Why you should open a gold IRA today
Gold is a popular investment asset today — and it also has a longstanding historic value. But to get the most from your gold investment, it's helpful to invest in the way that works best for you.
While some might prefer indirect exposure to gold through stock in mining companies or funds that hold these stocks, others may value investing in physical gold bars and coins instead. But for long-term investors who want to use gold for retirement security, a gold IRA can carry some big benefits.
Learn more about how you can invest in gold today with a free information kit.
Why you should open a gold IRA today
A gold IRA is a self-directed version of a tax-advantaged individual retirement account (IRA). Like regular IRAs, your gold IRA may be a traditional, Roth or SEP IRA. You can use it to invest in gold and other precious metals, and will be subject to the same annual contributions limits and distribution requirements as a regular IRA.
Today, the price of gold is down compared to the near all-time highs from earlier this year, but investors have still benefited from steady growth over the past several months. As inflation continues to keep prices elevated and recession fears linger, it could be a good time to consider gold investing.
Here are a few of the best advantages of gold IRAs today:
Diversify your portfolio
When you invest in physical gold through an IRA, you'll gain direct exposure to the precious metal. Gold not only has historical value and is recognized as a form of currency across the globe, but it also offers potential market benefits for your long-term retirement investments.
Gold's value is non-correlated to traditional assets like stocks and mutual funds, meaning its value generally remains stable (or may even rise) when markets face a downturn. That makes it a good asset to use as a portfolio diversifier. When your other assets are down, gold's stability can help mitigate any losses.
Gold also tends to hedge against inflation, because its value often runs inverse to the value of the U.S. dollar. When inflation pushes the dollar's value down, gold's price often increases. In these cases, gold can help you retain purchasing power through cycles of inflation.
It's important, however, to make the right gold allocation to make the most of these benefits. Gold doesn't experience the same long-term growth as investing in the stock market can, so experts typically recommend keeping your investment under 5% to 10% of your overall portfolio.
Find out more ways gold could make a good addition to your portfolio with a free investors kit.
IRA advantages
Because gold IRAs have many of the same account details as regular individual retirement accounts, you can get a lot of value from the retirement benefits they offer.
Depending on the type of IRA you choose, the tax advantages can work differently. While a traditional IRA may be funded with pre-tax money, your Roth IRA investments are made after tax and can be withdrawn tax-free at retirement.
While investing in physical gold may be appealing for some investors who want to maintain access to their gold bars or coins, the tax advantages of IRAs may help you actually gain more value over the long-term and continue to benefit from gold in your retirement years.
How to open a gold IRA
To open a gold IRA, you'll need both eligible gold and an IRS-approved custodian to help store it.
Because gold is typically considered a collectible, the IRS only allows certain gold bullion that meets quality standards to be invested in IRAs. The IRS also requires investors to work with an approved custodian to help manage gold IRA accounts. You may take on one-time or annual fees for these services, so it can pay to compare different options before you buy in.
You can work with a gold investment company to help you through this process. The company will work with you to open your account, buy eligible gold and even connect you with a custodian. Learn more about working with a gold investment company to open and fund your gold IRA with a free investment guide.
The bottom line
Retirement-minded investors who are considering adding gold to their portfolios may find a lot of value today in gold IRAs. Not only can this type of account help you add physical gold to your investment plan — and take advantage of its long-term value — but you'll also enjoy the tax benefits that individual retirement accounts offer.
Before you make any changes to your financial plan, including opening a new investment account, consider speaking with a trusted financial advisor who can help you determine the right path for your goals.
