Gold Retired

Am I Eligible For a Roth IRA? What The IRS Wants You To Know

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Am I eligible for a Roth IRA?

Am I eligible for a Roth IRA? Which rules pertaining to the ownership of Roth IRAs must I be aware of? What are my options if I don’t qualify for this type of individual retirement account? If you have been looking for the answers to these questions, then this post will help you understand all you need to understand. All you need to do is read on till the end of the article to find out more. 

Introduction Gold Retired

Roth Individual Retirement Accounts, or Roth IRAs as they are popularly referred to, are well-known retirement savings vehicles that provide tax advantages to those who utilize them. Simply put, these accounts are funded using after-tax dollars. As much as there is no immediate tax break, the account owner also benefits by having not to pay taxes during their retirement years when taking withdrawals. 

Some of the main benefits of Roth IRAs over the also popular traditional IRA include: 

  • You are allowed to take tax-free qualified distributions
  • The ability to withdraw your preferred amount of the contributions made without incurring any penalties. 
  • Roth IRAs do not have the Required Minimum Distribution (RMDs) requirement. Traditional IRA  owners are required to start taking RMDs upon hitting 72 years. 

Do you, however, qualify for a Roth IRA, or do the current rules and regulations pertaining to the ownership of these IRAs disqualify you? Read on to find out. 

**Gold Roth IRA Rules | Let´s go through them in a simple way

The Income Limitations for holding a Roth IRAGold Retired

According to the IRS, any individual with an earned income can open a Roth IRA. Common forms of earned income include:

  • Compensation from an employer 
  • Earnings made by an individual who is self-employed. 

Other types of income that you can use to fund your Roth IRA include:

  • Taxable alimony as well as other amounts of money received by order of a divorce decree.
  • Any form of nontaxable combat pay 
  • Specific types of taxable non-tuition and stipend payments

The IRS rules state that money that is not considered compensation cannot be used to fund a Roth IRA. Some types of this money include:

  • Profits and earnings from rental income.
  • Income from pension schemes and annuities.
  • Deferred compensation 
  • Unemployment benefits
  • Non-taxable alimony. 

You are allowed to contribute to your employer-sponsored retirement plan such as a 401(k) and also open a Roth IRA, provided that you meet all requirements set by the IRS.

Roth IRA Income LimitsGold Retired

Just because you have an earned income does not mean that you will automatically be granted permission to open a Roth IRA. The IRS has to check whether your income falls within the set income limits requirements, as stipulated in the Taxpayer Relief Act of 1997. Lawmakers set these income limits to see to it that high-earning individuals do not create Roth IRAs to use as tax shelters.

You can open a traditional IRA and start making contributions, regardless of your income level. With a Roth IRA, however, the IRS requires that your Modified Adjusted Gross Income (MAGI0, fall within the set limits, for you to qualify to open an account. 

The eligibility to open and contribute to Roth IRAs is usually based on household income. The IRS makes routine adjustments to the MAGI limits, as well as the individual retirement contribution limits to cater to the changing rates of inflation. 

The income and contribution limits for individuals with different filing statuses in 2022

For this section, we shall take a look at the income and contribution limits for various types of individuals, based on their filing status.

Filing Status 

 2022 Modified Adjusted Gross Income (MAGI)

2022 Contribution Limits
Single, head of household, married filing but separately (and did not live with his or her spouse at  any time during the tax year)  Less than $129,000 $6,000 ( or $7,000 if 50 years or above) or AGI, whichever happens to be smaller
  At least $129,000 but less than $144,000 Contribution limits are reduced
  $144,000 or more Not allowed to contribute
Married but filing separately and the individual lived with his or her spouse at any time during that tax year Less than $204,000 $6,000 ( or $7,000 if  50 years or above) or MAGI, whichever is smaller
  At least $204,000, but less than $214,000 The contribution limit is reduced
  $214,000 or more Not allowed to make contributions
Married filing jointly or happens to be a qualified widow(er) Less than $204,000 $6,000 ( or $7,000 if 50 or above) or MAGI, whichever is smaller
  At least $204,000, but less than $214,000 The contribution limit is reduced
  $214,000 or more Not allowed to contribute

Backdoor Roth IRAs: Meeting the Needs of the Ineligible 

If you are a high-income earner who has been disqualified from opening a ROTH IRA or making contributions to one owing to the fact that your MAGI exceeds the limits set by the IRS, then you can still take advantage of a strategy known as a Backdoor Roth IRA maneuver. 

