The Basics of Precious Metal IRAs

Gold in IRAs presents a tangible asset that many consider able to stand the test of time—and the peaks and valleys of the volatile stock market. But gold isn’t the only precious metal that can add diversity in your portfolio. Silver, platinum, and palladium are permissible in IRAs, too. In fact, many people use precious metal IRAs to achieve diversity, and they find it comforting to hold assets that can offer a monetary solution in times of economic hardship.

Why Invest in Precious Metals?

Precious metals have long been considered a solid and stable investment for retirement portfolios. Typically, gold and silver translate to currency across the globe, which offer a hedge against the decline of the dollar, political and Silver bars and gold coins on a black surface representing assets for a precious metal crisis, and protection against future inflation. The trifecta of issues currently ongoing in America (civil unrest, a pandemic, and the unemployment rate) is certainly reason to consider a precious metals IRA for your own portfolio.

Additionally, precious metals are liquid assets and, depending on demand, can be traded quite quickly and lucratively on the market with the right strategy. For example, it might be easier to find a buyer for gold coins than an investor in gold bars. If your investing goal is to make a fast trade for an immediate return in your IRA, coins may be the best route. Bars and larger quantities of precious metals can be used as long-term assets.

IRS-Approved Assets for Precious Metals IRAs

Don’t just go for the gold. There are other precious metals available for your IRA.

The IRS defines many popular coins as collectibles, and therefore, not permissible in IRAs. However, a self-directed retirement plan is allowed to hold certain types of precious metals as assets. There are numerous silver, gold, and platinum coins (and bars), as well as palladium bars your precious metals IRA can hold as assets.

Below are just a few of the different types of precious metals that are permissible in self-directed IRAs. There are rules for precious metals in IRAs, though, as well as notes to the rules. Gold, silver, and other investment pieces must be of a certain “fineness” to qualify as an admissible asset in retirement plans.

IRA Rules for Popular Precious Metal Investments

Gold:  must be of .995 minimum fineness per IRS

Includes American Eagle, American Buffalo, Canadian Maple Leaf coins, and bars or rounds

Silver:  must be of .999 minimum fineness

Includes American Eagle bullion and proof coins, Canadian Maple Leaf, and Mexican Libertad coins, and bars or rounds

Platinum:  must be of .9995 minimum fineness

Includes American Eagle proof coins and bullion, Australian Koala, and Isle of Man Noble coins, and bars or rounds

Palladium: must be of .9995 minimum fineness

Includes bars or rounds

Notes to the Rules for Precious Metals in Your IRA

  • Numismatic coins are not permissible; the only semi-numismatic coins allowed in IRAs are Proof American Eagles (in gold, silver and platinum).
  • Uncirculated American Buffalo coins are permissible, but proof coins are not allowed.
  • All bars and rounds must be created by an approved refiner (or other approved assayer) or by a national government mint and must meet the minimum fineness requirements stated above.

There are additional options not listed above. But, since the IRS is very specific in the types of precious metals allowed in IRAs, it is best that you consult with an expert in these assets to help you determine which ones you purchase using IRA funds.

Closing Thoughts from Advanta IRA

When you think of investing in precious metals in your IRA today, chances are you wonder about bitcoin in an IRA, too. In light of its historic ascent to $57,000 a coin, experts predict bitcoin’s rise to continue, and a good many consider it an alternative-asset darling. But, just as many still feel that gold is the more secure bet. With a proven track record spanning thousands of years, gold is certainly less volatile and doesn’t depend on cyberspace for its value. Either way, both gold and bitcoin are alternative investments that have a potential strategic place in your IRA.

Advanta IRA is a self-directed IRA administrator with clients who invest in gold and other precious metals as well as also bitcoin in their retirement plans. If you have questions or want to open a precious metals IRA, contact us today.

About Scott Maurer

Scott is an attorney and a graduate of the University of Florida Law School. Scott started his career with Advanta IRA in 2006. His experience with various investment types and their unique processes makes him an invaluable asset. Scott holds the designation of Certified IRA Services Professional (CISP) and leads engaging seminars and webinars that educate the public on the intricacies of self-directed IRAs.