Traditional Gold IRA vs. Roth IRA: What’s the Difference?

There’s an old saying, “You reap what you sow.” It means the crops you harvest in the future come from the seeds you plant today. 

Gold IRA investing is similar. 

Traditional and Roth IRAs both provide, but the harvests will be a bit different. 

We will take a closer look at Gold vs. Roth IRAs and familiarize you with their similarities and differences

What Traditional Gold IRAs Have in Common With Roth IRAs 

Considering a Gold IRA vs. Roth IRA is like choosing between two of your children—both are great but different. 

Let’s explore the similarities.

Each type of individual retirement account is for long-term investing. 

You may contribute up to $6,500 annually if you’re under 50 years old or $7,500 if you’re 50 or older. 

Penalty-free withdrawals begin at age 59½.

Roth and traditional Gold IRAs hold the same group of IRA-eligible precious metals. These gold bars and coins help ensure the long-term viability of your account. They must be:

  • 99.5% pure
  • New, uncirculated, and government minted coins
  • Bars manufactured by companies traded on the COMEX and other exchanges

You may transfer any IRA you currently hold into a Gold traditional or Gold Roth IRA.

A 401(k), or similar account, is eligible for a rollover into a Gold IRA if:

  • You are at least 59½
  • It is held by a previous employer

All eligible transfers and rollovers are tax-free and penalty-free. 

How Traditional IRAs Are Different From Roth IRAs 

The process for contributions and withdrawals is where we see the biggest differences between Gold vs. Roth IRAs

You contribute to your traditional Gold IRA (or Silver IRA) with pre-tax funds. You can typically deduct those contributions in the tax year you make them. 

You fund your Roth IRA with after-tax dollars. Contributions are not tax-deductible. 

At age 59½—when eligible withdrawals may begin—your Roth IRA withdrawals are tax-free. You already paid taxes on the money used to fund the account, and no matter how much it has grown, you have no more tax liability. 

The IRS will tax withdrawals from your traditional Gold IRA. They are considered earned income and will affect your existing level of taxation. 

Contact your tax consultant or certified public accountant (CPA) for more information. 

Is a Traditional or Roth Gold IRA Right for Me?

The only differences between the Gold Roth IRA vs. Gold IRA are how you contribute and withdraw your funds. 

Both can be right for you if you are concerned with:

  • Having a hedge against inflation
  • Owning a tangible asset
  • Diversifying your portfolio
  • Investing in an asset that probably won’t go to zero
  • Preserving your spending power

Learn More About Investing in a Gold IRA 

The seasoned Gold IRA professionals at Advantage Gold will help you understand your options. 

For nearly a decade, we have guided clients through the process and will show you how easy it is to own gold in your IRA. 

As the highest-rated precious metals investment firm, we pride ourselves on making the process simple, fun, and reassuring. 

So check out some of our thousands of 5-star online reviews, then give us a call or click the link and let us know how to contact you. 

We are here and happy to help.

Talk to you soon!

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