July 20, 2023 |

How to Open a Precious Metals IRA

Many investors—just like you—are looking to expand and protect their retirement accounts. 

Whether you have questions about how to protect your assets from inflation, geo-political turmoil, or an impending recession, you may find that a precious metals IRA is a potential solution. 

From detailing how to open a precious metals IRA, to educating you on what is a precious metals-backed IRA, this guide will arm you with the knowledge to move forward. 

What is a Precious Metals IRA? 

A precious metals IRA is a self-directed individual retirement account that allows you to own physical precious metals—as an investment tool—inside the account.  

Much like the individual retirement account that you may be familiar with, a precious metals IRA is designed to be a tax-advantaged account. At age 59 ½, you may begin withdrawing funds with no penalty.

Although commonly known as the Gold IRA or the Silver IRA, there are several precious metal IRA options. 

What Precious Metals Are IRA-Eligible? 

Before learning how to open a precious metals IRA, you should understand which metals are eligible for your new account. IRA-eligible precious metals include:

  • Gold
  • Silver
  • Platinum
  • Palladium

The IRS has strict guidelines on the quality, purity, and sourcing of each metal type. 

  • Coins must be struck by a national government mint. They must meet minimum fineness standards, and be new, uncirculated, and in perfect physical condition.
  • Proof coins must still be encased in their original packaging and have their certificate of authenticity.  
  • Bars and rounds must also meet fineness standards. They must be manufactured by government mints, or approved refiners and assayers. 

Fineness and purity standards vary, depending on the precious metal. For coins, bars, and rounds:

  • Gold must be 99.5% pure
  • Silver must be 99.9% pure
  • Platinum must be 99.95% pure
  • Palladium must be 99.95% pure

How to Open a Precious Metals IRA 

Opening a precious metals IRA is easy. A trained account executive—like those at Advantage Gold—will walk you through the process. 

In a few easy steps, you can have physical gold, silver, platinum, and palladium acting as the foundation to your retirement fund.

Open a Self-Directed IRA Account

The first step is to find the best precious metals IRA that meets your needs.  

A self-directed IRA is available as traditional, Roth, or Simplified Employee Pension (SEP). If you already own one of these plans, you can easily transfer it tax-free and penalty-free into a precious metals IRA. 

If you are age 59 ½ and own a 401(k) or similar plan, or if you own a 401(k) from a previous employer, you may roll over that plan into a self-directed IRA that will allow you to own precious metals. 

Fund Your IRA

There are three ways to fund your new precious metals IRA:

  • Transfer
  • Rollover
  • Cash contribution

A transfer occurs when you move funds from one IRA to another IRA. If you currently own an IRA, it can be converted to the self-directed precious metals IRA. You can use the funds already in the account to purchase and store your precious metals inside of your new IRA. 

A rollover applies if you have an eligible 401(k) or similar retirement account. You can roll over your eligible account—without penalty or tax implication—into a precious metals account. You can then fund your metals purchase with the available money from the 401(k). 

A cash contribution occurs anytime you add money to a new or established account. You can contribute $6,500 per year up to age 72. Once you turn 72, you may contribute up to $7,500 per year.

Depending on the type of IRA account, your cash contribution may be tax-deductible in the year you make it.

Check with your tax advisor or CPA for more guidance. 

With Advantage Gold as your trusted dealer, you’ll have various options of eligible coins, bars, and rounds. 

Each has unique qualities and may serve different purposes for your portfolio. You can mix and match to suit your preferences. 

Select a Depository

The metals you own in your IRA account must be stored in a depository for safekeeping. 

Depositories are IRS-approved vaults that meet standards for safety, accounting, and insurance. 

The Delaware Depository is one of the most popular choices. Others include Brinks, JP Morgan Chase, and HSBC Bank. 

You may choose from any of the eligible depositories. 

A custodian is the keeper of your account. They approve the activity of the IRA account and ensure the transactions that you want to execute are allowed inside of your IRA. The custodian also completes all IRS reporting and sends you account statements.

Typically, your trusted IRA dealer will partner with a specific custodian.

Advantage Gold partners with Strata Trust for custodial services. Strata Trust is one of the industry leaders in the self-directed IRA, and has many years of service and dealings with depositories. 

Ready to Open Your Own Precious Metals IRA? 

Now, when someone asks, “What is a precious metals-backed IRA?” you can explain it from start to finish. 

The precious metals IRA can give your retirement plan protection and potential appreciation. You will own some of the finest metals available, and they will be stored in your choice of the most reputable depositories in the country. 

Getting started is easy. Call us, or simply click the link and tell us how to contact you, and an Advantage Gold account executive will guide you through every step of the process. 

We’re here and we’re happy to help.

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