Gold IRA mistakes to avoid
When you're planning for retirement, protecting your nest egg is just as important as growing it. You want to ensure your investment dollars stay safe from market fluctuation and economic turmoil so they'll be there for you in your later years.
A great way to do that is by investing in gold. Gold has historically been proven to weather economic turbulence and provide reliable returns over the long term. And by opening a gold IRA, you can enjoy these benefits as well as the tax perks that come with this type of retirement account.
But to invest wisely, it's important to avoid some common pitfalls investors fall into. Learn more about gold IRAs with this free information kit.
Gold IRA mistakes to avoid
Don't let these mistakes derail you when opening a gold IRA.
Choosing the wrong type of IRA
There are several types of gold IRAs, each with its own rules, regulations and tax advantages. If you don't fully understand each one and consider your retirement goals, you may not get as much from your investment as you hope.
Take the time to examine the differences between these accounts, including contribution limits, withdrawal rules, required minimum distributions and tax implications. A financial advisor can help you determine the best IRA for your needs.
Choosing the wrong custodian
When you open an IRA, you'll need to select a custodian to hold and manage the IRA's assets and ensure the account complies with all applicable rules and regulations. This custodian must be IRS-approved, and they should also charge fair fees and have a solid reputation.
Don't choose the first custodian you come across. Do your research, read reviews and compare multiple custodians to find one you can trust with your investment dollars.
Not considering fees
You'll need to pay fees to open and maintain your gold IRA, including setup, administration, storage and transaction fees. These fees can eat into your earnings, so it's important to ask any custodian you're considering what their fees will be to minimize these costs.
See how a gold IRA fits into your retirement plan — request your free investors kit today!
Investing too much
Experts generally recommend keeping 5% to 10% of your portfolio in gold. That's because gold's steady returns can help minimize the risk from more-volatile assets, such as stocks. However, these returns are relatively moderate, so you should leave room in your portfolio for higher-growth assets.
That said, how much you allocate to gold depends on your age, risk tolerance and investment goals. To identify the right target number for you, speak with a financial advisor to review your unique situation.
The bottom line
A gold IRA can be an excellent way to diversify your investment portfolio, reduce risk and protect your financial future. But it's essential to stay away from some common mistakes to get the most from your investment.
Do your homework to understand the different types of gold IRAs and how they fit into your retirement goals. Research multiple custodians and make sure you know all the fees they charge. In addition, determine the right amount to invest based on your investment needs.
Finally, don't hesitate to reach out to a financial advisor for customized guidance. They can help you go over all this and more to maximize your earnings and set yourself up for a more secure financial future.
