Move 401K without penalty to Gold

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Without penalty move 401K to Gold

The simplest way to convert all or part of your existing 401(k) to Gold is to set up a self-directed IRA using a Precious metals broker-dealer as the Trustee.

Then you request a Trustee-to-Trustee transfer from your current 401(k) to the self-directed account.

This rollover can be performed without any risk of triggering taxes or penalties.

Since there are no restrictions on the number of 401(k) accounts and IRAs an Investor can have, you can open a self-directed IRA or Solo 401(k) specifically for your Precious metal portfolio and leave your existing retirement accounts in place.

The Trustee of the self-directed plan will most likely be a Precious metals broker-dealer and the physical metal will be held by an IRS-approved Custodian that the Trustee works with.

The big caveat on moving a 401K to Gold without penalty is that the move is only possible if you are no longer working for the company that provided the 401K. Currently active 401K accounts are not eligible for a Gold IRA rollover.

This short article shows you how to move your qualified 401K to Gold without penalty. We’ll expand on the individual steps below and answer some common questions that Gold Investors tend to ask.

Rollover IRA to Gold

There are a number of excellent reasons to invest in Gold:

  • Protection against currency devaluation
  • Protection against Inflation
  • Diversification for a traditional Portfolio of stocks and bonds
  • Opportunity for aggressive capital growth during the ongoing secular bull market in Precious metals

If you recognize the benefits of owning Precious metals but want to do so inside a tax-preferred Investment vehicle then rolling a traditional IRA into a Gold IRA may be the answer you are looking for.

When you are ready to take action you can roll all or just part of your existing retirement accounts into a Gold IRA and begin reaping the benefits of being invested in Precious metals.

Internal Revenue Code 408(m)(3) details the guidelines and rules for investing in Coins and Bullion inside individually-directed qualified plan accounts (IRAs).

401K to Gold IRA rollover guide

Because our objective is to move retirement funds into physical Gold without incurring a tax penalty we need to focus on IRS rules pertaining to Gold IRAs. In this section of the 401K to Gold IRA rollover guide we highlight the most important IRS guidelines to be aware of.

Important differences between a Rollover and a Transfer

The IRS makes a distinction between a rollover and a transfer of retirement accounts.

In a transfer the Investor receives funds from one retirement account (by taking a distribution) and deposits those funds into another tax-preferred account.

In a rollover the funds move directly from one Trustee to another Trustee without the Investor acting as a middle-man.

Investors tend to use the term ‘rollover’ interchangeably for both rollovers and transfers. The key distinction between the two events is whether the Investor takes personal possession of their retirement funds or not.

Gold IRA Transfer Rules

When you receive funds from your current Trustee, you have 60 days from that date to deposit the money in the Gold IRA of your choice.

If the transaction is not completed within 60 days the funds become a taxable withdrawal treated as regular income and subject to the 10% early withdrawal penalty for Investors under 59 ½ years of age. 

Gold IRA Rollover Rules

A direct Trustee-to-Trustee rollover simplifies the process of setting up a Gold IRA.

You do not personally receive any of your retirement funds so the 60 day Gold IRA rollover rules never come into play.

The IRA Trustees will typically accomplish the transfer of funds by wire.

The IRS allows for one IRA rollover per year in its Gold IRA rollover rules.

Buy physical Gold with 401K

The ideal Gold Investment Portfolio is built on a foundation of physical Gold held in the Investor’s personal possession. 

Start with some 1/10th ounce American Gold Eagle coins and throw them into your ‘grab-and-go’ bag along with the rest of the survival gear.

After securing an adequate supply of readily-accessible physical Gold consider options for moving retirement funds into physical Gold and Gold-related securities.

Since the IRS allows investors to buy physical Gold with 401K money it makes sense to understand how that works and whether it makes sense for your retirement Portfolio.

Physical Gold IRA

The process of setting up a physical Gold IRA is fairly straightforward.

You start by opening a self-directed IRA account with an IRS-approved Precious metals Broker-dealer.

You will designate this Broker-dealer as the Trustee of the IRA account.

Once the IRA account is open you perform a direct transfer or rollover from your existing 401(k) to the new self-directed Gold IRA.

Funds inside the Gold IRA may be used to buy permitted forms of Gold and other Precious metals.

Permitted Forms of Gold

The IRS only allows certain forms of Gold to be held in a 401(k) or IRA as specified in U.S. Code 408 (Individual Retirement Accounts).

