Traditional IRA focuses on bonds, ETFs, and stocks. However, gold IRAs (see also our guide to owning gold in an IRA) will allow you to invest in physical properties so long as they are on the list of approved items.
If you want to know how to set up your own gold IRA (see also ‘What Is A Gold IRA? And How Does It Work?‘), you’ve come to the right place. This article will help you set up your gold IRA in only four simple steps.
Read on to learn more about how you can easily set up your gold IRA.
Before You Get Started
Before you open your gold IRA account, you should understand what a gold IRA account is. Various types are available, and all of these differ regarding how your money is taxed.
Two examples are the traditional route and the Roth IRA, meaning you pay your taxes before putting any funds in your account.
Traditional IRAs mean that it’s only when you withdraw the money later that you pay your taxes.
You should also consider the contribution limits. You can contribute up to $6000 annually if you are under 50.
Once you reach 50, you can contribute up to $7000 per year. You should also consider the other fees involved, such as set-up, storage, and custodian management fees.
All of these vary depending on the company you choose.
Gold can be an incredibly valuable investment, so you should remember this when you set up your account.
However, the value will jump higher during times of financial instability. It can be a stable investment when you understand what you’re doing.
Choosing A Gold IRA Company
The first step to starting your gold IRA is to find a company who you can work with.
Many gold IRA companies help you start your account, transfer funds, purchase your precious metals, and make sure that they are shipped to a secure storage area.
When choosing your gold IRA company, you should know that they will likely act as the custodian of your gold IRA account.
Various gold IRA companies offer their services to customers, each with various unique fees.
You should consider the reviews regarding their services, customer care quality, and the most affordable pricing.
By doing your research, you should be able to find the best gold IRA company for you and your retirement.
Upon choosing your company, you’ll need to do some paperwork to open your gold IRA and fund the account.
You must also have some ID, such as your driver’s license and any existing retirement accounts if that applies to you.
Funding Your Gold IRA Account
Now that you’ve opened your account, you need to fund it before you can start investing in precious metals. You have three options available to begin funding your account.
You could make a cash contribution for your funds, as you would with a traditional saving or investment account.
You can use cash, check, or even a wire transfer to make a cash contribution. However, you should consider any fees on the part of your bank if you choose the wire transfer option.
If you already have a retirement account that already exists, you could do a rollover and roll your funds to your gold IRA. You should get in touch with your account administrator, who can instruct you on how to do this.
You could even choose the cash distribution option. You can take funds from your existing account and then deposit your cash into your gold IRA by yourself.
But if you do this, you should do so within 60 days to avoid a 10% penalty.
As your third option, consider a direct account transfer. Fill out a form with your current administrator. You can also get your custodian’s help, and they can reach out to your administrator on your behalf.
When you choose a transfer, it can take up to five working days and is both penalty and tax-free. The third option is typically the most popular option due to ease of use.
Choosing Your Metals
Once you have funded your account, you can purchase your precious metals, such as gold, silver, and platinum.
However, be mindful of what you buy, as the IRS has strict rules on metals and their particular purity, to be kept in gold IRAs.
You should consult your custodian on the list of approved metals you can purchase to put in your account.
It depends on which company you’ve chosen to open your account with when you purchase metals.
Some companies will sell metals approved by the IRS, meaning you can buy any coins and bullion (see also ‘What Is Bullion?‘) from them directly.
However, other companies may require you to purchase any investments from a separate dealer, which will mean your custodian will need to buy the items for you in your name with the funds you’ve stored in your account.
Monitoring Performance Of Metals
Monitoring your account will depend on your account custodian.
In some cases, your gold IRA company will offer online dashboards that will enable you to monitor the performance of your metals (see also ‘How To Invest In Uranium‘).
However, this is not the case for all companies.
If you want regular updates, you should ensure this when you select your gold IRA firm.
You can ask the company before you select them to see if they can offer you these services should you request them. If they do, your custodian may be able to gain access for you to monitor these features.
Final Thoughts
Gold IRAs are easy to set up and don’t take long to open. Sometimes it will only take you between ten and fifteen minutes and open within a single business day.
You can begin withdrawing from your gold IRA once you’ve been 59 years old for at least six months. Before that, you will receive a 10% penalty on the withdrawal.
It’s vital that you do your research before you start investing and that you understand what you’re getting into before you get started.
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