With this strategy, you can open and contribute to a Traditional IRA, which does not have income limits. You can then proceed to convert the traditional IRA to a Roth IRA. 

A backdoor Roth IRA maneuver may seem similar to a Roth conversion, but there is a difference in that with the backdoor Roth IRA, an account holder is allowed to make contributions to their Roth year after year for as long as they would like to, whereas, with a Roth conversion, the contribution mostly happens all at once, or follows an approach known as the Roth conversion ladder method. 

A backdoor Roth IRA maneuver is a viable long-term retirement savings approach, moreso for the high-earning young individuals who have a longer investment horizon. 

**What Are The Alternatives to Backdoors Roth IRAs Today?

Roth IRA Age LimitsGold Retired

Billionaire and renowned founder of Berkshire Hathaway, Warren Buffet once said that the secret to becoming successful is starting early. Time is your ally, moreso when it comes to taking advantage of the power of compound interest. A Roth IRA is a perfect choice for any investor who would like to start investing when they are young so that they can retire wealthy. 

There is currently no age limit for individuals who would like to open a Roth IRA. The only thing that the IRS will require of you is that you have an earned income. Even a teenager who makes some income through part-time jobs such as cleaning or babysitting can open and contribute to a Roth IRA.

The good thing is that the IRS does not care about where the funds that make their way into the Roth IRA are sourced from, provided that the funds are earned income. A teenager who earns $4000 during their summer vacation can save the amount through their Roth IRA, or their working parents or grandparents can make contributions to this teen’s Roth IRA. 

Frequently Asked Questions on “Am I Eligible for a Roth IRA?”FAQ

1. When can I start withdrawing funds from my Roth IRA?

You can withdraw the contributions (principal) you make to your Roth IRA at any time you wish to do so, without the IRS penalizing you. You cannot, however, withdraw the earnings on your contribution (principal), before 5 years since you made your first contribution are over. In addition to that, you must meet an additional qualifying factor, which is that you must be over 59 ½ years or older. 

2. How much can I contribute to a Roth IRA each year?

Currently, Roth IRA account owners are required to contribute no more than $6000 to their accounts if they are aged below 50. Those who are aged above 50 can contribute a maximum of $7000. Note that the IRS adjusts this amount from time to time, to cater to the everchanging inflation rates. 

3. I intend to open a Traditional IRA and a Roth IRA. What is the maximum amount I can contribute to the two retirement plans each year?

The maximum contribution limit of $6000 per year (or $7000 for those aged above 50) applies to all the IRAs an individual holds. If you, therefore, have a traditional and Roth IRA, you can only deposit a total of $6000 or $7000 to both accounts. You can, for instance, split your contributions as follows:

  • Traditional IRA  – $3000
  • Roth IRA – $3000

**What Should I do After Maxing Out my Roth IRA? Top Options?

4. What if I contribute to my IRA but I am not eligible?

Contributions made by those who are not eligible are perceived as excess contributions. These have tax consequences ( 6% per year for each year the excess amount is sitting in the account). You can avoid the tax penalty by withdrawing the excess amount and earnings before the tax year comes to an end. 

That will be all for today’s post on “Am I eligible for a Roth IRA?” I hope that you found it informative and that now you know whether you qualify for this type of IRA. Still not sure about what Roth IRAs are about and whether you qualify? Drop me a question in the comments section below and I will get back to you ASAP!

I wish you well, 

Eric, Investor and Team Member at Gold Retired!

How to Convert an IRA to Gold and Silver | It’s Quite Easy!

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how to convert an ira to gold and silver

In today’s article, we shall look at how to convert an ira to gold and silver. The recent economic trends have forced investors to establish the means to diversify their retirement investment portfolios in a manner that ensures that they are sheltered from market crashes. The conversion of IRAs to gold and silver has been one such approach, as you will learn in today’s post. Hop to the next section to begin discovering more about this topic. 

Introduction

In the present-day world, retirement investors are required to do all they can to protect their wealth from market forces such as inflation, volatility, the decline in the value of the dollar, as well as uncertainty. This is why many bona fide investors recommend converting a portion of one’s retirement investment portfolios to physical precious metals such as gold and silver.

This is popularly known as a Gold IRA rollover, a process that entails the transfer of one’s IRA holdings into their newly-created Gold IRA accounts so that they can purchase precious metal bullion. 

