Click Here To Print

Written by retirement experts Pat Collins and John Halloran.

Table of Contents 

1. Introduction To Gold IRA Investments

With inflation rearing its ugly head, retirement investors are looking to protect their future purchasing power with a gold IRA investment. 

There are three main ways you can invest in gold IRAs to diversify your retirement portfolio.

Investors acquiring precious metals that want sole ownership will need to set up a self-directed IRA through a gold IRA company and choose an IRS approved depository. If owning actual gold is not important, you should consider the pros and cons of gold stocks, mutual funds or a gold ETF.

2. What Is A Physical Gold IRA?

A physical gold IRA is when you have sole ownership of physical precious metals held in a self-directed IRA and stored at a 3rd party IRS approved depository. 

Although generally referred to as a gold IRA, other approved precious metals you can hold are physical silver, platinum, and palladium. In fact, if you ask your gold IRA company, they’ll tell you that more people are investing in silver IRAs than gold IRAs in recent years. 

You are allowed to hold 1/10, ¼, ½, and 1 ounce U.S. Treasury Department minted precious metal coins. Additionally, other bullion bars and rounds are considered approved precious metals if they meet stringent purity requirements. All precious metal coins must be in Brilliant Uncirculated (B.U.) condition. U.S. Proof American Gold Eagle and Silver Eagle coins are allowed as long as they have the Certificate of Authenticity and are in flawless condition with the original U.S. mint packaging.  

Once the gold IRA company delivers your investment, the depository will take up to 5 days to verify that your items are authentic (not counterfeit) and are in perfect B.U. condition. The depositories generally only offer commingled storage for silver coins in your precious metals IRA. Physical gold coins and gold bars can be stored segregated in a private safety deposit box for an additional annual cost. Other precious metals items such as platinum and palladium can be stored either commingled or segregated. Most precious metal depositories are insured by Lloyds of London and must be qualified per (IRC-408n).

Physical precious metal IRA accounts are typically the most costly option of gold investments because the metal must be shipped, stored, and insured, unlike a digital asset. 

You will need to pay the annual custodial fee and insured depository cost of under $200. There is also a buy/sell spread charged when purchasing physical precious metals. 

Selecting a precious metals dealer is the most crucial step with physical gold investments inside your self-directed IRA. The gold IRA industry is not regulated by the SEC and so many gold IRA companies use tricky promotions, fake affiliate reviews and will try to sell you obscure over-priced items.

While you can lose money with a gold or silver IRA depending on market conditions, physical precious metals have been valuable and considered money for the last 2500 years.

 

3. Pros of Holding Gold Bullion Investment

• You Own 100% Of The Precious Metals On Account
• Can Take Delivery In National Emergency
• Physical Gold And Silver Bullion Rise with Spot Price
• Can Take In-Kind or Cash Distributions for your RMDs
• Never been worth zero and is a debt-free asset

4. Cons of Holding Gold Bullion:    

• Costs Are Higher When Buying Physical Gold And Silver Versus Digital Assets
• Overpriced California Gold IRA Companies Have Big Ad Budgets
• Best Gold IRA Companies Reviews Are Paid Affiliate Scams
• Watch Out For Free Gold Or Silver And Zero Fee Promos 
• Many Los Angeles Area Companies Charge Massive Spreads

5. Popular Precious Metal Bullion Investments That are IRS Approved for a Self-Directed IRA:

• U.S. and Royal Canadian Mint Gold Coins
• Gold Bars .999 or Better
• Platinum Coins And Bars
• Silver Bars .999 or Better
• Perth Mint gold, silver, platinum coins
• American Eagle Gold And Silver Proof Coins

All products allowed in a precious metals IRA must be Brilliant Uncirculated (B.U.) condition.

Gold American Eagles are the most popular precious metal coins held inside a Traditional or Roth IRA. In addition to gold, the internal Revenue Service (IRS) also allows silver, platinum, and palladium metals inside your self-directed IRA. So long as they meet specific purity requirements and are in Brilliant Uncirculated (B.U.) condition.

Your precious metals dealer of choice can help you complete your new gold IRA paperwork or help you sell precious metals from your Self-Directed individual retirement account.

The Certified Gold Exchange specializes in selling gold bullion and silver coins. Since 1992, we have offered the best precious metal prices coupled with exceptional service. Contact our gold IRA experts to set up a precious metals IRA account. Or even if you are acquiring precious metal for home delivery. Whether you want to invest in gold or are considering selling your holdings, call the most reputable gold IRA company in the U.S. at 800-300-0715.

6. Gold Stocks In Retirement Accounts

Many gold IRA investors choose to bet on the rising gold prices by purchasing individual precious metal stocks. While paper assets like equities do offer exposure to metals, they also come with additional risk compared to precious metal IRAs holding physical items.

