How to Convert Your IRA to Gold in 3 Steps
One of the greatest things about retirement funds in the United States is that you get a lot of freedom. By law, most Americans are allowed to keep a certain amount of their income in IRA accounts. These are shielded from taxes.
Thanks to the Roth amendment to IRA laws, you are taxed only once you pole money out of your IRA. You’re not taxed when you put your money into your IRA. This is a great incentive for rank intire Americans to invest. With that said, the problem is not so much ability to save and invest. The problem is that you have so many investment options out there. In addition to the usual suspects of stocks and bonds, you can also get into real estate. You can get into precious metals.
You can even get into stocks of emerging market economies like Philippines and India. Where do you draw the line? What is a good direction to take in terms of enhancing the investment value of your IRA? One of the best ways to enhance the value of your IRA of course is to invest in gold. Gold is one of the oldest, if not the oldest store of value that is almost universally recognized. Regardless of which point on the globe you select, chances are high that the people there will value gold. That’s how powerful and universal gold’s appeal is.
This is why if you’re looking to diversify your investment portfolio or add more value to your IRA, you might want to convert your IRA to gold. Here are the steps to do that.
1. Fund your account with cash
First and foremost, you need to have cash in your IRA account for you to buy gold. This is just common sense. There’s just so many ways to do this. You can use salary deduction. You can use after tax proceeds. You could use pretax proceeds.
The best way to fund your IRA in such a way that it doesn’t hurt your pocketbook is to use automatic deductions. As the old saying goes, out of sight, out of mind. You’re not going to miss the money if you don’t see the money. In other words, when you look at your paystub, you just look at the net amount and you basically just deal with it.
The last thing you want is for you to receive the money first and then be forced to put money into your IRA. Regardless of how you do it, you have to fund your IRA account with cash. This is the first step in figuring out how to convert IRA to gold.
2. Get an IRA Custodian
You can’t just manage your IRA. It’s a good idea to have an IRA custodian. These are usually professional individuals. More often, they are financial institutions.
For safety purposes, it’s always a good idea to transact your IRA business with a bank or other large financial institution. At the very least, you may have some insurance protection.
3. Find a Reputable Dealer
Now that you have cash in your IRA account, your next step is to find gold to buy with that cash. You’re basically going to be contacting your IRA custodian to issue a check to buy gold and put that gold in your account. A key element in a precious metals IRA is to find a reputable dealer. The best way to do this is to find a dealer that is industrially or professionally accredited. Why does accreditation work? Well, when you’re dealing with a business that is accredited by a third party, the third party is putting its good name on the line.
They are not going to ruin their name by accrediting thieves and liars. This is just common sense. The more accreditation a particular dealer has, the higher the likelihood that it is a reputable dealer. The higher the likelihood that it is a dealer that you can do business with.