Precious Metals
When times get tough and investors feel the need to protect their wealth, they naturally look to safe haven assets. Over the past several years there’s one safe haven asset that has stood out head and shoulders from the rest: gold.
Gold has protected investors’ wealth for centuries, acting as a bulwark against rising inflation and economic turmoil. In times like these, with continued economic uncertainty, it’s no surprise that investors continue to seek the safety and security of gold.
You probably remember the 2008 financial crisis, and how it negatively affected your finances and the savings and investments of millions of Americans. Financial markets lost more than half of their value, and American investors saw years or decades of savings and investment wiped away in a matter of months.
Those who had the good fortune to own gold back then remember how well gold performed during the crisis and its aftermath. And those who didn’t hold gold remember gold’s performance too, with many vowing that they would buy gold to protect themselves against the next crisis.
That next crisis may very well be on our doorsteps right now, and thousands of investors have already prepared themselves by buying gold. That investment demand has helped push gold to all-time highs this year, and this could only be the beginning of a tremendous bull run.
But while many people have already taken advantage of buying gold to help protect their wealth, many others are still learning about the role gold can play in protecting them. They may not fully understand how buying gold coins and gold bars can help safeguard their portfolios.
Gold can be a powerful tool in helping safeguard your savings, including your retirement savings. And with a little bit of knowledge, you too can protect your assets by buying gold.
Did you know that you can roll over or transfer existing assets from tax-advantaged retirement accounts into an investment in physical gold coins and bars?
Did you know that those rollovers and transfers can occur tax-free, allowing you to lock in gains from your existing investments and benefit from future gains in the gold price?
And did you know that the process to do that can start with something as simple as a phone call to contact experts who have helped people just like you protect their assets with gold?
Keep reading to find out how buying physical gold coins and bars can benefit your retirement savings.
If you’re not already familiar with the benefits of owning gold, here are five of the top reasons to do so.
Gold is, first and foremost, a tangible asset. Whereas stocks are an investment in a part of a company, and bonds are a promise to pay, gold is something that you can hold in the palm of your hand.
Stocks can completely lose their value if companies go out of business. Bonds can become worthless if their issuers default.
But gold can’t default or go out of business. It just sits there maintaining its purchasing power and growing in value year in and year out.
Coins have become a less popular means of payment in recent years due to their bulk in comparison to bills. But when it comes to gold, it can be easier to hold and transport large amounts of wealth with gold coins than with cash.
$50,000 in gold coins can fit in a coin tube in the palm of your hand. It can easily fit into your pocket. The same amount of money would require 500 $100 bills, which would be much bulkier and more difficult to carry around easily.
Many investors buy gold to hedge against the possibility of rising inflation. With the recent experience with high inflation, and the uncertainty of future inflation, gold’s importance as an inflation hedge has become more apparent.
The Federal Reserve seems to have become more tolerant of higher inflation rates, and there’s no guarantee that this decade won’t end up seeing a return of stagflation. That’s why many people are scrambling to buy gold, to help protect themselves against the possibility of continued high inflation.
Gold’s ability to maintain its value over time is well known. The purchasing power of an ounce of gold has remained relatively stable over the past century or so, while the purchasing power of the dollar has fallen over 95%.
That isn’t likely to change anytime soon, and as the dollar continues to weaken due to persistent inflation, gold’s value could continue to rise.
You’ve probably heard about the importance of diversifying your investments, but how well diversified are they really? Many people think that investing in a variety of stocks and bonds is enough diversification.
But in a systemic financial crisis in which bond and stock markets both sink, holding just those two types of assets doesn’t really protect you. It was just back in 2022 that both stock and bond markets saw major losses, and that wasn’t even during a recession.
During the next recession or financial crisis, assets that rely on Wall Street’s health for their performance could plummet, just like they did in 2008. And leaving all of your eggs in one basket could expose you to those losses.
Diversification means really diversifying, investing across asset classes and possibly introducing exposure to alternative assets such as real estate, commodities, and of course precious metals like gold. Holding a certain percentage of your portfolio in gold could help you ensure that your investments don’t all plummet when Wall Street’s luck changes.
No discussion of gold would be complete without mentioning its role as a safe haven asset. When markets crash and economies come grinding to a halt, gold asserts itself as the money that most people trust.