A gold IRA is structured in such a way that it allows you to own your precious metal assets either on a tax-deferred or tax-free basis. The gold IRA rollover process allows you to easily create such an account, fund it, and begin reaping the benefits of owning precious metal assets. 

N.B: A gold IRA can be used to hold any of the IRA-approved precious metals (gold, silver, platinum, and palladium bullion). You may, however, need to confirm with your gold IRA custodian about the precious metals that they support. 

Gold IRA Rules and Regulations | Put Gold in Your IRA 2022

What is an IRA transfer?Gold Retired

As a retirement investor, you are allowed to use your current retirement plan’s funds to fund a gold IRA in one of the following ways:

  1. IRA rollover
  2. Transfer

Rollover 

With this option, the custodian of your current retirement plan (e.g. Traditional IRA, Roth IRA, or SEP-IRA), gives you the funds you prefer to withdraw, after which you have about 60 days to deposit those funds into the new gold IRA. If you fail to meet this deadline, you will end up owing the IRS a 10% early withdrawal penalty on the amount received, if you are still under 59.5 years.

Transfer 

For a transfer, your IRA custodian follows up on your request to send the funds directly to the gold IRA custodian. With this option, no cash leaves the account, which generally ensures that you do not risk getting penalized by the IRS. This is the generally-preferred option since it takes away the temptation to start spending the funds, with the hope of recovering them and sending them to your gold IRA custodian. 

How do I Open a Gold IRA?

To open a gold IRA, which is essentially a more specific term that refers to a self-directed IRA that allows you to invest in gold and other IRA-approved precious metals, you need to find a custodian that specializes in such accounts. 

Here is a list of the best custodians you can check out.

Upon filling out the required paperwork, you will be required to wait for the gold IRA custodian to approve the application. 

Next, you will need to fund the newly-opened account, then proceed to choose the gold or silver you would want to invest in. You then have to direct the gold IRA custodian to buy the precious metals on your behalf, as is required by the IRS. 

After the purchase has been made, your gold and silver will be moved to an IRS-approved precious metal depository for storage. 

How to convert  your existing IRA into a gold IRAGold Retired

After you have created a gold IRA, converting the funds in your other retirement plan into gold and silver should be straightforward. Here are the steps you will be expected when dealing with most custodians:

1. Contact the administrator of your current IRA

Inform them that you want to convert your funds to gold and silver. 

2. Fill out the required paperwork

You may need to indicate in writing how much money you need to withdraw from your current plan. 

3. Wait for the IRA custodian to send you the funds 

Upon receiving the funds, you can proceed to deposit them into your newly-created gold IRA. You should do this within 60 days after initiating the rollover process. 

4. Select the gold and silver products you want to purchase

Note that only certain coins and precious metals are allowed for investment purposes when it comes to IRAs. Your custodian will help with ensuring compliance as far as this matter is concerned. 

5. Direct your gold IRA custodian to purchase the assets you selected

The custodian will use the funds you deposited into the account to purchase the chosen precious metals. 

6. The precious metal assets will be shipped into a depository for safe storage 

At this stage, you may come across some companies advocating for the storage of your precious metals at home. Be wary of such companies, since attempting to store your gold at home could lead to the IRS not only penalizing you but also doing a comprehensive audit on your holdings. 

After the 6th step, all that is left is for you to just access your account statements as you monitor the performance of your assets. Your gold IRA custodian (company) may have sufficient online tools to help you do this. 

Gold IRA transfer fees: What to Expect?Fee

The IRS does not charge any fees during a gold IRA transfer. Your account administrator could, however, charge a fee, though this is dependent on the existing company policies. It is, therefore, necessary for you to contact all your existing IRA custodians, as well as the gold IRA custodian, and request them to inform you about any fees that they will be charging you during the conversion of your IRA to gold and silver. 

==> How Much Does it Cost to Start a Gold IRA? What To Expect

What are the tax implications of the conversion of an IRA to gold and silver?Gold Retired

One of the main benefits of a gold IRA is that it protects you from incurring potential penalties that come with such a process.  With a rollover, you are subject to paying a 10% penalty if you do not deposit the funds received from your existing IRA’s custodian into your gold IRA within 60 days. You are also limited to a single rollover per year. 

If you decide to do a transfer instead of a rollover, the funds will be sent directly to your gold IRA custodian, which in itself minimizes the chances of you incurring additional fees and penalties. Also, since there is no money to be withdrawn and given to you, the money will not be subject to taxation by the IRS. 

