Why Invest in Precious Metals?
Precious metals are liquid assets and, depending on demand, can be traded quite quickly and lucratively on the market.
Typically, gold and silver translate to currency across the globe, which offers a hedge against the decline of the dollar, political and financial crisis, and protection against inflation.
Also, the cost of gold is generally not affected by rising interest rates. For these reasons, precious metals have long been considered a stable investment for retirement portfolios.
Investing in gold, silver, palladium, and platinum offers exceptional IRA diversification and potential appreciation. These alternative assets are not available in your typical retirement plan. You must use a self-directed account that allows alternative investments.
Precious metals allowed in your IRA
- Gold, silver, platinum, and palladium (in forms and grades approved by the IRS)
- Stocks in mining companies
- Exchange Traded Funds (ETFs)
The IRS defines many popular coins as collectibles, and therefore, not permissible in IRAs. But there are numerous silver, gold, and platinum coins and bars, as well as palladium bars your precious IRA can hold as assets.
How to Invest with Your IRA
- As the IRA owner, you choose the dealer you want to work with
- You choose the desired (and IRS approved) quality, grade, price, and form of precious metals
- You’re unable to personally hold the physical assets, so you choose the depository institution for this purpose
Rules for Precious Metal Investments
Below are some of the different types of precious metals that are permissible in self-directed IRAs. Take note of the IRS rules for these assets in IRAs. Gold, silver, and other investment pieces must be of a certain “fineness” to qualify as an admissible asset in retirement plans.
Gold:
- Must be of .995 minimum fineness
- 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
Additional rules:
- 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.
