If you’re new to buying gold, the prospect of jumping into the precious metals market can seem daunting. That’s especially true if you’re thinking about starting a gold IRA.

A gold IRA can be an effective way to protect your tax-advantaged assets with precious metals, but gold IRAs aren’t something with which many people have a lot of experience. And the thought of putting thousands of dollars of your hard-earned savings into an account that you don’t know much about can feel risky.

But thousands of people have already benefited from owning precious metals in a gold IRA, and gold IRAs are becoming more and more popular. If you’re thinking of starting a gold IRA to help safeguard your retirement savings, here are some answers to frequently asked questions that you might find helpful.

1. What is a gold IRA?

A gold IRA is an individual retirement account (IRA) that owns gold and other precious metals. Unlike most conventional IRA accounts that own financial assets like stocks, bonds, and shares in various funds, a gold IRA owns physical gold coins or bars.

2. How do I fund a gold IRA?

A gold IRA can be funded in numerous different ways, including annual contributions like other IRA accounts. But one of the more popular ways to fund a gold IRA is through a rollover or transfer from an existing 401(k), 403(b), TSP, IRA or similar account.

Funds can be rolled over from existing retirement accounts into a gold IRA tax-free, allowing you to bypass limits on annual contributions and buy more gold than if you were to rely solely on annual contributions, which are limited to $7,000 in 2024.

3. How do I roll over funds into a gold IRA?

A rollover into a gold IRA functions in the same way as any 401(k) to IRA rollover. If you’re moving funds from an IRA into a gold IRA, the IRA to IRA transfer works in the same way as any other IRA transfer.

First you’ll open a gold IRA account. Then you’ll contact your existing plan administrator or IRA custodian and inform them that you want to move funds from your existing retirement account into a gold IRA.

Once you fill out your current custodian’s forms and satisfy their requirements, your funds can be moved from your current retirement accounts into your gold IRA.

4. How long does a 401(k) rollover or IRA transfer take?

The 401(k) rollover or IRA transfer process will depend a great deal on how quickly your existing retirement plan administrator or custodian processes your paperwork, releases your funds, and sends them to your gold IRA custodian.

In some cases it could only take a couple of days to process the rollover and get your funds transferred. In other cases it may take one or two weeks.

Many times the delays in processing are due to your current plan administrator wanting to make absolutely sure that it’s you requesting the rollover, and not someone else looking to get their hands on your money.

5. Do I have to pay taxes on gold IRA assets?

The rollover process from your existing retirement accounts to a gold IRA normally occurs tax-free. Once your gold IRA is funded, it is subject to the same rules and regulations as any other IRA account.

A Traditional gold IRA can invest with pre-tax dollars, and taxes are paid when you take a distribution. A Roth gold IRA invests with post-tax dollars, and no taxes are paid on qualified distributions.

All the same rules apply to Traditional and Roth gold IRAs as to all other Traditional and Roth IRAs, including rules regarding penalties, required minimum distributions (RMDs), etc.

6. How much gold can I own in a gold IRA?

You can own as much or as little gold as you want in a gold IRA. But because gold IRA accounts are subject to fees, we generally require that you have at least $25,000 available to roll over into a gold IRA, so that the fees don’t end up being too large a percentage of your assets.

7. How much does a gold IRA cost?

The cost for holding a gold IRA varies depending on which gold seller you work with, which gold IRA custodian you choose, and which bullion depository you choose to store your metals.

In general you can expect to pay a one-time account setup fee and annual administration fees to cover the costs of processing and managing your gold IRA assets. Storage fees can vary depending on where your gold is stored, whether you want segregated or non-segregated storage, and whether you want additional layers of security.

Expect to pay about $50 for an account setup fee, around $80 for your annual account management fee, and between $100-150 for annual gold storage. That means you can expect to pay somewhere in the ballpark of $200 a year or so in fees.

In many cases these fees are flat, so whether you have $30,000 or $3 million in your gold IRA, you’re paying the same fee.

8. I already own gold coins. Can I move them into a gold IRA?

No. Gold that you purchase for a gold IRA must be gold that you don’t already own. Trying to use gold IRA assets to buy gold coins you already own would violate rules against self-dealing.

That is considered a prohibited transaction that could subject you to taxes and penalties. It can be helpful to familiarize yourself with the IRS regulations surrounding prohibited transactions before you start a gold IRA.

9. Can I buy Krugerrands with a gold IRA?

Like all IRA accounts, a gold IRA account is forbidden from acquiring collectibles. Collectibles include any metal and any coin, with certain important exceptions.

Those exceptions are codified at 26 U.S.C. 408(m)(3), which exempt modern gold, silver, and platinum American Eagle coins from the definition of collectible. In addition, any gold, silver, platinum, or palladium bullion that satisfies the minimum fineness requirements for a contract market is IRA-eligible.

This means that any gold bullion coin with a minimum fineness of .995 is IRA-eligible. Because the Krugerrand coin is 22-karat (.917 fineness), it is not eligible to be acquired by a gold IRA.

Many popular older bullion coins are not IRA-eligible, including Austrian 100 Corona restrikes, pre-1933 US gold coins, French and Swiss 20-franc gold coins, and older UK sovereigns. Despite this, there are numerous newly-minted gold coins that are IRA-eligible, and most mints today that produce gold coinage produce gold coins that are minted with enough gold content to be IRA-eligible.

10. Can I hold other precious metals in my gold IRA?

Yes, a gold IRA is a precious metals IRA that can hold any IRA-eligible precious metals. This includes coins and bars made from silver, palladium, and platinum.

11. Can I store my gold IRA assets at home?

No. By law, your gold IRA assets must be managed by an IRA custodian, as with any other IRA account. This means that your gold IRA assets will need to be stored at a bullion depository.

Some companies purport to offer a “home storage gold IRA” which they claim allows you to start a gold IRA and store your gold IRA assets at home. This falls afoul of federal law, and people who have tried to do this have paid the price by being subject to significant taxes and penalties.

12. Do I actually own the gold in my gold IRA?

Yes, your IRA actually owns the gold that is held in it. You don’t own gold certificates, or claims to physical gold, but rather actual physical gold coins and bars. And you decide which IRA-eligible gold coins or bars you purchase for your gold IRA.

13. Can I take possession of the gold in my gold IRA?

Yes, you can take possession of the gold in your gold IRA when you choose to take a distribution. You can choose to take a distribution from your gold IRA in physical metal, i.e. the gold coins or bars you have in your gold IRA, or you can sell them and take a distribution in cash from your gold IRA.

14. Is the gold in my gold IRA safe?

The gold in your gold IRA is stored in bullion depositories that offer world-class security. Once you have set up your gold IRA and decided to purchase your gold, you will decide where you want to store your gold.

Goldco works with established bullion depositories that offer state of the art security to ensure that your gold remains safe and secure.

15. How do I know the coins I’m buying are real?

Goldco works directly with mints around the world to source gold coins, many of which are exclusive to Goldco. This helps to ensure a steady supply of gold coins for our customers, even during periods of heavy gold demand and shortages of physical gold.

Working directly with mints also ensures that the coins you buy from us are 100% authentic. Buying gold from Goldco, you can rest assured that the gold you buy from us is real.

Still Have Questions?

If you have any other questions about a gold IRA, the benefits of a gold IRA, or how a gold IRA works, Goldco’s representatives are happy to answer your questions. Call Goldco today to learn more about how a gold IRA can help you secure your financial future.

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