Some general guidelines on the permitted forms of Gold:

  • Gold coins, rounds and bars must be 99.5 percent pure
  • Gold must be sourced from a national government mint or approved refiner
  • Numismatic coins are not allowed
  • Gold coins in one, one-half, one-quarter and one-tenth ounce sizes are permitted
  • Some non-US Gold coins with 99.5 percent fineness are eligible
  • Fractional ownership of coins and bars is not allowed

Convert 401K to physical Gold

This is the fun step where you actually convert 401K to physical Gold by picking the specific Gold coins and Gold bullion that will be held in your Gold IRA.

Let’s say we have picked Goldco as our Trustee and Broker-dealer. We would then go their website and search for IRA-approved Gold products.

Depending on current availability we will be able to choose from products similar to the ones listed below:

  • Gold bars in multiple weights from several different refiners and mints
  • American Gold Eagles and Gold Buffalos
  • Proof American Gold Eagles *
  • Burnished Gold Eagles *
  • Canadian Gold Maple Leafs
  • British Gold Britannias
  • Australian Gold Kangaroos and Nuggets
  • Mexican Gold Libertads
  • Chinese Gold Pandas
  • Austrian Gold Philharmonics

* Never pay a premium for proof Coins or limited edition Coins. That recommendation is especially true for a Gold IRA where the physical Gold is going to be stored in an IRS-approved depository. In all likelihood you will never physically hold this Gold in your hands so what difference does it make whether it is proof or not?

Buy the form of Gold that has the lowest premium over the price of Gold Bullion.

The objective is to obtain the maximum number of ounces possible for a given amount of money.

For example, if the premium on Gold Libertads is lower than the premium on Gold Eagles, buy Gold Libertads. If a 100 gram Gold bar has a lower premium than three Gold Maple Leaf Coins, get the Gold bar.

Fidelity 401K Gold

Fidelity offers several Gold-related investments including a Gold IRA and the Fidelity Select Gold Portfolio in its family of Mutual funds.

With a long history dating back to 1946, Fidelity is one of the largest Investment management firms in the US today with over $2 trillion in assets under management and more than 25 million customers.

At its founding the company offered two Mutual funds. Today Fidelity offers Investment advice, Wealth management, Life insurance, and retirement services. Individual investors, Financial advisors, businesses, and institutional investors look to Fidelity for management of equity, fixed income, and balanced Mutual funds.

Investors seeking exposure to the Precious metals through a Gold IRA can feel comfortable with an Investment in Fidelity 401K Gold.

Fidelity Gold IRA

The Fidelity Gold IRA allows investors to purchase only whole numbers of Gold coins or bars. No fractional purchases are allowed.

This limitation simply means that investors will deposit funds into their Gold IRA in amounts equal to the cost of the physical metal they are buying.

For example, instead of investing an even $10,000 into the Gold IRA, an investor would select about 5 and ½ ounces of Gold products for purchase. At $1800 per ounce, that 5.5 ounces of Gold would be approximately $10,000.

Fidelity Select Gold Portfolio Overview (FSAGX)

The Fidelity Select Gold Portfolio fund (FSAGX) invests in the securities of companies that mine for Gold and other Precious metals.

Investors should understand that FSAGX does not purchase physical Gold or other Precious metals. The mutual fund only offers exposure to Gold via the Mining companies held in the fund.

In early-2021, fund assets totaled just over $2 billion invested in approximately 50 different companies. Top holdings in FSAGX include Randgold Resources, Barrick Gold, Newmont Mining, and Agnico Eagle Mines.

Roll over 401K to Precious metals

Investors can roll over a 401K to Precious metals as long as the metal meets IRS specifications.

In general that means Bullion bars and Coins of specified fineness, and Coins from government mints.

Gold, Silver, Platinum, and Palladium are the four Precious metals allowed by the IRS.

Investors wanting to hold the fifth Precious metal, Rhodium, inside their 401K or other tax-preferred retirement vehicle are out of luck.

401K rollover to physical Gold

Details, details…

Like all investments, Gold IRAs have important details and characteristics. When you are planning your 401K rollover to physical Gold here are a few points to keep in mind.

Beneficiaries, Representatives, and Interested Parties for the Gold IRA

Like all retirement accounts, you will need to designate beneficiaries, representatives, and interested parties for the Gold IRA.

After specifying a primary beneficiary and contingent beneficiaries (if desired), you will have the opportunity to designate one or more representatives and interested parties.

