How to Make an IRA Investment in Gold | The Complete Guide

Investing in gold and other precious metals through Individual Retirement Accounts (IRA) is an appealing and financially secure way for investors to back up their retirement portfolio, diversify their investment holdings, and strengthen their savings.

Physical gold has been a safe haven for many during turbulent times due to its rarely fluctuating values. As a result, this steady form of investment can be a good backup against long-term inflation.  For this exact reason, I’m a huge advocate of the Gold IRA.

This is my favorite use of retirement funds, and if you haven’t heard of this, check out the top companies I personally vetted in my process of setting up a precious metals IRA myself.  

Or, if you want to go directly to the #1 choice (the company I used) – Click Here for a Free Investors Guide.

What Is a Gold IRA?

IRA Investment in Gold

Making an IRA investment in gold is a form of opening a self-directed IRA. Such accounts allow investors to diversify their retirement portfolios with a wide variety of unconventional assets. These include precious metals such as gold, silver, and palladium. 

On the other hand, self-directed IRAs can also hold other assets, such as real estate, stocks, and cryptocurrencies. 

Also Read:  How Does a Gold IRA Work?

How Much Gold Should an IRA Hold?

Although investing in gold and other precious metals can be a great hedge against inflation and fluctuating economies, you should never invest more than 10% in one form of asset. A properly-designed retirement portfolio should be diversified, with equal amounts of unconventional and traditional assets. 

Gold might be a strong contender when it comes to putting up a fight against turbulent times, but it’s still risky to invest all your funds into just precious metals. 

IRS Standards for Precious Metal Investments

Investors can now easily store gold and other precious metals in self-directed IRAs, but all of the assets must meet certain purity levels set by the Internal Revenue Service (IRS). 

  • Silver – 99.9% pure
  • Gold – 99.5% pure 
  • Palladium – 99.95% pure
  • Platinum – 99.95% pure 

Note that self-directed IRAs, at the moment, do not hold collectible coins, German Marks, British Sovereigns, and Swiss Francs. However, you can store Canadian Maple Leaf coins, PAMP Suisse bars, and Australian Koala bullions in such accounts. 

Looking to invest in gold with the lowest minimum investment?  Read my Red Rock Secured review.  They are my #1 company I’ve vetted for investing smaller amounts of money in gold and silver.

Opening a Gold IRA

Gold IRA Depository

Investing in a self-directed IRA is a great option for anyone who is looking to diversify their investments and capitalize on the benefits and commonality of a retirement account.

  • Select a Custodian 

The first step in opening a Gold IRA or precious metals IRA is to choose a custodian, such as a renowned bank and trust company approved by the Internal Revenue Service (IRS), to hold the assets.

It is important to do your research on a custody company to ensure it has a good reputation and track record. You can go through authorized third-party reviews, such as the Better Business Bureau, to learn more about the custodian.

  • Choose a Dealer 

Be mindful when selecting a dealer, and make sure to check their background before rolling over any funds. Investors can also have their approved IRA custodian directly transfer funds to the precious metals dealer for purchasing gold, platinum, and other assets.

It’s recommended to search for dealers belonging to renowned industries, such as the Industry Council for Tangible Assets (ICTA) or the American Numismatic Association (ANA).

If that seems too hard, ask the IRA custodian to recommend you trustworthy dealers, and then do your research on the background.

Two of the best can be seen here:  Goldco and Augusta Precious Metals Comparison

  • Purchase Products 

Most investors purchase U.S Mint issues bullion coins as their first choice of precious metals. You can also buy other collectibles, such as PAMP Suisse bars and Canadian Maple Leaf coins.

  • Select an IRS-approved Depository 

After completing all the steps above, you can finally move on to storing your purchased precious metals in an IRS-approved depository. The most common choice for most investors is the Delaware Depository for its unbreakable security and safety protocols.

Once that’s done, too, transfer the funds to your IRA custodian, and they can signal the dealer to roll over your purchased metals to the approved depository.

How to Withdraw from a Gold IRA | Rules to Follow

Investing in physical gold and storing them in a depository is the easy part. However, withdrawing directly from the IRA can be confusing and complex for many.

