Gold IRA plan - Satori Traders

Gold IRA plan

So, you’ve decided to invest in a Gold IRA. That’s a great decision when you want to diversify your Portfolio or hedge against Inflation, economic uncertainty, and market volatility.

In this short article we’ll look at a simple four step Gold IRA plan for investing in Precious metals using your tax-advantaged retirement savings. The plan will show you how to find a reputable Gold IRA company and, more importantly, how to avoid the common scams that some Gold IRA companies employ.

If you’d like, you can also contact Augusta Precious Metals and obtain their Gold IRA Company Integrity Checklist. This informative guide is another resource you can use as you investigate different Gold IRA companies.

Four step Gold IRA plan

Doing something for the first time can be intimidating, and making an Investment in Precious metals is no different. This four step Gold IRA plan will give you the knowledge you need to successfully achieve your Investment objectives. 

1. 1Determine how much of your investable funds to allocate towards Gold
2. 2Choose a reputable Gold IRA company
3. 3Fund the Gold IRA account
4. 4Pick the products to hold in the account

Now that you know the four steps, let’s dig in and discover the details.

Step 1. How much Gold should you own?

Most of the advice you will find on the internet suggests that you allocate somewhere between 1% and 10% of your investable funds towards Gold.

Hardcore Gold bugs like Peter Schiff suggest that 10% to 20% is appropriate and there are a few individuals who recommend an allocation of 35% given the current economic conditions (Inflation, over-extended Stock markets, bank failures, rising interest rates, etc.).

Computer models typically use a Gold allocation of 3% to 10% and show that this allocation will increase your Portfolio’s cumulative return while also reducing overall volatility and the maximum drawdown you will experience.

Here at Satori Traders, we prefer to be conservative so we lean towards the 3% to 10% range even though our personal allocation to Gold is far higher. With a 3% to 10% allocation you can gain the upside benefits of Gold without jeopardizing your overall retirement Portfolio in the unlikely event that Gold declines significantly in value.

The bottom line is that only you can determine the allocation that is appropriate for your unique financial situation and tolerance for risk. However, based on the preponderance of available advice, that allocation is likely to be in the 3% to 10% range.

Step 2. How to find a reputable Gold IRA company

Finding a reputable Gold IRA company will take a little bit of work but the process is fairly simple:

1. 1Build a list of potential Gold IRA companies to invest with
2. 2Use the process of elimination to trim the list down to just a few companies
3. 3Contact the candidate companies
4. 4Pick the company you are most comfortable with

Let’s spend a little time expanding these steps since finding the right Gold IRA company is important.

Build a list

If you search the web for “best Gold IRA company” and similar phrases, you will find a handful of companies that are consistently recommended. Among them are:

• Augusta Precious Metals
• Goldco
• Birch Gold Group

This short list gives you a good starting point. If you spend some time searching the web you will be able to expand this list and add the companies that catch your attention.

Process of elimination

Now that you have some candidate Gold IRA companies it is time to take out the red pen and start crossing a few of them off the list.

Minimum requirements

 At Satori Traders we use these criteria as our minimum requirements for a Gold IRA company:

• 10 or more years in business
• AAA rating with the BBB
• Responsive to customer reviews and customer complaints on BBB

You can find all of this information on the BBB website by searching on the company’s name.

When you look at customer reviews and complaints on BBB, pay attention to how the Gold IRA company responds. Don’t eliminate a company just because someone files a complaint. What’s important is that the company makes an earnest attempt to resolve the complaint in a timely manner.

For a company to maintain its AAA rating with the BBB, it must respond to customer complaints and make a legitimate attempt to resolve the issue. That is why we recommend investing only with companies that have a AAA rating.

If you spend enough time reading customer complaints on BBB you will notice that the same complaints show up repeatedly. In Step 4 of this Gold IRA plan we will show you how to avoid making the mistakes that lead to these common complaints.

Minimum Investment amount

You will want to filter your list based on the amount of money you intend to invest. All of the Gold IRA companies have a minimum Investment amount so you don’t need to spend time researching any companies with a minimum that exceeds your intended allocation to Gold.

 This table shows the minimum Investment for each of the companies listed above.