That’s why central banks continue to hold gold, as they realize that in the event of a breakdown of the monetary system, gold will be a necessary and vital part of any rebuilding. And central banks continue to load up on gold today, adding gold to their vaults at record levels.
In crisis after crisis throughout history, gold has played a role in protecting investors and their assets. And it will continue to play that role long after paper currencies have gone by the wayside.
Buying gold as a safe haven asset means that you understand the fragility of the modern financial system and the fact that everything you think you own could start to disappear in minutes when markets begin to collapse. Owning physical gold coins and bars is one way to protect yourself against that possibility.
Gold coins have been minted for thousands of years, and have helped fuel international commerce for centuries. Even today, gold coins remain an important product for many government mints throughout the world.
But when looking to buy gold coins, you need to make sure that those coins are suited to your goals. Not every gold coin will necessarily serve your purpose.
Those investors looking to buy gold through a gold IRA, for instance, will find that they aren’t allowed to acquire gold coins that are considered collectibles. For a gold IRA, modern Gold American Eagle coins from the US Mint and any gold coins with a minimum fineness of .995 (99.5% pure gold) are IRA-eligible.
That renders many classic gold coins, including investor favorites like the South African Krugerrand, ineligible for IRA investment purposes. Thankfully, there are still dozens, if not hundreds, of IRA-eligible gold coins available on the market today.
With so many different producers and designs to choose from, gold IRA investors can have their pick from many high-quality specimens. IRA-eligible gold coins are also available in a variety of different sizes and weights too, with most generally weighing between 1/10 ounce and 1 ounce.
All of us probably dream of holding a 400-ounce gold bar in our hands. The standard bar of international gold trading, those bars cost hundreds of thousands of dollars, putting them out of the reach of all but the richest investors.
But that doesn’t mean that you can’t buy gold bars of your very own. Mints and refineries around the world have taken to producing gold bars in sizes that ordinary retail investors can afford to buy. And with their high gold purity, many of these are also IRA-eligible gold bars.
Gold bars catering to retail investors are available in a wide array of sizes too, from tiny 1-gram bars all the way up to 1-kilogram bars (~32 ounces). That gives you the ability to tailor your gold holdings to achieve maximum flexibility in your gold holdings, particularly if you choose to purchase gold bars for a gold IRA.
With so much variety available on the market, there is a gold bar to serve everyone’s needs.
If you’re looking to buy gold coins and gold bars, an increasingly popular method of doing so is through a gold IRA. By starting a gold IRA, you can roll over or transfer assets from an existing tax-advantaged retirement account such as a 401(k), 403(b), TSP, IRA, or similar account into physical gold held in a gold IRA.
Your gold IRA then enjoys the same tax advantages as your current retirement account, but holds physical gold coins and bars that are stored at a bullion depository. And when you decide to take a distribution of IRA assets, such as a required minimum distribution (RMD) beginning at age 73, you can take your distribution either in gold or in cash.
Opening up a gold IRA isn’t difficult, and all it takes to get started is a call to Goldco to learn more about how gold can help benefit you. With thousands of satisfied customers over the years, the experts at Goldco can help you through the entire process, from the time you start exploring gold buying options to the time you purchase and deposit your gold coins or gold bars.
If you’re looking to protect your retirement savings against loss, hedge against inflation, or build up your wealth in the face of a weakening economy, why wait? Call Goldco today and put yourself on the path to securing your financial future.
This article was originally published in January 2021 and was updated in August 2024.
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DISCLAIMER: This site is general in nature and not tailored to the specific goals of any individual. All investments carry risk. Some of those risks associated with precious metals include the following: prices may rise and fall, which means the value of your metals may go up or down over time and you may sell for more or less than you paid. Past performance does not guarantee future results. Goldco cannot guarantee, assure, or promise future market movement, prices, or profits. Even though Goldco and its representatives are precious metals specialists, we are not licensed financial advisors and do not give financial advice. Additionally, Goldco cannot provide tax or legal advice and will not advise as to the tax or legal consequences of purchasing or selling precious metals or opening a Precious Metals IRA. Individuals should consult with their investment, legal or tax professionals for such services.
