How to Buy Gold With your 401k

People have held a portion of their wealth in gold for thousands of years. That’s because there’s only a finite amount of gold on the planet and it has proven to be able to consistently hold or increase its value over time. In times of economic uncertainty, when the value of many currencies are fluctuating wildly, gold continues to hold its value. This makes gold the perfect long-term investment asset. However, the average worker today has their retirement money stashed in an employer controlled 401(k) plan that does not allow them to invest in gold directly. You can change that.

Several Options Available

There are a number of easy and effective ways for workers to use some or all of the money in their 401(k) and invest in gold. With the steady rise in the value of gold over the past few decades, doing so can enable you to give a sizeable boost to the amount of money you will have in your nest egg when you retire. Learning how to start a gold 401k can help. Some of the options for using money from your 401(k) to invest in gold include:

1. Purchasing A Gold IRA2. Invest In Mutual Funds With Stocks In Gold Mining Industry Companies3. Use Exchange-Traded Funds (ETFs) To Invest In Gold4. Doing A Self-Directed IRA Rollover

Any of these options can help you transform your employer controlled 401(k) into a Gold 401k.

How To Start A Gold 401k

While transferring some or all of the money in your 401(k)into a vehicle that allows you to invest in gold and make more money to add to your retirement nest egg can be a relatively straightforward process, it’s best to hire an experienced, professional, financial advisor to help you. They can provide the insights and guidance you need to make the transition from a regular 401k to a gold 401k a simple, fast, safe and easy process. Finding a properly vetted, good fiduciary financial advisor legally bound to act with your best interest in mind can make achieving your financial and gold investment goals a breeze.

401(k) Basics

A 401(k) can be an excellent employee retirement savings plan. Many of them offer the advantage of having the employer make partial payments into the account or even match the contributions the employee makes in the plan 100%. Plus, 401(k)plans usually have fund managers handling them and enable plan enrollees to diversify their investments among the selection of mutual funds the plan offers. Workers can use 401(k) plans to take advantage of many major market opportunities. However, even though gold is one of the hottest and safest investments today, most 401(k) plans don’t let individuals invest in gold directly.

A Missed Opportunity

With the investment value of gold high and rising, investors can bolster their retirement income by shifting a portion of the money in their 401(k) investment portfolio to gold assets. This can ensure they don’t miss the opportunity to profit from the historic boom taking place in the gold industry. Gold, with its finite supply, offers an unmatched investment opportunity. While the stocks and bonds in the average worker’s 401(k) investment portfolio fluctuate and lose value, gold tends to hold its high value without the volatility of stocks and other paper assets. Not buying some gold now could be a missed opportunity you regret later.

1. Purchasing A Gold IRA

Purchasing a gold IRA is one of the safest, most lucrative investments you can make with some of the money from your 401(k). Since most governments have abandoned the gold standard for their currencies, money has been printed at unprecedented levels. Printing too much money debases the value of the currency and shrinks the value of your 401(k). Purchasing gold IRAs is a good way to shield the value of your retirement investment account from becoming more eroded each time the government decides to print some more money.

Gold 401k Accounts

Take Control Of Your Future

Investing in Gold IRAs lets you control of your financial future. The Federal Reserve or the federal government often comes up with ways to save the economy that require printing more money to solve economic malaise or other problems. This often leads to inflation and the dollar loses some of its value. So, while the amount of money in your 401(k) may grow, its value and buying power shrinks. However, the value of gold is constantly rising. Investing in a Gold IRA is the perfect hedge against inflation and can strengthen your retirement investment portfolio.

2. Mutual Funds That Invest In Gold

While your employer funded 401(k) plans may not allow you to purchase gold bullion and gold coins directly, most allow you to invest in mutual funds that invest in gold producing companies. Simply find an actively managed, value-oriented, mutual fund provider with funds primarily invested in gold mining companies that consistently generate a solid profit. There are low-cost gold focused mutual fund investment options that can help provide some financial security to your retirement account because gold has traditionally held its value or had it increase.

Gold Funds Growing In Popularity

Many savvy investors buy gold for wealth creation and as a hedge against inflation and economic instability. This has been a boon for mutual funds that have their money invested in gold mining, gold processing and gold producing companies. It’s also great news for people who have diverted some of the money in their 401(k) to gold-focused mutual funds. While people worldwide purchase gold for religious, cultural and ornamental purposes, the returns the gold-focused mutual funds pours into the retirement accounts of investors will continue to grow and they can retire flush with cash.

3. Use Exchange-Traded Funds (ETFs) To Invest In Gold

If your 401(k) plan comes with a brokerage option, this can give you the freedom to become involved in a variety of types of gold investments. One simple, low-cost, way to invest in gold through this type of 401(k) account is to invest in Exchange Traded Funds or ETFs. This provides the employee with access to a wide range of types of gold investments. ETFS enable investors to purchase shares in funds that hold gold bullion, or invest in stocks in companies working in the gold industry. The returns from these investments can cause your retirement investment account to grow rapidly.

stock market

More Gold Buying Options

ETFs also enable employees with 401(k) accounts that have the brokerage option to invest in individual gold industry firms stock. Investing in Gold ETFs through their 401(k) gives employees a wide range of benefits. They include diversification, minimum investment amounts and access to a wide range of gold securities. Gold ETFs are instruments that invest in gold bullion or are based on gold prices. Gold Mutual Funds are considered to be a Gold ETF variant. Many gold mutual funds invest in Gold ETFs. Employees with the right type of 401(k)can gain access to gold investment opportunities through Gold ETFs.

4. A Self-Directed IRA Rollover

Employees determined to take advantage of the great opportunities available to invest in gold, but have their money tied up in a 401(k) plan have another option. If their current 401(k) does not enable them to meet their investment goals, they can opt out of the 401(k) and roll the money over into a type of IRA called the self-directed investment retirement account. This enables employees to gain access to virtually any type of gold investment vehicle. That includes mutual funds, ETFs, stocks, commodity futures and options.

A 401(k) From A Previous Employer

Even people who are already retired who have a 401(k) plan account with their previous employer can roll the money over into an IRA. The rollover option can also be done for the 401(k) plan people have with their current employer. They can simply ask their employer for an in-service withdrawal. This allows an employee to withdraw the funds in their 401(k) account before they retire. The employee faces no tax penalty if within 60 days they re-invest the funds in an alternate 401(k) plan or an IRA. Once the money is in the self-directed investment retirement account they can invest it in gold stocks or in physical gold.

Tim Schmidt


Tim Schmidt is an Entrepreneur who has covered retirement investing since 2012. He started IRA Investing to share his expertise in using his Self-Directed IRA for alternative investments. His views on retirement investing have been highlighted in USA Today, Business Insider, Tech Times, and more. He invested with Goldco.