Company	Minimum Investment	Contact
Augusta Precious Metals	$50,000
Goldco	$25,000
Birch Gold Group	$10,000

Customer education

The next criteria you can use for filtering your list is the emphasis that the Gold IRA company places on customer education. The easiest way to judge this factor is by visiting the company’s website and looking at the resources they offer.

At a minimum you should find information providing the basics of investing in a Gold IRA. Look for a Gold IRA guide or a free investor kit. Some companies only provide this material after you complete and submit their contact form.

Ideally, in addition to basic information about investing in a Gold IRA you will find a regularly updated library of videos and articles addressing current economic and market matters.

Augusta Precious Metals sets the Gold Standard for consumer education. On their website they provide an extensive video library covering both economic basics and current economic events. The company also addresses current market news with timely and in-depth articles.

In addition to these resources, Augusta provides two must-watch videos (“10 Gold IRA Dealer Lies”, and “15 Bad Reasons to Buy Gold and Silver”) along with a calculator that lets you explore how Inflation could affect your retirement lifestyle.

 Checkout the educational resources at Augusta Precious Metals and then compare them to any other Gold IRA company you are considering. You can also refer to Augusta’s Gold IRA Company Integrity Checklist as you implement this four-step Gold IRA plan.

Contact candidate companies

This is where the rubber meets the road, as the old saying goes.

 When you speak to a Gold IRA company representative, this is what you are looking for:

• Are they professional and courteous?
• Are they trying to pressure you into making a decision?
• Do they answer your questions in a straightforward and understandable way?

Let the representative know that you are comparing several companies and ask them how they are different from their peers.

You may get the brush-off at this point if the representative thinks you are ‘just shopping around.’ If that occurs, then cross the company off your list. A reputable company will be proud of itself and the representative will be happy to tell you why they are the best.

Ask the representative whether they recommend investing in Bullion bars and Coins, or special edition Coins. Pay particular attention to how they answer this question. As we will see in Step 4 of this Gold IRA plan, selling special edition Coins is the most common way that Gold IRA companies take advantage of unknowledgeable investors.

When you were looking at BBB reviews and complaints you may have come up with some questions or concerns. Now is the time to ask your questions and give the representative an opportunity to address your concerns.

 After you ask the representative your questions, let them know that you need some time to digest the information before making any decisions. If they become pushy or use fear tactics, cross the company off your list.

Pick the best company for you

At this point you will have developed a good sense for which company is best for you. It is also likely that you will feel more knowledgeable about Gold IRAs and the companies that provide them.

If it isn’t obvious which company you want to invest with, these tips may be helpful:

• Which company has the fewest customer complaints on BBB? (Augusta Precious Metals has zero complaints)
• Compare the companies that are still on your candidate list. Which company is the best based on the factors that matter the most to you?
• Think about the company representatives and how they treated you. Which of them would you be most comfortable doing business with?

You may realize that you still have some questions or concerns that you’d like to address before making a decision. There is certainly nothing wrong with that – that is why you are doing your due diligence.

And, after all, we are talking about your hard-earned money. You need to be comfortable with the decision you make.

Feel free to contact the company representatives again and let them respond to your remaining questions and concerns.

Based on the BBB reviews for Augusta Precious Metals, the company will spend as much time as needed to educate you and help you determine if a Gold IRA is appropriate for your unique circumstances and tolerance for risk.

Ideally, all of the Gold IRA companies will treat you in this manner. If they don’t, cross them off your list. There are lots of Gold IRA companies that you can invest with – don’t hesitate to use your red pen.

 If you haven’t contacted Augusta Precious Metals already, reach out to them and obtain a copy of their Gold IRA Company Integrity Checklist. Even if you choose another Gold IRA company to invest with, the Augusta checklist will help you make an informed decision.

Step 3. How to fund your Gold IRA account

You have three choices for funding your Gold IRA account:

1. 1Rollover from an existing Retirement account
2. 2Transfer from an existing Retirement account
3. 3Deposit new funds

Gold IRA rollover

In a Gold IRA rollover, you move funds from an existing Retirement account into your new Gold IRA account. The funds are wired from your current account Custodian to the Gold IRA Custodian so the funding process is quick and there is no risk of triggering any IRS rules that could result in taxes or penalties.

