What Is a Gold IRA?
An IRA is the abbreviation for a qualified retirement account, known formally as an Individual Retirement Account. An IRA is a savings account (usually an investment account) designed for retirement.
Contributions may be made until the year the owner turns 70 and 1/2 in a traditional IRA plan, and there is no age limit on contributions to a Roth IRA plan. People may contribute a tax-deductible amount of up to $5,500 per year until the year in which they reach age 50. In the year the owner reaches age 50 until the maximum contribution age, the owner may save an additional $1,000 per year, making the annual limit $6,500. People may also roll over the balance of other retirement accounts, such as a 401k, into an IRA.
An IRA is usually an investment account in which most people invest in stocks and bonds (usually through mutual funds). While holdings in equities usually provide the owner with the potential for significant growth, they also have an associated risk. Many people experienced this risk firsthand during the crash in equity markets in 2008.
An IRA account does not have to hold only stocks and bonds, though other options exist. Historically, if someone were looking for safety, they would open an IRA at a bank and hold CDs. While this is very safe, the return is extremely low and may not even outpace the rate of inflation. Without growth, it makes it very difficult to save enough money.
Luckily there is a new product available. People no longer have to choose between a risky equity portfolio or an extremely low-growth CD account. A gold IRA makes it easy for people to use their retirement savings to invest in one of the oldest and most widely held stores of wealth: gold.
A gold IRA functions like any other IRA, except for what it holds as an investment. A gold IRA invests in the hard asset of gold. Not a gold fund or a gold derivative, but actual physical gold. Clients have a choice of holding Credit Suisse gold bars, various coins (American Buffalo, Canadian Maple Leaf, American Eagle, Australian Kangaroo/Nugget Coins, or Austrian Philharmonic gold coins), or various other precious metals such as silver, platinum, and palladium.
Holding physical gold reduces transaction costs and gives clients peace of mind that their money is invested exactly where they want it to be invested: in cold, hard physical gold.
A gold IRA allows money to be rolled over from an existing IRA or other retirement account, such as a 401k. Clients may also open a new IRA account and start investing with regular contributions.
Tax Deductible and Tax Deferred
Like any IRA account, any contribution (up to the legal limits) to a Gold IRA account is tax deductible. There is no limit to the amount of growth allowed, and any growth is completely tax-deferred until money is taken out of the account. This makes saving money in a Gold IRA a tax-advantaged savings method compared to a non-qualified account.
If you would like to learn more about investing in a gold IRA, please fill out our contact form today, and we will get in touch with you very soon.