Why should I consider transferring my IRA funds to a gold IRA?Gold Retired

There are several benefits that come with the transfer of your existing IRA funds into your newly-created gold IRA, including:

1. Opportunities for growth 

Just like any other asset, gold could grow in value. Its prices have risen over the past decade, and this essentially means that if the trend continues, then your portfolio will be worth more over the next half-decade or decade. 

2. Diversification 

It is not very wise to put all your money into a single asset or investment class. Gold and silver offer a great way to diversify one’s investments, hence reducing the overall risk level for their holdings. 

3. A hedge against inflation 

Whenever the value of the U.S. dollar drops, so does your purchasing power. Having precious metal investments protects you from such losses since the value of gold and silver generally outpaces the loss of value of the dollar. 

If you are not sure about the Gold IRAs and what they have to offer, you can request a gold IRA kit from popular gold IRA companies, or you can talk to your financial planner for them to advise you on how to go about it. 

Frequently asked questions on “How to Convert IRA to Gold & Silver.” FAQ

1. Which retirement plans are eligible for a Gold IRA Rollover?

You can do a complete Gold IRA rollover by transferring your funds from any of the following types of accounts:

  • Traditional IRA
  • Roth IRA 
  • SEP IRA
  • Defined contribution plans such as 403(b), 401(k), 457(b) and TSPS

2. Can I open a gold IRA and still hold on to my other IRA?

Yes, you can. You, however, need to consult with an IRA expert about the total amount that you can contribute to all your retirement plans. 

3. How many times can I roll over the funds in my existing IRA to my Gold IRA?

The IRS allows you to do one IRA rollover per year. If you attempt to do a second rollover, then you will risk getting penalized by the IRS. This law does not apply to the number of transactions that you can do within the IRA. 

4. How much will I pay in fees, during the Gold IRA Rollover?

The IRS and the government do not require you to pay any fees during the rollover process. Your custodians may, however, charge some rollover fees, and these may vary from one service provider to the next one. 

That will be all for today’s article on how to convert an IRA to Gold and Silver. I hope that you found it informative and that you now know what the process entails. If you have any questions about the process, and how you can go about it, drop them in the comments section and I will get back to you ASAP!

I wish you well,

Eric, Investor and Team Member at Gold Retired!

How to Invest in Gold in an IRA (Commonly Asked Questions)

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how to invest in gold in an IRA

In today’s post, we shall take a look at how to invest in gold in an IRA. Investing in gold through such a retirement investment structure has in the recent past been gaining popularity, more so due to the state of the global economy. In this article, I will take you through all you need to know if you are new to this industry, or if you simply want to educate yourself about Gold IRA investments. If that sounds interesting, then stay with me till the end of this post. 

Introduction 

If you are interested in owning some gold or investing in it with the hope that its price movements will be in line with your financial objectives, then owning a self-directed individual retirement account (SDIRA) account known as a gold IRA might be an excellent way to do it. With an SDIRA, you can invest in a wide variety of assets including precious metals, real estate, cryptocurrencies, and other assets that can help you not only grow your wealth but also diversify your portfolio. 

Investing through a gold IRA is not without its requirements. Read on to find out more. 

The limitations on how an investor can hold physical gold Gold Retired

To use a gold IRA to invest in physical gold, you need to follow all the rules and regulations stipulated by the IRS. The first rule is that you are only allowed to hold IRS-approved gold in your precious metal IRA. Whereas the list of approved physical gold options may change as time goes by, the IRS stipulates that all the gold must:

  • Have a purity level of 99.5%
  • Be sourced from a firm that is an accredited precious metal dealer. 
  • Come in its complete, original casing/packaging 
  • Have its certificate of authenticity
  • If you own gold coins, they must be uncirculated and not be damaged in any way. 
  • Be of the required unit weight. 

Another thing you need to know is that you cannot hold the physical gold by yourself. Although you are the rightful owner of the physical gold, it must be stored safely in an IRS-approved depository. Most IRS-approved depositories offer safe and insured storage of the assets brought to them by their clients. Your gold IRA custodian or gold IRA company will be more than willing to recommend a suitable precious metal depository for your assets. 

When will I access the gold stored invested through the gold IRA? Gold Retired

To start withdrawing the gold IRA without being penalized by the IRS, you need to be not less than 59.5 years old. Upon reaching this age, you can opt to withdraw the gold bars or coins and hold them in your preferred storage facility, or you can liquidate them and receive their value in cash instead. Investors who withdraw their gold before hitting 59.5 years end up paying a 10% early withdrawal penalty. 

