What Is a Gold IRA? What You Need to Know

According to one survey, 12% of all Americans own gold. If you’re interested in also owning gold, you may want to open a gold IRA. 

This can be a great investment opportunity for people who want to diversify their portfolios. 

But what should you know before you invest in gold? Keep reading to discover all you need to know. 

photo/ Steve Bidmead via pixabay

What Is a Gold IRA?

A gold IRA is different than a traditional Roth or IRA. Instead of investing in your stocks, bonds, mutual funds, and securities, you’ll invest in precious metals.

You’ll hold gold in the form of bullion, bars, and coins. You can also be investing in precious metals like palladium, platinum, and silver in places like Lear Capital Silver.

The rules of the IRA follow the same rules as a traditional IRA. 

Many gold IRA accounts can also invest in paper assets as well. However, this is rare because most gold IRAs are only for physical metal investments.

Different Types of Gold IRAs

There are different types of gold IRAs as well. You can get a traditional gold IRA, you will have a retirement account.

You’ll fund it with money before it’s taxed, and you’ll grow your earnings on a tax-deferred basis. When you withdraw your money for retirement, it’ll be taxed at retirement. 

You could also have a SEP gold IRA. These IRAs are only available to employees of a small business or for self-employed individuals. You’re only taxed when you make withdrawals during your retirement. 

There are limits to how much you can put in there, but they’re normally a percentage of your salary. 

How to Open Gold IRA

If you’re interested in doing this type of investment, you’ll need to open a gold IRA first. To do that, you’ll have to call a bank account, credit union, or some other trusted company to open a gold IRA account.

You’ll also want to make sure that you find someone to look over the gold for you. Try and find companies that have held gold IRAs and other physical assets before. 

That way, you’ll know if you can trust the company by investing in your gold. 

How to Invest in Gold IRA

Now that you have an account, you’ll need to start investing in your IRA. Once you find a dealer, they’ll buy the gold for you and then invest it into your IRA. 

Remember that they may offer different choices, so you’ll have to consider that before you open the account. 

Next, you’ll need to fund the account with your salary or pre-taxed money. After you select the investments, the custodians will buy the gold for you on your behalf. 

Learn More About What a Gold IRA Is

These are only a few things to know about what a gold IRA is, but there are many factors that you should consider.

We know that investing can be tricky, which is why you should consider hiring a financial advisor.

But for more related financial tips, you can explore our website to get more information. 

Author: Laura Brown