A gold IRA is a type of self-directed IRA that allows you to invest in gold bars for retirement. In a regular IRA, you can’t own physical gold, although you can invest in a wide variety of assets that are invested in gold, such as gold stocks or gold ETFs. Therefore, gold IRAs require the involvement of a custodian bank, usually a bank or brokerage firm, to manage the account. The Internal Revenue Service (IRS) allows holders of standalone IRA accounts to buy bars and coins minted from gold or other approved precious metals such as silver, platinum, or
However, the IRS has introduced additional tax reporting and record keeping requirements for gold IRAs due to the more complicated assets they hold. These investments are available in a normal brokerage IRA, meaning you wouldn’t have to go through the work and additional costs of setting up a self-directed gold IRA. Your custodian bank can refer you to an approved institution and process the gold transfer as part of setting up your Gold IRA. A gold IRA must be kept separate from a traditional retirement account, although the rules, which include things like contribution limits and distributions
, remain the same.
The term gold IRA refers to a specialized individual retirement account (IRA) that allows investors to hold gold as a qualified retirement plan. A gold IRA is a type of self-managed individual retirement account that allows individuals to keep physical gold, silver, platinum, and palladium in the account as investments. The IRS does not allow popular gold coins such as the South African Krugerrand or British state coins to be stored in a gold IRA. You can invest in gold stocks, such as stocks of gold mining companies or gold royalty companies
that help finance mines.
Before opening a gold IRA, remember that it’s not the only way to invest in gold with your retirement savings. The term gold IRA is primarily used to describe a self-directed IRA whose funds are invested in hard metals. However, if you don’t need the tax benefits of a Roth IRA, a SEP Gold IRA is worthwhile simply because of the contribution limit. SEP Gold IRAs are aimed at self-employed people such as small business owners, freelancers, and entrepreneurs
Weigh up each person’s tax benefits, and if you’re self-employed, consider opting for a SEP Gold IRA to reach the higher contribution limit.