How to Convert IRA to Gold
When the price of gold per ounce hit $1,000.00, the interest in investing in gold significantly increased. Gold has been a bright spot for investors, as the price of gold has steadily risen even as the stock market was crashing. For those who have decided to invest in gold, but also wish to capture the benefits of holding the investment within their retirement accounts it is now possible to do both. It truly is possible to convert your IRA holdings into gold.
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Instructions
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Gold Investment Type Will Determine IRA Strategy
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For those who are looking to hold gold within their retirement accounts, they have two fundamental choices. Investing in gold can be accomplished through the purchase of the actual commodity, or through an index investment, a type of stock which focuses upon investing in companies that mine and process the gold in addition to the actual commodity. Investing in the index is significantly easier, and can be accomplished by issuing a trade request through your broker or online trade desk. If your IRA has the ability to hold stocks or mutual funds, you can complete the trade very quickly. If it cannot, speak with your financial institution to see what you need to do in order to allow your IRA to do this.
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Create a new IRA account. If you have decided to hold the actual gold commodity itself within your IRA, this will require the creation of a new IRA account with a specialized company that offers this type of investment. Not many financial institutions offer this service, but they are out there. IRS regulations require that the gold either be purchased in gold bullion bars or gold eagle coins. Check with the financial institution that offers the ability to purchase gold within your IRA to see if you have to buy one or the other. Gold bullion bars are significantly more expensive than the gold eagle coins.
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Once you have decided your IRA investment strategy, you need to open your IRA with the institution that you have decided to utilize. Many will have websites where you can download the application forms for the new account, or a simple phone call can get you the forms in the mail. These forms will often require you to choose your account type (Roth or Traditional), depending upon your financial situation one or the other may be a better fit for you. Clarify with a tax adviser which is the best for you.
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Fund the account once it is opened and initiate the trade to invest in gold. Once the investment has been made, sit back and watch your balances hopefully grow.
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Tips & Warnings
Gold is an exciting investment, but like all investments any potential losses or gains is at risk due to market conditions. Investing in gold for the long run is a smart move, but always do your research.
The IRS does not allow you to take gold that you currently own and place it into an IRA.
