Convert IRA to Gold

Investors are asking this question today as Inflation rages and market risk rises to nose-bleed levels.

How do I convert my IRA

to Precious metals?

Recognizing that their retirement savings are at risk investors are searching for ways to protect and secure their hard-earned money.

Many of them are discovering for the first time that a Precious metals IRA allows them to hold physical Gold and Silver inside their tax-advantaged savings plans.

These newly informed investors get even more excited after learning that the transition from paper Investments to physical Investments can be accomplished without paying any taxes or penalties.

If you are interested in gaining the benefits of physical Precious metals, converting your IRA to Gold is a solid strategy.

In fact, unless you are a small business owner with zero employees, a Gold IRA is the only way you can hold physical Precious metals inside your tax-deferred or tax-exempt Retirement accounts.

If you happen to be a small business owner with no employees, do some research on Solo 401(k)s. They will let you invest in physical Precious metals and the annual contribution limits are significantly higher than in a regular 401(k) or IRA.

Gold IRA vs physical Gold

When you decide to protect your retirement savings with physical Gold you have two options

Option 1: Close IRA - Pay taxes & penalties

Obviously, you could liquidate your IRA and purchase Precious metals with the proceeds.

That’s an easy solution but it has significant tax consequences.

If you are under age 59 1/2 you will pay a 10% early-withdrawal penalty and then pay income taxes on the distributed funds. 

Also, the distributed money may push you into a higher tax bracket where the overall cost of liquidating your IRA will increase.

Option 2: Move IRA funds into Gold IRA

The IRS made this option possible in 1997 when the Taxpayer Relief Act was passed.

This revision to the tax laws makes it possible for you to purchase physical Precious metals inside a self-directed IRA.

You are also permitted to move tax-advantaged funds from one account to another so the Taxpayer Relief Act lets you convert your IRA to Gold without facing any penalties or tax consequences.

Physical Gold IRA

Obviously, it is quite expensive to completely remove money from existing tax-advantaged Retirement accounts until you are at least age 59 1/2.

Prior to that major milestone the money in tax-deferred savings is essentially stuck.

Converting your IRA to a Gold IRA lets you protect and preserve these 'stuck' funds until you reach retirement age.

Already know that you want to protect your retirement savings and do it 100% tax & penalty free?

Click the link below to grab your FREE 2022 Gold IRA Kit which has helped thousands of Americans just like you.

But...If you would like to know more about how to convert IRA to Gold feel free to continue reading below.

How does a Gold IRA work

?

To begin our Gold IRA guide let’s understand that “Gold IRA” is a generic term. We can hold Gold, Silver, Platinum, and Palladium in our “Gold IRA”.

“Gold IRA”, “Silver IRA”, “Precious metals IRA” – all of these terms refer to the self-directed Individual Retirement Accounts (IRAs) established by the Taxpayer Relief Act of 1997.

After you setup one of these self-directed IRAs you can then move some or all of the funds from your regular IRA into your Precious metals IRA.

In fact, most Retirement accounts can be transferred into a Gold IRA. If you have a 403b, 457, TSP, Annuity, Pension plan, or eligible 401(k), you can move those funds into your Precious metals IRA.

Once your Gold IRA is funded, you get to pick which Precious metals you will hold and what form you want those metals to be in.

In general you can choose Bullion bars and Coins produced by IRS-approved refineries along with Coins produced by government mints.

When it is time to take distributions from the Gold IRA you can choose to sell your metal and receive cash, or you can distribute the physical metal and have it securely mailed to you (or go pick it up in person).

Gold IRA tax rules

The Taxpayer Relief Act defines the parameters for holding physical Precious metals in a self-directed IRA.

In general, the metal must be of Bullion quality (99.95% pure) or better and come from an IRS-approved source like a government mint or third-party refinery.

Coins and bars meeting these specifications receive the same tax treatment in a Gold IRA that stocks and bond receive in a regular IRA.

That means when it is time to take a distribution from our Gold IRA any capital gains will be taxed as ordinary income just like a stock or bond.

Distributions from the Gold IRA can be taken as cash or physical metal.

Gold IRA fees

There are fees in a Gold IRA that don't exist in a regular IRA.

The extra fees occur because we are investing in physical Precious metals instead of paper stocks and bonds.

To purchase or sell physical metal we have to use a licensed Broker and that professional charges a fee.

The Broker fee occurs whether we buy Gold for our IRA or Gold to bury in the garden.

The other Gold IRA fee to be aware of is a storage fee.

Because the IRS requires third-party storage for the Precious metals in our IRA, we have to pay a Custodian to securely store and insure that metal.

How can I transfer my 401k to Gold without penalty

Benefits of Gold IRA

The primary benefit of a Gold IRA is that it provides us with a way to own physical Precious metals inside a tax-advantaged retirement plan.