 There is no limit on the amount you can roll from one tax-advantaged account to another, but the IRS only allows one rollover per tax year.

Transfer

There is only one difference between a Gold IRA rollover and a transfer.

With a transfer you withdraw funds from your existing Retirement account, take possession of those funds, and then deposit that money into the Gold IRA account. In other words, you act as a middleman in the funding process.

The IRS allows you 60 days to complete the transfer process without assessing any taxes or penalties. After 60 days, any funds that have not been deposited into a tax-advantaged account will be treated as a taxable distribution and the IRS will assess applicable income taxes and early-withdrawal penalties.

 The only justification for choosing a transfer over a rollover is if you want to take some money out of your Retirement account (i.e., a taxable distribution) and use it for a purpose other than investing. Unless this is your objective, stick with the Gold IRA rollover and avoid triggering the 60-day IRS rule.

New funds

In this option you would take money out of your current earnings and deposit it in your Gold IRA account. When preparing your tax return for the current year, you would specify this money as an IRA contribution in your Form 1040 Adjustments to Income.

While it is possible to open a Gold IRA account by depositing new funds, you will run into a challenge finding a Gold IRA company whose minimum Investment level is at or below the maximum IRA contribution allowed by the IRS.

Most Gold IRA companies have a minimum Investment level of $10,000 or more while the maximum IRS-allowed IRA contribution is only $7,000 for 2024 ($8,000 if you are age 50 or older).

If you choose this option, do your due diligence on Fidelity Investments and determine if you are comfortable working the company. Fidelity offers Gold IRA accounts and their minimum Investment is only $2,500.

Step 4. Which products should you hold in your Gold IRA account?

After you fund your Gold IRA account you will be able to choose the specific products you want to invest in. There are several choices you will need to make.

Gold, Silver, Platinum, or Palladium?

The first choice you will make is to decide which of the Precious metals you will invest in: Gold, Silver, Platinum, or Palladium. You can hold any of these metals, or a combination of them, in your IRA.

Assuming that your primary objective is to diversify and protect your retirement Portfolio, put most of your funds into Gold. The other Precious metals are more speculative in nature and they don’t have Gold’s long track record as a store of value.

At Satori Traders we love Silver and believe it will outperform Gold on a percentage basis. With that said, we also acknowledge that Silver is far more volatile than Gold, which means it is a riskier Investment than Gold.

We encourage all investors to own some Silver but not to get carried away investing in the white metal. As a general rule, don’t put more than 40% of your funds into Silver.

 While Platinum and Palladium are certainly Precious metals, they just don’t compare to Gold and Silver as viable Investments. Without going into the details of why, we recommend that you stay away from these white metals.

Bars vs Coins

Whether you are looking at Gold or Silver, you will have multiple options to choose from. The choice between bars and Coins is really just personal preference.

 Keep in mind that we are talking about Precious metals that are going to be stored in your name in a Custodian’s vault. Whether you opt for bars or Coins, remember that you aren’t picking art objects to show your family and friends. Don’t get hung up on selecting products just because they are pretty.

Most metal for the least money

Here is the most important guideline to remember when you are investing in Precious metals:

“Always buy the most metal for the least amount of money”

If a one-ounce bar of Gold costs less than a one-ounce Coin, buy the bar.

If a one-ounce Gold Krugerrand costs less than a one-ounce Gold Eagle, buy the Krugerrand.

Keep in mind that Gold is Gold. It doesn’t matter whether the Gold is a proof Coin in a fancy box or a beat-up Krugerrand from the scratch-and-dent bin. Both of them have the same value, regardless of what any salesman tries to tell you.

Proof Coins and special edition Coins

Some unscrupulous Gold IRA companies will try to steer you towards investing in proof Coins and special edition Coins.

They will tell you that there is greater investor demand for these Coins so they will increase more in price. As part of this sales pitch, they will also try to convince you that these fancy Coins will be easier to sell when the time comes.

Recognize that these are just sales tactics, not the truth.

Go back to the guideline:

“Always buy the most metal for the least amount of money”

Here’s the truth: knowledgeable Precious metals investors have zero interest in paying a premium for proof Coins, special edition Coins, Coins in fancy boxes, Coins with certificates of authenticity, etc. If you invest in these fancy Coins, you are likely to find that there is limited interest from investors when you try to sell them.

