Gold IRAs are a special type of self-directed IRA that allows you to invest in physical gold and other precious metals, such as silver, platinum, and palladium. Investing in a gold IRA requires the services of a custodian bank, a broker to purchase gold, and an approved depositary to store gold. Like other self-directed IRAs, Gold IRAs can be Traditional or Roth. If this isn’t a priority for you, there are other ways to add precious metals exposure to your portfolio in addition to a gold IRA.
You’ll also need to choose a precious metals dealer who will make the actual gold purchases for your IRA (your custodian may be able to recommend one for you). Before you initiate the transfer, it’s important to calculate how much of your existing retirement savings you’d like to invest in your new Gold IRA. If you already have an IRA or 401 (k), either Regular or Roth, you have the option to convert some or all of your balance to a Gold IRA. Many people who open gold IRAs use funds from another IRA to do so, but it’s not a good idea to convert your entire nest egg into a gold IRA.
chosen Gold IRA company will help you get started by reaching out to your plan administrator with a request to transfer funds to your new Gold IRA. To avoid the possibility of having to pay taxes and penalties, your Gold IRA company can process the transfer on your behalf. A common way to fund a new Gold IRA account is to use funds that are already in another retirement account, such as another IRA, 401 (k), 403 (b), 457 (b), or Thrift Savings Plan, in accordance with IRS rules. If you want to hold gold outside of a retirement account (which means you can keep it at home), here’s more information on how to buy gold outside of an IRA.
A gold IRA company will help you set up your account and sell you the gold (or silver) coins or bars that fund it. To comply with the many regulations surrounding gold IRAs, you can’t store your gold at home or in a safe deposit box. Unless you have multiple retirement accounts, it would be very risky to convert your entire balance into a gold IRA. Some IRA companies guarantee that they’ll buy back the gold from you at current wholesale prices, but you could still lose money if you close the account, which is not usually the case when opening and closing regular IRAs.
They also perform the necessary administrative functions to ensure that your Gold IRA complies with all IRS regulations. Many people who want to avoid this risk instead have their Gold IRA company carry it out as a transfer from institution to institution instead of taking it on themselves.