Gold IRA Rules and Regulations | Put Gold in Your IRA 2022

Are there any benefits to owning gold through a gold IRA?Gold Retired

Buying gold through this type of retirement account may be a great way to safeguard your wealth. Some benefits you stand to gain include:

1. Protection of your wealth from economic downturns 

Having your money in gold helps minimize losses more so during economic downturns (e.g. stock market crashes). 

2. Portfolio diversification 

If you put all your investments in one basket, you risk losing a lot of money in case the economy is not favorable. Investing in gold is a great way to minimize the overall risk of your portfolio. 

3. Hedging your portfolio from inflation

The gradual decline of the value of the dollar is accompanied by a decline in purchasing power. Gold offers protection against any losses that may occur from such a decline, since its a store of value/wealth. 

4. Growth of your wealth 

Some investors hold gold over a long-term horizon, with the belief that its value could increase with time. Gold prices have risen over the past decade, which is a good signal to put aside some of the funds in physical gold in a bid to enjoy the long-term growth benefits. 

I must, however, not forget to state that investing in gold also presents some unique risks to investors. It is advisable to consult a financial advisor or accountant to help you understand whether holding some gold will align with your financial goals and objectives.

How do I fund a gold IRA to get started with the investment process?Gold Retired

To get started with gold IRA investing, you will need to open a gold IRA account. You can do this by contacting a reliable custodian, or a well-established gold IRA company. Such companies are charged with managing gold IRA accounts, and reporting to the IRS on your behalf, as the gold IRA investor. 

Upon creating your gold IRA with your company of choice, you can proceed to fund it in one of the following ways:

  1. Cash – You can use the funds in your bank account, in which case you are required to send a check or wire payment to your gold IRA custodian. 
  2. Rollover – You can also withdraw funds from your existing retirement plan, and deposit them into the newly-created gold IRA. You are required to deposit the funds into the gold IRA within 60 days of withdrawing them, to avoid getting penalized by the IRS. 
  3. Transfer – finally, you can instruct your gold IRA custodian to contact the custodian of your existing retirement plan, so that they can make arrangements for the transfer of all or a portion of your funds to the gold IRA. 

Do not forget that there is a limit to the amount that you can deposit into your self-directed precious metal IRA, which is $6000 for those below 50 years, and $7000 for those aged above 50. 

I want to open a gold IRA account, where can I find a gold IRA company?

There are many gold IRA companies out there, all with their varying customer experience, services, and fee schedules. You, therefore, have to take the time to compare what different firms have to offer, to ensure that you end up with the best possible deal. You can take a look at our list of recommended gold IRA companies, as you get started with your search for a reliable company. 

Frequently asked questions on “How to invest in a gold IRA?” FAQ

1. Can I use my existing retirement plans such as my IRA, and TSP? 401K, or 403B to invest in physical precious metals? 

You can only use your retirement savings to invest in physical gold or silver by rolling them over to a gold IRA. Your current employer-sponsored retirement plan may not support precious metal investments, so you have to make the necessary arrangements for a gold IRA rollover. It is also a good idea to speak to a gold IRA expert to determine whether your current retirement plan qualifies for a gold IRA rollover. 

2. Is it costly to open and own a precious metal IRA? 

The cost of owning a precious metal IRA may vary from one company to the other. You should, however, be prepared to pay annual storage fees for the precious metals, which is a cost that is not incurred by other IRA account holders. The cost of owning the gold IRA may as such be about $200+ more than the regular retirement plan, but this is all dependent on the gold IRA company or custodian you choose to work with.

3. What type of precious metals can I hold in my gold IRA?

You are allowed to hold any of the IRS-approved precious metals in your gold IRA, which includes gold, silver, platinum, and palladium. These precious metals must meet the fineness and purity standards set by the IRS, for physical precious metals that can be used in this type of IRA. Note that some gold IRA companies and self-directed IRA custodians do not support all IRS-approved precious metal investments, hence the need to do your due diligence. 

4. Where will my gold be stored? 

If you invest in gold through a precious metal IRA, then you should be ready to search for an IRS-approved precious metal depository, in which you can store the precious metal bars or coins. Avoid any company that lures you to open a gold IRA with a home storage option. 

That will be all for this post on how to invest in gold in an IRA. I hope you found it informative, and that you now know what it takes to hold some gold in such a retirement plan. Let me know if you have any questions with regards to what we have discussed herein- simply drop them in the comments section and I will get back to you ASAP. 

