How a Precious Metal IRA Can Help You Beat Inflation
Speaking of saving for their future, about 60 million taxpayers in the US own an IRA account. This Individual Retirement Account helps account holders plan for their post-retirement life. It helps them keep their assets secure in the Federal Reserve and allows those assets a tax-free growth up until their withdrawal.
While most people prefer their holdings in bonds, others prefer to have precious metal IRA accounts. Here’s a closer look:
What is a Precious Metal IRA Account?
A precious metal IRA account is a special self-directed retirement plan in which the owner deposits their savings in gold, silver, or any other approved precious metal. Over time, the value of this gold or any other precious metal increases tax-free to increase the retirement wealth of the account’s owner.
However, one thing that people don’t consider while counting their holdings in the retirement plan is the factor of inflation. So, what is inflation?
Inflation–what is it?
Inflation is an economic drawback in which the prices of goods and services increase within a particular region. It occurs when the prices of raw materials that are needed for the manufacturing industry increase. This increases the cost of the final product, which results in the loss of general purchasing power.
Inflation and IRA
Inflation can drastically affect your IRA. If the country sees even a 1% increase in inflation, you could lose about 34,000 US dollars from your retirement plan. This is because inflation depletes the purchasing power of people, which in return reduces the value of bonds and other fixed-income instruments circulating in the economy.
How does Precious Metal IRA Help?
Increase in Value of Gold
One of the top things to consider about investing in gold is that its price increases with inflation. As inflation occurs, investors turn to precious metals, increasing the demand for gold. A sudden increase in demand will cause the buying value of gold to spike, increasing the value of your precious metal IRA.
Value of Silver
Silver is widely used in the industrial sector, keeping it in high demand. However, the availability of this element is scarce, which often leads to a higher buying value. This keeps the prices of silver at a constant high, adding to the value of this asset held in reserves and saving accounts.
Diversification of Investment
Investing in precious metals can help you place your money in different directions instead of putting it all on bonds and stock certificates. This helps keep your portfolio protected and offers a hedge against any crises.
Orion Metal Exchange is the leading gold investment company in the United States, active in investments and consultations for over 50 years. We guide our clients for secure silver & gold storage investments and consultations regarding their precious metals IRA accounts.