Stock investing can be complex because there are 100s of variables along with supply and demand that affect values. Gold stocks are generally more volatile than other sectors. According to an Ernst & Young Global Limited 2020 mining report, the top ten opportunities and risks affecting the mining industry are:

1. License to Operate 
2. High-Impact Risks
3. Productivity and Rising Cost
4. Decarbonization and the Green Agenda
5. Geopolitics
6. Capital Agenda
7. Workforce Issues
8. Volatility
9. Digital and Data
10. Innovation

7. The Top 10 Publicly Traded Precious Metals Mining Companies Based Market Cap Are:

1. BHP, Australia/UK 180.45 
2. Rio Tinto, Australia/UK 146.75
3. Anglo American, UK 63.37
4. Glencore, UK 61.08
5. Newmont Corporation, U.S. 59.29
6. China Shenhua Energy, China 59.26
7. Barrick Gold, Canada 44.94
8. Zijin Mining Group, China 44.21
9. Anglo American Platinum, South Africa 33.88
10. Franco-Nevada, Canada 29.25

Above figures represent billions in U.S. dollars. Source:https://www.statista.com/statistics/272706/top-10-mining-companies-worldwide-based-on-market-value/

8. Gold Mutual Funds

Gold funds are professionally managed and are another way to gain exposure to precious metals in retirement accounts. They are generally invested in precious metals mining stocks but occasionally hold physical gold, silver, platinum, or palladium. These funds can be an effective option for a retirement portfolio for those that can’t hold precious metals physically in a gold IRA.

9. The Largest Precious Metals Funds by Market Cap Are:

1. Wells Fargo Advantage Precious Metals Fund – (EKWAX)
2. Fidelity Select Gold Portfolio Fund – (FSAGX)
3. Gabelli Gold Fund – (GLDAX)
4. USAA Precious Metals and Minerals Fund – (USAGX)
5. Invesco Oppenheimer Gold and Special Minerals Fund – (OPGSX)

While you do get exposure to precious metals with funds, they rarely outperform the physical gold markets. According to a 2020 Forbes report by Senior Contributor Larry Light, “60% of actively managed mutual funds underperformed the S&P 500”.

Let’s look at some of the advantages and disadvantages of investing in mining stocks and mutual funds inside your retirement account:

10. Pros of Buying Precious Metals Stocks

• Lower Cost Then Investing in a Physical Gold IRA
• Are Typically Available in a Traditional IRA Custodian Brokerage Account
• Trading Is Quicker Then With Shipping Timeline Of Physical Gold IRAs
• You May Be Exposed To Other Precious Metals Then Intended
• You Will Avoid Gold IRA Scams From Los Angeles Companies

11. Cons Of Buying Precious Metals Stocks

• Your Gold IRA Account Owns No Real Physical Gold
• There Are Many Variables with Mining Stocks Like Geopolitical Issues
• The Gold and Silver Stocks You Own May Increase Debt By Issuing New Shares
• You Don’t Get Direct Dollar for Dollar Growth with the Gold Prices
• Lower Gold and Silver Prices Could Make Mining Unprofitable

Investing in gold mining stocks and gold mutual funds may be a great option if you don’t demand sole ownership of gold coins or bullion bars. To set up a gold IRA with mining stocks, ask your financial advisor about your options.

 

12. Exchange Traded Fund (ETF): A Tool To Suppress The Precious Metals Prices

While the authors of this guide own gold stocks and physical precious metals inside a self-directed IRA, we are not keen on ETFs. The top five reasons that we shy away from gold ETFs are:

• The Supply of Metal in Gold ETFs Doesn’t Always Match The Demand
• Difficult to Understand Expense Ratios with Exchange Traded Funds
• You Don’t Have a Claim to Physical Metals as with a Self Directed Gold IRA.
• Gold ETFs Don’t Move Dollar for Dollar with Gold Bullion.
• Many Precious Metals ETFs May Be Thinly Funded, Causing Liquidation Issues
• Some Gold ETFs Employ Leverage That Could Cause Value Decay

In a nutshell, ETFs are short-term investment vehicles and are a complex way to invest in gold inside an Individual Retirement Account.

Do you need help setting up your gold or silver investment? 

First off, do not search for “best gold IRA companies” because you’ll be inundated by overpriced Southern California dealers paying affiliates for your information. You will end up paying an additional 23-37% more for the same gold IRA products than if you used a reputable dealer.

Contact the Certified Gold Exchange today to roll your old 401k to a Self-Directed Gold IRA. We guarantee a smooth transition from paper assets to your debt-free sole ownership gold or silver IRA. Call our gold IRA experts at 800-300-0715 and be sure to ask why silver IRAs are expected to outperform gold IRAs.

Disclaimer: CGE buys and sells exclusively in physical bullion coins and bars for delivery to a precious metals depository or your home. For more information on how to transfer to a self-directed gold IRA investment or for your free precious metals investors kit, call 1-800-300-0715.