I wish you well, 

Eric, Investor and Team Member at Gold Retired!

Why Should I Invest in Silver? The Pros And Cons To Consider

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Why should I invest in silver?

Why should I invest in silver? As you may have discovered during your brief search about this precious metal, silver has been one of the preferred options for precious metal investors for a variety of reasons. In today’s post, we take a look at some of the things that make silver a go-to option for investors, as well as some of the downsides of this asset that you also ought to know. Hopefully, by the time you are reading the conclusion of this article, you will have decided whether you should really whip out your checkbook and purchase some silver. If that sounds interesting to you, read on to discover more. 

Introduction

It is quite natural for every wise investor to think about whether a particular asset is a good investment for their portfolio or not. That also applies to silver, owing to the fact that it has its upsides and downsides. Pros and cons are to be expected with any type of asset, and almost everything in life. We are, however, required to weigh the good and the bad, and if the good outperforms the bad, we can always take up the option at hand. Do the pros of investing in silver outweigh the cons or is it the other way round? Hop on to the next section to find out.

The Pros of Investing in SilverPros

Silver has been around for many years, which gives investors a sense of confidence that this precious metal will always find its place in the present-day global economy. Besides that, there are some other top reasons behind why they opt to purchase silver for their portfolios, including:

1. Silver is a tangible asset

One of the ways in which you can invest in this precious metal is by purchasing bars or coins. For many investors, having a tangible asset provides a much-needed sense of security. It appears that having something you can hold and see may at times give a sense of ownership, and this in itself is sufficient to influence investors to set aside a portion of their wealth to purchase silver. 

2. A hedge against inflation 

During times of economic uncertainty, investors tend to run to assets that have the capacity to hedge their portfolios against losses. Silver is one such asset. Despite being volatile over the short-term horizons, this precious metal is capable of beating inflation over the long-term investment horizons. 

3. Diversification Diversification

A significant number of people think that diversification is simply about having several different stocks in their portfolios. Seasoned investors will, however, tell you that diversification also involves holding assets in different classes, from different industries. Generally, assets that are correlated tend to experience price movements in the same direction. However, with uncorrelated assets, the price movements tend to follow different directions. 

During times of economic crisis, paper assets tend to be severely affected by market conditions. This means that investors who have taken shelter under different stocks, ETFs, funds, and other paper assets, may end up having a rough time.

The 2008 financial crisis is a great example of how bad things can get if an investor fails to diversify their portfolio in the right way. The good news is that adding uncorrelated assets such as silver to one’s portfolio can have significant diversification benefits.

4. Safe haven

As already mentioned, investors tend to look for “safety” during times of economic turmoil. When there is political and economic uncertainty, paper assets take a back seat to assets such as silver and gold. While both gold and silver tend to be appealing to most investors, not many of them have sufficient money to purchase gold in large quantities, hence silver gets some attention when the cost of investment is put into consideration. At the end of the day, the two metals end up playing the same role ( there may be some unique differences, however). 

5. Affordability Gold Retired

When many people are beginning their precious metal investment journey, they often have gold in mind and no wonder. Gold is the dominant asset in this industry, but as highlighted above, not everyone can afford to purchase a significant amount of gold to add to their portfolio ( an amount that will make sense from a profitability perspective). When the investors discover that they cannot afford the yellow metal, they often start looking for affordable alternatives. Silver tops the list of the most affordable precious metals to invest in. With $100, you can purchase enough silver to begin your journey as a silver investor. 

6. Higher returns than gold 

Silver has often been referred to as “gold on steroids”. This is due to the fact that while gold and silver prices move in tandem, silver generally outperforms gold, moreso during bull markets. If you are solely looking to achieve great profitability during a bull market, then you may have a better shot at it if you add some silver to your portfolio. “May” is the keyword to consider, since assets tend to defy all historical trends whenever there is a combination of unique market factors.

==>Best Silver IRA Companies | (Plus Top Features To Consider)

The risks of investing in silverDrawback

Before you invest a single penny in this asset, you should know that it also has risks that can potentially damage your portfolio. You should understand such risks so that you can decide whether you have what it takes to counter them in case you are exposed to them. Here are some of the most outstanding ones:

1. Volatility 

While silver can be a great asset to diversify your portfolio and hedge against potential losses, it is also subject to market forces such as demand and supply, which can make its prices quite unpredictable. Its prices are quite volatile in nature and have been seen to rise and fall faster than those of gold. 