We get all the same tax benefits from a Gold IRA as we do from a traditional IRA holding stocks and bonds.

In a Gold IRA, however, we can choose to distribute and take possession of our physical metals if we want.

At that point the shiny stuff is in our hot little hands to do with as we please (while abiding by all IRS rules, of course).

We can sell the Gold at the local Coin or pawn shop, bury it in the garden, give it to the grandkids, or 'lose it in a boat accident'.

Transferring wealth through the ages is what Gold is all about. It is inherently recognized by all humans as something of value.

While its price per ounce may vary over the years when measured in the fiat currency of the day, Gold is never worth zero in any currency – ever.

Gold IRAs provide a unique way to combine the wealth preservation aspects of physical Precious metals with the tax benefits of a self-directed IRA.  

How to buy Gold in IRA

Whether you have an IRA or an eligible 401(k), you will follow the same steps to convert your paper stocks and bonds to physical Precious metals.

01

Choose a Gold IRA company

02

Open an account

03

Initiate a distribution or rollover from your existing Retirement account

04

Fund the Gold IRA account

05

Select the Precious metals to hold in the Gold IRA

Selecting specific Precious metals products is where the rubber meets the road in the process of converting an existing 401K or IRA into a physical Gold IRA.

The selections we make at this point can dramatically affect the value of our Gold IRA in both the immediate future and over the lifespan of the IRA. If we look at negative customer reviews regarding Gold IRAs we will find that, in most cases, the investor made a less-than-optimal choice when they selected their Precious metals products.

Which Precious metals products should we invest in?

When we are selecting the metals to hold in our Gold IRA  we have two decisions to make:

1. Which of the four Precious metals do we want to hold: Silver, Gold, Platinum, or Palladium?

2. What form will those metals be in: bars or Coins?

Silver and Gold

Gold is the hands-down winner as a store-of-value over the ages. It is hard to go wrong owning some Gold.

From a demand perspective, Silver is an interesting metal because it has significant commercial demand while also enjoying Investor demand.

Gold’s commercial demand is quite limited because of its cost. Most of the Gold that has ever been mined is sitting above ground in museums, vaults, and jewelry boxes.

Silver on the other hand gets used in very small quantities in all kinds of electronic devices where it isn’t economically viable to recover the Silver.

In other words, commercially-used Silver is thrown away when the commercial device reaches end-of-life.

Commercial demand for Silver is growing because Green energy (solar panels and wind turbines), electric vehicles, and 5G technology are all highly dependent on the reflective and conductive properties of Silver.

Because of the two-pronged demand for Silver, including at least some of the white metal in our Gold IRA makes sense.

Platinum and Palladium

The primary commercial demand for Platinum and Palladium is for catalysts in automotive catalytic convertors.

These metals enjoy some amount of Investment demand. The simple fact that the IRS allows the metals inside self-directed IRAs creates investor interest.

Whether there is significant Investment demand for the two metals is debatable. They certainly can’t compare on historic terms with either Gold or Silver.

Another point against investing in these metals is that the average human can’t tell any difference between Silver, Platinum, or Palladium. If they held Coins made of each metal they would be unable to determine which Coin was made from which metal.

Silver is under $25 an ounce currently, Platinum is almost $1000, and Palladium is around  $2000 (May 14, 2022).

So we have three Precious metals that can't be distinguished from one another and one of them is significantly less expensive than the other two.

It is very hard to justify why an investor should purchase the more expensive metals as long as Silver is available.

Most weight of metal for the least amount of money

Regardless of which Precious metals we choose to hold in our Gold IRA we always want to get the most metal possible for each Investment we make.

By following this simple guideline we avoid one of the primary risks with a Gold IRA and that is paying a premium for collectible or Numismatic Coins.

Beauty is in the eye of the beholder

The only time it makes sense to pay for Numismatic quality Coins is when we want to appreciate them as timeless pieces of beautiful artwork. Some of the pre-1933 Gold Coins are absolutely stunning.

As art collectors we understand that beauty is in the eye of the beholder so the value of our collectible Coins could fluctuate dramatically over time - both up and down.

As conservative Investors we aren’t buying artwork, we are buying physical Gold.

Every time we invest money in our Gold IRA we want to get the most ounces of metal we possibly can for every penny we invest.

That means we aren’t interested in proof Coins, boxed Coins, certificates of authenticity, or any other fancy-schmancy stuff.

Just remember that we're investing in Precious metals not art.

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Best Gold IRA

The best Gold IRA is likely to be different for each investor depending on the factors that are most important to them personally.

Some will prioritize based on the location of the Gold IRA depository. An investor in Texas, for example, may limit their candidate Gold IRA companies to the ones that work with depositories in Texas.

