Precious Metals
When things begin to feel uncertain, people tend to grasp for what they know or what they’re familiar with. There’s a sense of comfort that comes from the familiar.
When it comes to economic uncertainty, that familiarity can come from safe haven assets, which provide safety and security during tough times. For many people, those safe haven assets include physical, tangible assets.
For most of us, our wealth isn’t physical. Our bank accounts don’t get mailed to us, our 401(k), IRA, and other retirement accounts aren’t on paper, and even our paychecks aren’t physical entities.
We don’t get paid cash for our work, let alone a physical check, almost everything is done electronically or online today. While that may make our lives easier in many ways, it also can leave us panicked when our normal everyday experience is threatened.
If you looked at your online bank account, your retirement account, or your brokerage account and saw the sums dwindling, how would you feel? How would you react, and how would you go about trying to protect yourself and your finances?
For many Americans, that attempt to help protect themselves might come through tangible physical assets like precious metals. Precious metals may be denigrated in some corners as pet rocks, but if you own these “pet rocks” you likely won’t have to worry about the company whose stocks or bonds you (don’t) own going bankrupt.
Nor do you have to worry as much about the value of your dollars being devalued by inflation, because precious metals have an impressive track record of helping to hedge against inflation.
These characteristics of precious metals as safe haven assets and inflation hedges are making them an increasingly popular asset option for more Americans.
Many people are buying precious metals through precious metals-backed IRA accounts, which you may see referred to as a precious metals IRA, gold IRA, gold-backed IRA, silver IRA, or silver-backed IRA. These retirement accounts can help you harness the power of precious metals to help protect and defend you through difficult times.
A precious metals IRA is just an IRA account that holds physical precious metals coins or bars. Many people have never heard of precious metals IRAs before because most IRA custodians don’t manage precious metals assets.
As a result, many retirement account holders may not be aware that they can own gold, silver, and other precious metals in an IRA retirement account with all the same tax advantages as any other retirement account.
While most people think of gold and silver when they hear the term precious metals, there are over a dozen metals that have been described as precious metals. But only four of those precious metals are eligible for acquisition through a precious metals IRA.
When you hear the term precious metals, you probably think of gold first and foremost.
Fort Knox. Mr. T’s jewelry. Scrooge McDuck’s money bin.
Throughout history, gold has been synonymous with wealth.
Precious metals IRAs that acquire gold are known as a gold IRA. They can hold physical gold coins or bars, which are managed by an IRA custodian and stored at a bullion depository.
Silver often plays second fiddle to gold, but it can provide additional asset growth and portfolio diversification. In some cases silver can even outperform gold.
Silver’s use as an industrial metal makes it slightly different than gold in its price movements, as demand from various sectors of industry can influence the price of silver.
Platinum’s best known use is in catalytic converters in the automotive industry. It’s also used in jewelry. Numerous mints produce IRA-eligible platinum coin and bar products.
Palladium is also used in catalytic converters, and its price has seen significant movements in recent years. At one point its price was even much higher than gold’s.
While palladium coins and bars are less common even than platinum, there are still some IRA-eligible palladium coins and bars available.
There are numerous benefits to owning precious metals. Here are four benefits of buying precious metals through a precious metals IRA.
One potential benefit of owning precious metals is the opportunity to help protect your wealth. Gold and silver in particular have been favored as wealth protecting metals throughout history.
As soon as the first hint of a crisis occurs, people start rushing to buy gold and silver. We saw this in 2008, as prices rose in response to increased demand, again in 2020, and once again today.
Precious metals can also serve as a hedge against inflation. This is especially true for gold, which over the long run has maintained its purchasing power while the US dollar has become increasingly devalued.
During the stagflation of the 1970s, gold and silver both made annualized gains of over 30% over the course of the decade, far outpacing both markets and inflation. Many people today are hoping that precious metals can help them protect against the continued threat of inflation.
Diversifying your portfolio with precious metals is another beneficial aspect of owning physical metals. While gold and silver are perhaps the more popular precious metals when it comes to diversification, platinum and palladium can’t be forgotten.
Finally, if you choose to buy precious metals through a precious metals IRA, you gain the benefit of tax-free asset growth and favorable tax treatment. Many people like to hold physical precious metals coins at home, but owning precious metals coins in an IRA can also be beneficial.
With a Traditional precious metals IRA, you would purchase your precious metals with pre-tax dollars, grow your assets tax-free, and then only pay taxes when you take a distribution.
With a Roth precious metals IRA, you would buy precious metals with post-tax dollars, grow your assets tax-free, and pay no taxes when you take a qualified distribution. And you can take your distribution from a precious metals IRA either in cash or in physical precious metals.