2. Higher premiums on silver products

When you try to purchase any bullion product e.g. American Silver Eagle Coin, you will quickly come to the realization that the price of such products is generally higher than the spot price of silver owing to the premiums put in place by the silver dealers. If the demand for silver skyrockets, the premiums can go up pretty fast, making the idea of purchasing physical silver bullion less attractive. 

3. Weak return on investment

Although silver has its many benefits, in the absence of events that trigger sudden price rises, you may end up not getting an impressive return on investment. The good thing, however, is that the global unrest has created a perfect environment for silver investors to reap gradually as the years go by. 

Should I, therefore, invest in silver?

The answer to this question boils down to personal choice. As you have seen, investing in silver has its unique upsides and downsides. No asset is guaranteed to deliver on the promised benefits, but investors still go-ahead to make their bets. Unlike other assets, silver is quite affordable, and you can purchase a small quantity of this white metal just to see what its price movements are like in the short term and in the long term. 

Frequently Asked Questions on “Why you should invest in Silver?”faq

1. Is now a good time to invest in silver? 

As with any asset, the choice of the time to make an investment is dependent on the investor’s objectives. If you are currently thinking about how to diversify or hedge your portfolio against different market conditions, however, silver is worth considering, and you may need to add it to your portfolio now. 

2. Is silver a good long-term investment?

Historically speaking, this asset has performed quite well over the long-term horizon. Past results, however, do not guarantee future performance, so I give a clear go-ahead for one to purchase silver as part of their long-term strategy. 

3. Is silver better than gold? Gold Retired

Gold and silver have their unique pros and cons. For one to compare the two assets, they need to define the parameters of comparison, since gold performs better than silver in some areas, and silver outshines gold in others. 

4. Should I buy silver bars or silver stocks?

This entirely depends on your investment objectives. Generally, however, if you are looking for an asset that will give you a sense of security and ownership, or one that can offer protection against the state of the economy, then physical silver will be the go-to option. If you can stomach greater risk as you attempt to achieve profitability, then you may shop around for silver stocks (mining stocks). 

That will be all for today’s article: why should I invest in silver? I hope you found it informative, and that it will inform your investment decisions. If you have more questions with regards to this article, be sure to drop them in the comments section, and I’ll get back to you ASAP!

I wish you well, 

Eric, Investor and Team Member at Gold Retired!

How Much Does it Cost to Start a Gold IRA? What To Expect

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How Much Does it Cost to Start a Gold IRA?

How much does it cost to start a gold ira? This is one of the most commonly asked questions by people who are thinking about opening gold IRAs. I shall address this question at length in today’s post, so if you are here to find out how much it will take to open your new precious metal IRA, read on till the end to find out more. 

Introduction

Deciding to save and invest for your retirement can come with a lot of questions. Two of the most commonly asked questions that most investors raise are:

  • How much will it cost me?
  • How much will be the returns? 

While it is hard to address the type of returns that one should expect, owing to the ever-changing global economic landscape, we can easily identify the costs associated with opening a gold IRA. 

It is important to identify and quantify the fees and charges it will take for you to open and maintain your gold IRA since they can easily eat into your capital gains, and even lead to you having zero or negative returns at the end of the investment period. 

Some of the most common fees that you should expect to pay when opening your gold IRA with any type of Gold IRA service provider include:

  • Account setup and admin fees 
  • Precious metal product markups and commissions 
  • Yearly maintenance fees 
  • Storage fees

Gold IRA Setup and Admin Fees Fee

Whereas you are not mandated by the IRS or the government to pay rollover or transfer fees as you move your funds from your existing retirement plan to your precious metal IRA, this does not mean that there are no account application fees to be expected. 

You will often find that gold IRA custodians and administrators of gold IRAs will charge a certain fee that they refer to as the processing fee, in order to create the account. Generally, the administrators will charge different amounts based on the account features. In most cases, however, you should expect to part with around $50 in setup and admin fees. 

Gold markups and commissions pros

There are a couple of commissions that are involved during the buying of assets using gold IRAs. You have to be ready to part with the transaction fees to cater for the purchase or sale of precious metal products through their account. These fees are often assessed on a per-transaction basis.

The more the products you purchase and sell, the higher the fees you can expect to pay. There’s no avoiding transaction fees regardless of the type of administrator you choose. The administrator or custodian is merely passing on the costs from the bullion or coin dealers, as they do the transaction on your behalf. Every time the account custodian completes the transaction on your behalf, they charge a small commission, usually about $40 per transaction. 

