A Precious Metals IRA Factsheet
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If you’re looking to diversify your retirement account, nothing offers a better deal than precious metals. These precious metals do more than just sit idle in your jewelry box, in their physical form.
They’re an excellent form of investment for your self-directed Individual Retirement Account (IRA) making your investment portfolio diverse and less risky. This is better than investing in something else because you can use precious metals as leverage to earn tax exemption.
Isn’t this a better way of increasing your retirement wealth? Before you jump right at the opportunity, it’s better to learn a few facts about this investment.
Why have Precious Metal in an IRA
Gold, silver, platinum and palladium all come under the umbrella of precious metals. If you want to minimize risks and diversify your investment portfolio for retirement, there’s no better option than precious metals.
Not only are they a hedge against financial crisis but also offer something tangible to rely on. Having precious metals in your IRA seriously cuts down investment volatility and risk. This way, your retirement savings can weather an economic downtown, and protect your post-retirement needs sufficiently.
Many critics claim that investment in precious metals is a non-income generating investment. But the tax-efficient shelter that it provides helps increase potential gains.
Types of Precious Metals Investments
Previously, only gold and silver coins were allowed to be included in self-directed IRAs. However, after the signing of the Taxpayer Relief Act in 1997, the allowable types of metal expanded to include platinum and palladium. While coins or bullions were only permitted as collectibles earlier, they were also sanctioned by 1997 as types and varieties of gold and silver.
Among the categories of precious metals that are specifically permitted are American Eagle coins in gold, silver, and platinum, bullions that meet requirements for fineness and State-issued coins.
Federal IRA Restrictions to Note
If you’re convinced about investing in precious metals, you must browse through these federal laws about IRA restrictions.
- Gold products should be 99.5% pure.
- Silver products should be 99.9% pure.
- Platinum and palladium products should be 99.95% pure.
- Metal bars, rounds or coins must be manufactured by a refiner accredited by a national government mint or an acclaimed authority such as NYMEX or ISO 9000. They should meet the requirements of minimum fineness.
- Proof coins must be packaged in their original mint packaging and should come with a certificate of authenticity.
- Small bullion bars must be made to meet exact weight requirements. This excludes 400-ounce and 100-ounce gold, 50-ounce platinum, 100-ounce palladium, and 1000-ounce silver.
- Non-proof bullion coins should be in perfect condition that’s free from damage and doesn’t show signs of circulation.
If you’ve read through these specifications, you might want to get started with your IRA procedure.