Like all tax-advantaged retirement accounts, precious metals-backed IRAs are subject to IRA rules and regulations. Familiarizing yourself with those rules and regulations can help you avoid unintended and unwanted tax consequences.
All IRA accounts are forbidden from acquiring collectibles. Attempting to use IRA assets to purchase collectibles is considered a distribution of assets and could trigger taxes and penalties.
The tax code lists certain items that are considered collectibles, and it includes any coin or metal.
For the purposes of that definition, however, certain coins are excluded from consideration as collectibles. This includes a handful of coins produced by the US Mint, such as Silver American Eagle and Gold American Eagle coins, as well as any coin or bullion of gold, silver, platinum, or palladium produced to a minimum fineness that would be accepted for futures contracts.
What this means is that in order to be eligible for purchase through a precious metals IRA, any gold coin or bar needs to be at least 99.5% pure, any silver coin or bar needs to be at least 99.9% pure, and any platinum or palladium coin or bar needs to be at least 99.95% pure.
If you’re looking to buy precious metals coins through an IRA, there are numerous choices out there for you. You won’t be able to choose classic coins such as South African Krugerrands, British Sovereigns, older Morgan silver dollars, or Swiss 20 Franc coins, as their metal contents aren’t high enough to make them IRA-eligible.
But mints around the world today produce millions of coins that are IRA-eligible, and Goldco works directly with many of those mints to get you those coins.
If you’ve done enough reading about precious metals IRAs and self-directed IRAs, you’ve probably come across something known as a home storage IRA. These are purported to be precious metals IRAs that allow you to own precious metals within an IRA and store those metals at home.
If that sounds like it’s too good to be true, it’s because it is. All IRA assets in any IRA account are required to be managed by an IRA custodian.
So if you try to set up a home storage IRA and use IRA assets to buy precious metals coins and bars that you store at home, it would likely be treated as a distribution of assets and end up costing you in taxes and penalties.
This is why it’s important not to get seduced by stories that make it sound like you can have your cake and eat it too. Stick with trusted partners like Goldco who have years of experience helping our customers navigate the process of purchasing metals for their precious metals IRAs.
All IRA assets are required to be managed by a custodian. If you already have an IRA account, say with a brokerage, you’re probably already familiar with the process of working with an IRA custodian, even if you don’t fully realize it.
Most IRA custodians don’t offer precious metals as an option because they don’t want to have to manage precious metals assets. So you’ll have to find a custodian who offers precious metals management services, or partner with someone like Goldco who works with precious metals IRA custodians.
Once you fund your precious metals IRA and buy your coins or bars, your assets will be stored at a bullion depository. Goldco partners with secure depositories to ensure that our customers’ assets remain safe and sound.
As with any other IRA, your precious metals IRA will be subject to requirement minimum distributions (RMDs).
For precious metals IRAs that are Traditional IRAs, RMDs are required once you turn 73. There are currently no RMD requirements for the original owners of Roth IRAs.
All the other IRA rules and regulations apply to a precious metals IRA, including those about early distributions and associated penalties. Whether your precious metals IRA is a Roth IRA or a Traditional IRA, the same rules and regulations apply as they would to any other IRA.
If you’re already familiar with the IRA rules and regulations, you may already know many of the rules pertaining to precious metals IRAs. But if you don’t already know the IRA rules and regulations, you’ll want to start learning them, or consult with a tax advisor or financial advisor before making a decision about your retirement assets.
If you think that a precious metals IRA might be the right choice for you, give the experts at Goldco a call today. Ultimately the decision about whether or not to start a precious metals IRA is yours to make, but it can help to be as educated as you can be before you make a decision.
Whether you have an orphaned 401(k) that you want to start performing better or a current retirement account that you want to help protect, learning more about a precious metals IRA can help you get on the path to helping safeguard your retirement savings.
Don’t let your hard-earned money fall victim to potential recession, insidious inflation, or any other financial calamity. Call Goldco today to start your precious metals IRA journey.
This article was originally published in December 2022 and was updated in June 2025.
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DISCLAIMER: This site is general in nature and not tailored to the specific goals of any individual. Purchasing precious metals may 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. Customers should understand that all purchases have some degree of risk. Customers should make certain that they understand the correlation between risk and return. Commodities involve risk and are not suitable for all investors. There is no assurance that commodities, i.e. precious metals, will achieve their objectives. Return and principal value will fluctuate and your portfolio, when redeemed, may be worth more or less than the original cost. 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.
