How Does a Gold IRA Work?
A Gold IRA is self-directed. You choose the exact allowable instruments you’d like to invest in within the rules of the IRA. This differs from traditional 401(k) plans employers offer or sponsor. You generally have little say in what the 401(k) is invested in and typically only get to choose your level of risk, sectors that you’re interested in investing in, and the percentage of allocation into those sectors. You end up owning a basket of stocks in your chosen sectors but not much else.
As a Gold IRA investor, you can own physical, IRA-eligible gold coins or physical gold bars as a significant part of your portfolio. You can mix and match your gold with stocks and other paper-based assets. If you choose to invest only in your precious gold, that’s fully allowable, too. It’s your choice.
What’s the difference between a gold IRA rollover and a gold IRA transfer?
A Gold IRA rollover differs from a Gold IRA transfer in that a rollover moves funds from one type of plan (401(k)) to a different kind of plan (IRA). A transfer moves funds from one type of plan (IRA) to the same sort of plan (IRA).
Even though different custodians may administer the two IRA plans, they still have the same rules.
Benefits Of Rolling Over Funds Into A Gold Ira
Without knowing your circumstances, we can’t tell you for certain that you should roll over funds into a Gold IRA, but we can certainly share why some investors are rushing to get their funds rolled over. Many investors want to:
- Gain control of their investment portfolio.
- Lower their fees.
- Open up a wider array of investment options.
- Stay invested and tax-deferred while avoiding withdrawal fees and penalties.
Control
Many investors feel helpless and stuck with their 401(k) plan. They don’t know who manages it, why it is invested in a specific manner, or the motives of the controlling parties. After reaching the age of 59 ½, when there is no longer a withdrawal penalty or when an eligibility opportunity like separation of employment occurs, investors often jump at the chance to regain control of their hard-earned money. Many choose the Gold IRA because it offers choice and control.
Lower Fees
Exorbitant fees are often associated with 401(k) accounts. Because this type of plan is managed—typically by a big Wall Street investment firm—it may incur many fees that can eat away at your investment growth and savings.
Management, trading, and annual fees are just a few fees a 401(k) must satisfy. A Gold IRA typically has one yearly fee, which includes all administrative costs, paperwork costs, and even the expenses of safely and securely storing and insuring your gold in some of the world’s greatest depositories (vaults).
More Investment Options
Because a Gold IRA is self-directed, you have complete control over what you want to own and how much. Do you want to own gold coins and only gold coins? No problem. Like the famous fast food restaurant says: Have it your way. Keep in mind that Advantage Gold is not a financial advisor, and we cannot give any stock recommendations – we can simply help up the self-directed IRA. You decide how much you wish to allocate to which asset.
Stay Tax Deferred And Penalty-Free
Just because you’ve left a job, it doesn’t mean that your money has to stay tied to the employer’s 401(k) plan. If you have separated from your previous employer, you have the right to keep your investment funds tax-deferred and penalty-free by rolling them into a new Gold IRA. You will gain control without losing any advantages that a tax-deferred retirement account offers.