A Representative for the Gold IRA would have full access to the account and the ability to execute transactions at their sole discretion. This is equivalent to granting the person a Power of Attorney.

During the process of setting up a Gold IRA it should never be necessary to give someone a Power of Attorney. If you are asked to sign a Power of Attorney designating someone or some entity as a Representative, don’t walk, run away.

Designating an Interested Party for your Gold IRA may make sense if you are working with an Investment advisor or Financial planner. By specifying these people as Interested Parties the account Trustee and Custodian will be able to speak with them without you being on the line.

Understand that an Interested Party does not have authority to execute transactions in your account. You still control all transactions in the account but you don’t have to be on the phone every time your Investment advisor needs to talk to the Gold IRA account Trustee or Custodian.

Where Your Precious Metals Will Be Stored

Keep in mind that there are three parties involved in a Gold IRA: the Investor, the Trustee, and the Custodian.

In most cases the Trustee will be a Precious metals Broker-dealer.

The Trustee usually has established relationships with IRS-approved metals depository facilities and the Investor chooses one of those depositories to serve as the Custodian for their Gold IRA.

Listed below are some of the most widely-used Gold IRA storage facilities in the US:

  • Citadel Global Depository
  • Delaware Depository
  • Brinks Global Services USA
  • International Depository Service
  • Texas Precious Metals Depository
  • Texas Bullion Depository
  • A-M Global Logistics

Reviews of “Best Gold IRA Companies”

If you do a Google search looking for reviews of “best Gold IRA companies” you will find numerous results.

At first glance it may appear that these review sites are providing value by helping you narrow down the large field of Gold IRAs to just the best 5 or 6 companies.

After looking at a few review sites, however, you may notice that they all look pretty much the same. That’s because they are all either affiliate marketers or lead generators and they are all trying to separate you from your hard-earned money.

These internet marketers are typically paid an upfront fee and a commission on the gross value of your Gold IRA rollover. The only ‘value’ these marketers provide is pointing you at a company where you can setup a Gold IRA. And in many cases they are pointing you at the Gold IRAs with the highest transaction costs and management fees.

As always, caveat emptor, especially on the internet.

Best Gold IRA Companies 2020

Understand that using the word “best” in an internet search has a predictable result.

This search term is going to bring out the affiliate marketers and lead generators because they can smell money in the water. 

As an Investment strategy, identifying the best Gold IRA companies in 2020 could provide some value. We might take a list of the best companies in 2020 and assume that those top performers would continue to outperform in 2021 and 2022.

To create this list we would first need to define criteria for being ‘best’.

What are we looking for in a Gold IRA? What factors are most important?

Is it lowest transaction and management fees? How long the company has offered Gold IRA products? How long the company has been in business?

How do we find a Gold IRA company that we can trust?

Find a Reputable Gold IRA company

Since we are dealing with physical Gold that will be stored on our behalf, perhaps trust is the single most important factor for us to consider.

It is unlikely that an internet search for the ‘best’ Gold IRA will actually lead us to a company that we will feel comfortable with as conservative Investors.

As an alternative method for finding a Gold IRA, we might consider starting from the trust angle.

Which of the Investment management companies are we already familiar with? And more importantly, which of them can we trust to manage our hard-earned money?

Unless we have a compelling reason to do otherwise, it is probably best to stick with large, reputable companies for our Gold IRA accounts.

If you are already a client of Fidelity Investments investigate their Gold IRA (discussed above) and compare it to other offerings like the ones below.

Most of the Gold IRA companies offer free Investor Kits if you visit their website. 

Precious metals IRA company


Patriot Gold Group

Birch Gold


Regal Assets

Noble Gold

Gold IRA

Year founded

BBB rating

Minimum Investment





Patriot Gold Group













Noble Gold





This 401K to Gold IRA rollover guide has focused on buying Gold for retirement in a tax-preferred account.

By buying physical Gold with 401K money we can secure the ultimate store of wealth for ourselves and our beneficiaries, while taking advantage of the tax benefits available to US investors.

If we have questions or concerns we can reach out to the representatives at the Gold IRA companies in the table above. As part of their customer service all of these Precious metals IRA companies are happy to assist consumers.


Bryan V Post is a California-registered Investment Advisor Representative specializing in the Precious metals.

He is the founder and CEO of Satori Traders LLC, a California-registered Investment Advisor.

Bryan has worn numerous hats during his life:

Engineer, Portfolio manager, Precious metals Investor, Technical analyst, Proprietary trader, Swing trader.