Investors with limited funds will focus on the Gold IRA companies with the lowest minimum Investment.

Regardless of which factors you choose to prioritize, the best Gold IRAs will have these factors in common:

Gold and Silver IRA

  • A+ rating at Better Business Bureau
  • 10 or more years in business
  • Insured depository
  • Segregated storage of metals
  • Regular audits of the depository

Vanguard Gold IRA

Gold IRA reviews

One of the best ways to research candidate Gold IRA companies is to read the online customer reviews posted on these sites:

  • Better Business Bureau (BBB)
  • Consumer Affairs 
  • TrustLink 
  • Trustpilot

Recognize that these reviews are written by investors who interacted with the company in question and felt compelled enough by their experience to provide feedback. The most valuable reviews are actually the negative ones because they let us see how the company responds to unhappy customers.

The negative reviews are OK as long as the company responds to the complaint and makes an attempt to resolve the matter.

When you read the negative reviews pay attention to the focus of the complaint. In most cases, the customer's dissatisfaction occurs because they purchased overpriced proof or Numismatic Coins and then lost money when they liquidated their account.

You and I can avoid these potential problems by simply avoiding proof and Numismatic Coins. They are not a good Investment choice for most investors.

Gold IRA companies

In the table below we have listed some candidate Gold IRA companies by their years in business.

Investors can use a list like this to compare Gold IRA companies and focus on the factors that matter the most for their particular circumstances.

Low minimum Investment

This factor will be important to investors with limited funds. Minimum Investments are $2000 to $25,000. 

Most companies offer perks like free Silver or waived fees on larger Investments.

Proof and Numismatic Coins

These fancy Coins are a poor choice for most investors. The fact that a Gold IRA company offers these Coins shows that they are willing to let investors make less than optimum choices.

Negative reviews about Gold IRAs usually involve these high-priced Coins. Companies who aggressively push these Coins are prioritizing their profits over helping investors.

Ask a loaded question

When you get to the point of calling Gold IRA companies ask the representatives if they recommend Bullion products or if there are better options.

The response to this loaded question may help you find the company that you will be most comfortable working with.

If a company gets pushy about 'Investment quality' Coins (proof Coins, boxed Coins, or Coins with certificates of authenticity) or mentions a lack of liquidity when it comes time to sell, immediately cross that company off the candidate list and keep shopping.

There are lots of Gold IRA companies to choose from so don't let pushy salespeople influence your Investment decisions.

Precious metals IRA company

Fidelity

  • Founded: 1946
  • BBB rating: C-
  • Proof Coins: No
  • Minimum Investment: $1,000

Patriot Gold Group

  • Founded: 1990
  • BBB rating: A+
  • Proof Coins: Yes
  • Minimum Investment: $15,000

Birch Gold

  • Founded: 2003
  • BBB rating: A+
  • Proof Coins: Yes
  • Minimum Investment: $10,000

Goldco

  • Founded: 2006
  • BBB rating: A+
  • Proof Coins: Yes
  • Minimum Investment: $25,000

Regal Assets

  • Founded: 2010
  • BBB rating: unrated
  • Proof Coins: Yes
  • Minimum Investment: $10,000

Noble Gold

  • Founded: 2017
  • BBB rating: A-
  • Proof Coins: Yes
  • Minimum Investment: $2,000

Gold IRA

Year founded

BBB rating

Proof Coins

Minimum Investment

Fidelity

1946

C-

No

$2,500

Patriot Gold Group

1990

A+

Yes

$15,000

2003

A+

Yes

$10,000

2006

A+

Yes

$25,000

2010

unrated

Yes

$10,000

2012

A+

Yes

$50,000

Noble Gold

2017

A-

Yes

$2,000

Grab your FREE 2022 Gold IRA Kit which has helped thousands of Americans just like you.

Summary

In this brief Gold IRA guide we've looked at how to transfer an existing Retirement account into physical Gold.

We've considered the different Precious metals we can hold in our Gold IRA and why we might choose one metal over another.

A key point we covered is how to avoid overpaying for the metal inside our Gold IRA by staying away from proof Coins, boxed Coins, and any other premium Coins.

For other questions about how to convert your IRA to Gold, or whether an existing Retirement account is eligible for transfer, you can reach out to one of the Gold IRA companies. All of the reputable companies have knowledgeable representatives available to help you.

About Satori Traders

Satori Traders LLC is a California-registered Investment Advisor specializing in the Precious metals.

Bryan V Post is a California-registered Investment Advisor Representative and the founder of Satori Traders.

Bryan has worn numerous hats during his life: Engineer, Portfolio manager, Precious metals Investor, Technical analyst, Proprietary trader, Swing trader.

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