Once you enter the precious metals rabbit hole, it feels like there is almost no way out. The advertisements are a bombardment after the first time that you make a search related to gold, silver, or even retirement accounts. What is all the fuss about, then? Well, for one thing, there are many different ways that we can get involved in the precious metals trade. The market is vast and so multi-faceted that we have a lot of options available to us. That is one of the main reasons people decide to begin, but there are others too. I will be going over several of them in today’s article!
What is an IRA?
Put simply, an IRA is anindividual retirement arrangement. These are retirement accounts that are intended for long-term savings and thus offer tax benefits to the holders. They are similar to 401(k) accounts in that way, but there are some differences. I would recommend talking to a financial advisor to determine which type would be better for you – they will probably be better equipped to help you in this manner. The most important thing to know is that there are a few different types of IRAs, each with their own pros and cons, and the main difference is that these do not require you to involve your employer at all (while a 401(k) does).
What Does this Have to do with Gold?
That sounds well and good as far as retirement accounts, but what does that have to do with gold or precious metals? Well, did you know that you can create an individual retirement account where your main holding is gold bullion (or stocks, EFTs, etc.)? That is where they are connected!
Types of Gold in Investing
Before I go too much further in regard to how you can open a precious metals IRA; let me discuss with you some of the different types of gold that you can use for investing. The most common type is known as bullion, which are the gold bars that we are familiar with. These come in several shapes and sizes; but in recent years they have been standardized a bit in order to make transactions easier. This pure gold is usually preferred in retirement accounts because it is harder to fake them; and if you have them certified, they tend to be a good value. They are also fairly easy to liquify depending on the size of bullion that you have. So, that is why they are often recommended for beginners of investing in precious metals. Gold coins are another fairly common type, though it should be noted that not all are allowed in these accounts. You can look at pages like this one, https://goldco.com/precious-metals-ira/gold-ira/; to get an idea of which are accepted, and which are not. There is a percentage of pure gold requirement for most IRAs in particular; so coins such as the American Golden Eagle are allowed while some others are not.
How purchase a coin?
So, before you purchase any coins, I would recommend that you consult a list or a financial advisor who is familiar with the worth of them. That is how you can keep yourself safe from investing in coins that have little to no true value in terms of their content. Another way you can get involved are known as futures contracts. These are roughly what they sound like – an agreement to purchase gold at a future date from a specific broker. The main thing to remember with this option is that you agree to spend the current worth of gold at the time the contract is made. So, if the value goes up, you can get a great value – but if it goes down, you might be down some money. The final method I will touch upon in this article is investing in stocks for companies that are involved with the production or trade of gold. This can also be a slightly risky choice, as there is never a guarantee that a company will perform well or meet the current value of bullion, but for those looking for less hassle (i.e., less care for bullion), it can be a solid choice.
Is it Worth it to Invest in Gold?
Now, I feel I must provide a disclaimer first: do not consider this article definitive financial advice. I am simply providing you with my opinion based on my own experiences in this field. I would say that in general, getting into precious metals and commodities is a worthwhile investment. They very rarely deplete in value, despite the fact that the market may appear volatile on the surface. You see, this is because historically, they have retained their worth. Gold serves as a part of many cultural practices along with being a status symbol for many. It is a matter of pride to own jewelry and be able to show it off; especially in relation to weddings! So, if you are still uncertain, that might be a bit of helpful context. However, my ultimate advice is to speak with your accountant or financial advisor. They should be able to steer you in the right direction in terms of your financial needs and securing your future. Saving for retirement is a very big deal. It is certainly not something that we should take lightly, which is why I am recommending a bit more caution than I perhaps would otherwise. Never be afraid to consult with gold brokers and custodians and ask what they have to offer in terms of services. While the latter are typically not allowed to provide financial advice; the former certainly can, so they are a resource we should utilize. After all, they are there to help.
Thankfully, most websites offer ways to chat with agents in real time; do we do have options even if we dislike talking on the phone with people. Either way, it is a good idea to check in on your current portfolio first!