Why A Gold IRA?

Consider a gold IRA to help protect your future purchasing power during the retirement phase of your life.

For millennia people have sought hard assets like gold to store their wealth during tumultuous times. The financial problems we face in the US and around the world are daunting. Few would argue this truth.

Your Retirement vs. Currency Devaluation

Placing some of your retirement wealth in a gold retirement account can help protect it from the harmful impact of excessive currency creation by central banks.

If too much of anything is created, its value will drop.
And a nation’s currency is no exception.

When a central bank devalues a currency, more of it is required in exchange for the goods and services you purchase.

I believe that when a currency is severely devalued to accommodate undisciplined spending by the public sector, demand for hard assets like gold bullion increases ... resulting in a higher spot gold price.

Like any investment, higher gold prices in the future are good news for those who buy gold in the present.

A gold retirement account is an effective means of preserving wealth so that your purchasing power during retirement is not diminished by a failing currency.

How Do I Open A Gold IRA?

The process of setting up a gold retirement account is not complicated. However, it does require the involvement of a …

  • Trustee (custodian)
  • Third-party depository (vault)
  • Gold bullion dealer

Retired Couple Bicycling

The first two parties are required because IRS rules disallow gold IRA owners from personally (directly)
buying and storing the gold bullion.

Your trustee (custodian) executes all precious metals transactions and the dealer ships your gold bullion directly
to the depository.

GoldStar Trust Company, also called Happy State Bank and Trust Co., and Entrust New Direction IRA, Inc. are
two reputable trustees.

On April 10, 2012 both companies had A+ ratings with the Better Business Bureau.

You will also need to choose a depository (vault). Important selection criteria should include ...

  • Cost
  • Insurance
  • Segregated (Allocated) Account

The first two are self-explanatory. Segregated account means your gold bullion is held separately. It is not mingled or pooled with other account holders' gold. Ownership is unencumbered (solely titled in your name).

After selecting a trustee and transferring or depositing funds into your gold retirement account, you then choose a dealer to supply the gold.

Some gold bullion dealers specialize in facilitating gold retirement account transactions, which should make the setting-up process easier for you.

Lastly, you must choose the gold bullion products for your gold IRA. Once you make a commitment, your dealer locks in the price at that moment.

Therefore, the price will be the same when the dealer contacts the trustee (or vice versa) to legally execute the transaction. Your dealer should then deliver the gold bullion to the depository.

What Is Permitted In A Gold Retirement Account?

Qualifying gold bullion products include …

Ungraded American Gold Eagle Proof Coins are the only proof coins allowed in a gold IRA. Certified (slabbed) numismatic gold coins are not permitted.

Considerations

Now fast-forward to your retirement years. Do you plan to liquidate your gold IRA holdings gradually over time? Or do you expect to sell most or all of your gold bullion at one time?

Retired Couple Sailing

Buying gold coins or small bars enables you to sell your gold in small chunks when you retire.

However, the cost per ounce to buy these smaller products is more expensive.

You are limited to small sizes if you are making an annual contribution to your gold retirement account.

IRS rules limit the yearly contribution amounts for
an IRA.

The maximum annual contribution amount cannot exceed $5,000 if under 50 years old - and $6,000 if you are 50 or older - for the 2011 and 2012 tax years.

Large gold bars are cheaper than coins or small bars on a per ounce basis … which might be a viable option if you are transferring funds from an existing retirement account to your gold IRA.

Gold coins are either bullion (only valued for gold content) or collectible (numismatic with an intrinsic gold bullion value). Please click here to learn more about the value of gold coins.

I hope this information helps as you consider opening a gold IRA. Please choose a link from my navigation bar (upper left) for more details about gold bullion and silver bullion.

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Click here to read my comments concerning Regal Assets.

The above discussion points are my opinion and should not be substituted for the advice of licensed professionals. Therefore, I hope you perform due diligence and get counsel from the appropriate adviser(s).

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