A gold IRA often has higher fees than a traditional IRA or Roth IRA, which invests exclusively in stocks, bonds, and mutual funds. Proponents of gold IRAs argue that these costs are worth the peace of mind protecting yourself from a potential financial apocalypse. But let’s assume that a disaster really does occur. How would you redeem your gold if it’s in a deposit at the other end of the country?
Gold IRAs are a special type of self-directed IRA that allows you to invest in physical gold and other precious metals, such as silver, platinum, and palladium. Investing in a gold IRA requires the services of a custodian bank, a broker to purchase gold, and an approved depositary to store gold. Like other self-directed IRAs, Gold IRAs can be Traditional or Roth. While most IRA investors invest in more traditional assets such as stocks, bonds, and funds, tax legislation allows investments in precious metals such as gold
and silver through specialized IRA accounts.
The tax code also states that the gold or silver must be held by an IRS-approved custodian or trustee, although some gold IRA marketers claim that there is a loophole in this law (more on that later). You must store the gold in a gold IRA in an IRS-approved depot. You can’t keep it in a safe, a home safe, or under your mattress. It must be emphasized that a gold IRA is only necessary if an investor wants to invest in physical gold bars, coins, and gold bars. Patriot Gold Group has a long track record of helping investors secure their financial future through gold IRAs, and has received high marks from consumer groups along
The IRS has established metal fineness guidelines that determine whether gold or silver in the form of gold bars or coins are acceptable for a gold IRA. Required minimum distributions Once you reach the age of 70½, your Gold IRA is subject to a minimum payout (RMD), just like any other IRA account not from ROTH. To help customers avoid this threat, some IRA companies, for example, buy back their gold at the then-current wholesale price. Younger investors who have less money to invest in gold may be better off with a traditional IRA by investing in gold equivalents such as gold ETFs or gold mining stocks until they’ve accumulated enough to meet the higher
minimum requirements of gold IRAs.
Next Avenue asked the agency about these ads and received the answer: “The IRS cannot comment on the allegations made by a particular IRA promoter, but the agency is warning taxpayers to be wary of anyone who claims that the gold in your IRA can be stored at home or in a safe. Augusta’s two major drawbacks are its limited selection of metals and the high minimum investment requirements for setting up a gold IRA. Costs of buying and storing gold Once you’ve chosen a specialized, self-managed IRA gold custodian, you need to remember that there are fees for all aspects of buying, storing, and selling the gold. However, if you work with a reliable and customer-focused gold IRA firm, it is likely that they have a favorable buyback policy for coins or gold bars, although their transaction costs may be higher for gold bars
I believe the idea behind storing gold or silver in a Roth IRA is to create a tax haven against such an egregious move by the government.