The commissions should not be confused with markup fees over the precious metal spot prices that the precious metal dealers also often assess. In addition to the value of the precious metal products that you purchase, you will be expected to pay a premium. The premium is usually on top of the spot price of the gold, silver, platinum, or palladium bars, and may vary depending on factors such as:

  • The product in question
  • Current demand for the product
  • The precious metal dealer’s financial objectives.

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Annual account maintenance fees

Your gold IRA custodian cannot merely rely on the account setup fee that is payable only once, to oversee your gold IRA account activities. They will also request you to pay the yearly account maintenance fees, which are meant to cover:

  • The administration of the account
  • Processing of financial statements
  • Record keeping 
  • Reporting to the IRS 

These fees vary widely, but the typical range is $75 to several hundred dollars per year. It is a good idea to check and confirm the annual account maintenance fees. Your gold IRA custodian should clearly spell out these fees and should tell you about the means of communication they will use in case there are any changes. 

Some admins and custodians offer discounted annual maintenance fees in the first year. Others discount the fees based on how big the account size is. Beware of the custodians who use sliding scale fees models to arrive at the annual fees, since these may lead to you having to pay more money for investing in larger quantities of gold and silver.

You may not even realize it, but the fees charged based on this model may end up becoming exorbitant. If anything, you should stick to a company that has reasonable flat fees, so that you don’t have to worry about giving up a lot of your funds to meet such expenses. 

Storage fees Gold IRA Storage Fees

The IRS-approved depository will also request that you pay the annual storage fees to ensure that your precious metals are safely stored. Remember that all your gold, silver, platinum, and palladium products invested through a gold IRA must be stored in an IRS-approved depository that has off-site vaults, and that is separate from your account custodian. 

Precious metal depositories usually charge the annual storage fees, and all that your account custodian does is pass them to you. Note that the fees you end up paying are dependent on the depository you select. In most cases, these fees will range from 0.5% to 1% of the value of your account holdings annually, an amount that is based entirely upon the dollar value of the type of asset you own.

Some depositories may also have differing fee schedules, depending on the type of storage that you choose. There are two types of storage, which are:

  • Aggregated storage in the general vault
  • Individualized segregated storage

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Frequently asked questions on “The cost to start a gold IRA?” faq

1. How much, therefore, does it cost to start a gold IRA?

The fees required to start a gold IRA vary. There is no fixed amount of money that every investor can expect to pay to establish and maintain this unique investment account. The differences in the fees arises from:

  • The different account setup fees ( from one custodian to the next one)
  • Varying account maintenance fees 
  • Different markups and commissions
  • The differing storage fees 
  • Unique customer needs 

2. Which other fees should I  expect to pay?

There are also some miscellaneous fees that you must expect, such as wire transfer fees. Most IRA custodians will assess funds that you need to wire to them or to the precious metal dealers. Wire transfer fees may cost you about $25 for any outbound transaction that you initiate. You should request your gold IRA custodian to also disclose all miscellaneous fees as well during the account opening, to avoid getting hit with extra fees that were not previously brought up. 

3. What about taxes?

For starters, you may end up paying the taxes during the account opening process, or at the end of the investment horizon. This is all dependent on the IRA structure you choose, i.e. a traditional Gold IRA or a Roth Gold IRA. With a:

  • Traditional gold IRA – you pay the taxes at the end of the investment period
  • Roth Gold IRA- the fees are paid at the start of the investment period. 

4. How long does it take to open a Gold IRA? 

The gold IRA application process is quite short with most companies, and you can actually complete it in about 10 to 15 minutes. The account processing is also fast and can take about one business day for it to be completed. 

From there, everything else depends on how fast you will fund your account. As long as you have a fast and reliable gold IRA custodian, the transfers and rollovers should take about 10 days to complete. Note that funding the account through a mailed physical check may take longer. 

Also note that the timelines are bound to vary from one company to the next, so you should not take it up with your custodian if they take longer than you expect even when the delay is justifiable, or as a result of the way they have structured their account opening process. 

That will be all for today’s post on “how much does it cost to start a gold IRA?” Did you find it informative? Do you have more questions about this topic? Kindly let me know by dropping me a comment in the section below, and I will respond to you as soon as I can. 

I wish you well, 

Eric, Investor and Team Member at Gold Retired!