  1. Traditional Gold IRA 
  • All contributions to a gold IRA must be made with pre-tax dollars only.
  • The distributions will be taxed as ordinary income.
  • Invoking distributions before reaching the age of 59 ½ will result in a 10% penalty fee.
  • All investors must be subjected to taking the Required Minimum Distributions (RMDs) even after surpassing the age of 72.
  1. Gold Roth IRA 
  • All contributions need to be made with after-tax dollars only.
  • Distributions before reaching the age of 59 ½ will result in a 10% penalty fee.
  • Taxes are not imposed on any withdrawals.

Costs Associated with Investing in a Gold IRA

Gold IRA Costs

Knowing what fees you may be charged and what else may be needed can help you decide if investing in a Gold IRA is the right move for you and your retirement plan.

Understanding the fees and costs is an important part of being a savvy investor and will ensure you make the right decision

  • Storage Fees

These payments vary widely and are determined by the IRA custodian. Depending on the custodian, storage fees may be waived as part of an initial investment or as an ongoing payment.

Still, this is an important factor to consider, as these fees can potentially add up over time. Generally, all investors have to set aside 0.06% of the total asset value on a monthly basis.

  • Account Setup Fees

These are one-time payments that the custodian charges to set up a retirement account and can typically range from $50 to $250.

On the other hand, cash-out fees are associated with closing your gold IRA before reaching retirement age. These fees can be quite expensive and typically range from $50 to $300, depending on the custodian.

  • Seller’s Fee

This is a one-time payment for the purchase of physical gold for your gold IRA. It typically ranges from 1.5% to 3% of the gold’s purchase price.

The Average Time Taken to Open a Gold IRA

With gold prices soaring, investing in a gold IRA is becoming an increasingly attractive option for investors looking to diversify their portfolios. However, how long does it take to open a gold IRA, and what factors influence the overall time taken to open one?

Generally speaking, it takes about 10 to 15 minutes to open a gold IRA once you have gathered all the necessary documents. The speed at which the process is completed depends on the funding process and how quickly the custodian is able to answer.

On the other hand, rollovers from other accounts usually take 10 business days or more. The length of time taken depends on the number of assets being rolled over, which custodian is managing the account, and if the transfer is in-kind or not.

Sometimes, the custodian will require copies of documents from the existing plan provider and may also take days or weeks to accept or decline the transfer, which can also add to the overall time taken.

In most cases, the process shouldn’t take any longer than a single business day, but it is important to double-check the timelines and make sure everything is done in a timely manner. Investing is all about staying ahead of the curve and making sure your hard-earned money is safe for years to come.

The Main Types of IRAs

The two main types of IRAs available to investors are the traditional IRA and the Roth IRA. Generally, traditional IRAs allow you to save for retirement with pre-tax income, but you’ll incur taxes on the withdrawal.

On the other hand, Roth IRAs offer an attractive alternative, allowing you to pay taxes after contributing.

Also, traditional IRAs are one of the most popular retirement accounts and allow you to invest in a wide range of assets, including stocks, bonds, mutual funds, and exchange-traded funds (ETFs).

The contributions you make to your IRA are tax-deductible, meaning that you don’t pay taxes on the money until you make withdrawals.

Roth IRAs, on the other hand, are funded with after-tax income. This means your contributions will not be subject to a tax deduction during withdrawals.

If you want to invest in gold, however, you must open a self-directed IRA. Do your research and consult a financial professional to make sure that you’re making the best decision for yourself and your retirement.

Final Words

The true benefits of gold don’t only come from its performance but rather from its overall longevity as an asset.

History has proved time and time again that gold performs when other assets don’t, meaning that holding some exposure to this precious metal over a long enough period can provide an invaluable safeguard against inflation of other asset classes throughout retirement.

Of course, like any investment, there are some potential drawbacks associated with gold IRAs. The most significant of these is the relatively low degree of liquidity available when compared to some other investments.

Holding your gold in an IRA does not necessarily make it more liquid, meaning that upon retirement, owners of a gold IRA may experience delays in accessing their funds.

Ultimately, whether or not making an IRA investmentin gold is a wise choice mainly depends on the individual investor’s goals and risk-tolerance levels.

Those who are looking for long-term stability and growth may find that a gold IRA is the best option. On the other hand, investors who want short-term returns may want to look elsewhere.

Consider all of the potential pros and cons as you make your decision, and work with your advisor to ensure that your retirement portfolio is properly diversified and meets all of your unique financial goals.

Again, I personally invested with Goldco, and urge you to check them out.

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.