market value of Gold, but you can never exchange the ETF for actual Gold (or any other precious metal).

ETFs are ideal for frequent traders as they offer the convenience of investing in various assets without the need for physical ownership or associated storage costs. ETFs do, however, come with recurring annual fees that deduct a percentage of the investment’s value to cover management and administrative expenses. The leading ETF, SPDR Gold Shares (GLD), charges an annual fee of 0.40% and a transaction fee for each share traded.

In addition to a lack of physical ownership, the second primary limitation of a Gold ETF lies in its impracticality as a long-term investment option due to the commonly associated practice of intraday trading, where buying and selling occur within the same day to profit from short-term price fluctuations. Thus, Gold ETFs restrict the potential benefits of Gold as a long-term store of value and hedge against economic uncertainties.

For investors seeking enhanced control and a clear understanding of common law property rights, the choice is clear: owning physical precious metals stored under their name in a vault or secured depository rather than navigating the intricacies of a complex network of securities with limited redemption rights. This fundamental distinction sets apart owning precious metals from ETFs.

It is important to note that there have been numerous instances where sponsors of Gold ETFs abruptly suspended redemptions or imposed restrictions on shareholders, preventing them from accessing or purchasing more of the underlying security. The actions of the iShares Gold Trust (IAU) in March 2016 illustrate this phenomenon.…

Gold IRA Vs Physical Gold – What Are The Main Differences?

Author Ginger Felton Posted on October 27, 2023November 22, 2023Categories Gold Ira   Leave a comment on Gold IRA Vs Physical Gold – What Are The Main Differences?

Let’s dissect the main differences between the two concerning retirement fund protection:

Gold Ira: Retirement-Focused Gold Investment

Tax Advantages:
Gold IRAs come with distinct tax benefits. See here for more – https://durhampreciousmetals.com/gold-ira-tax-rules/.  Investments grow tax-deferred, meaning you won’t pay taxes on capital gains or dividends until you withdraw. Depending on whether you have a traditional or Roth Gold IRA, your contributions may be pre-tax (taxed upon withdrawal) or post-tax (tax-free withdrawals), respectively.

Regulated Custodianship:

Custodians oversee gold IRAs, typically financial institutions that ensure the Gold’s purity, weight, and storage meet IRS standards. This regulation provides an additional layer of security for your investments.

Asset Diversification:

While named “Gold IRA,” these accounts can also hold other precious metals like silver, platinum, and palladium. This diversification can help insulate retirement funds from the volatility of any single precious metal.

Defined Contribution Limits:

Gold IRAs have set contribution limits, which can foster disciplined, regular investing, helping accumulate wealth for retirement systematically.

Limited Access:

Funds in a Gold IRA are designed to be used post-retirement. Early withdrawals (before the age of 59½) can incur penalties and taxes, discouraging impulsive use of the funds.

Physical Gold: Tangible Asset Ownership

Direct Control And Access:

Physical Gold offers investors direct control over their assets. This means they can decide when to sell or use the Gold, providing flexibility. However, this also comes with the risk of impulsive selling or mismanagement.

Storage Risks And Costs:

With physical Gold, the onus of secure storage rests on the investor. While this can offer a sense of control, the investor must bear the costs and risks associated with storage, such as theft or natural disasters.

Liquidity:

Physical Gold can be sold relatively easily in most places worldwide. However, the selling price might vary based on global market rates and dealer-specific rates, potentially impacting the returns on the investment.

No Tax Deferrals:

Unlike Gold IRAs, profits from selling physical Gold are subject to capital gains tax. Depending on the holding period, these gains can be classified as short-term or long-term and are taxed accordingly.

No Contribution Limits:

There are no limits to how much physical Gold an investor can purchase, allowing for large one-time investments. However, this also means there’s no systematic, disciplined approach enforced, which can be a double-edged sword for retirement planning.…

Gold Iras 

Author Ginger Felton Posted on October 26, 2023October 28, 2023Categories Gold Ira   Leave a comment on Gold Iras 

The physical Gold IRA is for investors who want to own gold bars and coins in their retirement accounts.

A Gold IRA works just like the IRA you may already own, but it is self-directed. With self-directed IRAs, you can possess tangible assets like gold and silver, real estate, and investment properties, as well as all common paper assets like stocks, bonds, treasuries, CDs, and exchange-traded funds (ETFs).

There Are Three Types Of Gold Iras:

  • Traditional
  • Roth
  • Simplified Employee Pension (SEP)

You can convert any existing one of these IRA kinds into a Gold IRA tax-free and penalty-free.

If you are 59 ½ and own a 401(k) or similar plan, or if you own a 401(k) from previous employment, you may also roll over that plan into a Gold IRA. The Gold IRA rollover process is also tax-free and penalty-free.

Withdrawals are penalty-free after age 59 ½. For traditional and SEP plans, the IRS taxes withdrawals as ordinary income. Roth plans also allow tax-free withdrawals.

For precious metals that qualify for an IRA, the IRS has tight regulations. Accepted metals have to fulfill the following requirements:

Coins must be produced by a government mint.

Approved producers, refiners, and assayers are required to make bars.

Gold must make up 99.5% of the metal.

Coins ought to be brand-new, unused, and in flawless physical shape.

Proof coins need to come with an authenticity certificate and be in their original packaging.

Benefits Of Gold

Interwoven into cultures for thousands of years, Gold is respected worldwide for its value and rich history. Now and throughout the centuries, people have continued to hold Gold for various reasons. Below are six reasons to own Gold in an IRA today.

A Store Of Wealth:

Unlike paper currency, coins, or other assets, Gold has maintained its value throughout the ages. People see Gold as a way to pass on and preserve their wealth from one generation to the next.

Balance Of Risk And Return:

Gold is an asset that mainly provides security and insurance. Investing in Gold doesn’t keep you up at night. It has very minimal risk and works as insurance on any other investments made that are considered risky. Therefore, properly diversified portfolios combine Gold with stocks and additional investments to provide insurance and reduce overall volatility and risk.

The Weakness Of The U.S. Dollar:

The U.S. dollar is one of the world’s most important reserve currencies, and multiple factors are responsible for its decline. Among these are:

  • The country’s massive national debt.
  • Budget and trade deficits.
  • A significant increase in the money supply was due to the Federal Reserve’s monetary policies.

Inflation:

Gold has historically been an excellent hedge against inflation because its price tends to rise when the cost of living increases. Over the past 50 years, investors have seen Gold prices soar and the stock market plunge during years of high inflation.

Geopolitical Uncertainty:

In addition to times of financial uncertainty, Gold also retains its value in times of geopolitical uncertainty. It is called the “crisis commodity” because it often outperforms other investments when world tensions rise, and confidence in governments is low, making people flee to its relative safety. Investment analysts suggest that investors should consider exposure to safe-haven assets like Gold based on the potential risk of a policy error by the world’s central banks.

Gold Is A Private Form Of Wealth:

In an increasingly digitalized world, where data breaches and cyber-attacks are constant, privacy remains paramount. As a private form of wealth that is both tangible and portable, physical Gold can be discreetly accumulated, easily liquidated, and traded worldwide.

…