If you read enough customer complaints in BBB you will realize that many of the complaints come from individuals who got duped by a Gold IRA salesperson. They invested in fancy Coins and then lost 30 or 40% of their Investment when it was time to sell.

Don’t let this happen to you!

Stay away from fancy Coins and remember the guideline:

“Always buy the most metal for the least amount of money”

Wrapping up

This article ended up being far longer than intended. Instead of 1500 words it is almost twice that amount.

While we would like to provide you with all the knowledge you need in just a few words, that simply isn’t possible when it comes to making a successful Precious metals Investment.

Because we care about your success we have provided this simple four-step Gold IRA plan and covered all of the details you need to know.

Based on our experience and research here at Satori Traders, we believe that Augusta Precious Metals is the best Gold IRA company by far. If you intend to invest $50,000 or more of your tax-advantaged savings into physical Gold and Silver, make sure that Augusta is one of the companies on your candidate list. If you contact Augusta they will provide you with a free copy of their Gold IRA Company Integrity Checklist.

About Satori Traders

Hi, my name is Bryan Post and I love the shiny stuff - Silver and Gold.

I've been investing in the Precious metals and mining stocks since 2002 when I realized that Gold is the only real money on the planet.

Here on SatoriTraders.com I share everything I've learned about the metals, Financials markets, trading, Technical analysis, and the numerous games that central banks play with fiat currencies.

https://satoritraders.com/precious-metals/gold/ira/plan/

Are Gold IRAs safe? - Satori Traders

Are Gold IRAs safe?

A Gold IRA is an intriguing financial instrument which offers Portfolio diversification, a hedge against economic uncertainty, and Wealth preservation over the long-term. Along with these important benefits, Gold IRAs provide the only way to purchase physical Precious metals using your tax-advantaged retirement savings. They are also one of the few ways you can safely move your hard-earned savings out of paper Investments and into tangible assets.

Moving your retirement savings from traditional Investments (Stocks, Bonds, and Mutual funds) to physical Gold is not a trivial thing to do. It is important that you do some research before making this move, and it is certainly understandable that you are asking the question, “Are Gold IRAs safe?”

The growing interest in alternative Investments for retirement

As the ravaging effects of Inflation take hold and the safety of traditional Investments becomes more uncertain, investors are turning to physical Gold and Gold IRAs as a way to offset financial risk and, perhaps, earn higher yields than are available with Stocks, Bonds and Mutual funds. This growing interest in alternative retirement Investments is also driven by the historic performance of Silver and Gold during the Inflation / stagflation that occurred during the 1970s.

Perhaps you are noticing that the economy of today shares several similarities with the economy of the 1970s. During that period deficit spending was out of control, interest rates were rising, the energy supply was at risk, and geopolitical tension between countries was elevated. These conditions led to dramatic price increases in both Gold and Silver, with the yellow metal rising from $40 an ounce in 1971 to $850 an ounce in 1981 and Silver increasing from $1.55 an ounce to $50 an ounce.

There are no guarantees in the world of financial Investments, but many people believe that Precious metals will repeat their performance of the 1970s while also providing safety for their Retirement accounts. If you want to protect and preserve your Wealth while minimizing the volatility of your retirement Portfolio, a Gold IRA is certainly a compelling Investment option. To find out if a Gold IRA is appropriate for your unique circumstances, contact Augusta Precious Metals and request their comprehensive investor education package which includes their Gold IRA Company Integrity Checklist.

The case for Gold IRAs

Historical stability and value of Gold

Before we explore Gold IRAs in depth, let’s focus on physical Gold itself since that is the primary asset you will hold in your Gold IRA account.

There are several key points to understand about the history of Gold and its role as a store of value:

1. Humans have treasured the beauty of physical Gold for thousands of years. For at least 6,500 years they have used the yellow metal to adorn themselves and to create objects of art that they could appreciate and share with others. Based on this long history, it would not be unreasonable to say that human beings have an affinity for Gold that forms a part of their very makeup.

2. Gold has also been used as a circulating currency and store of Wealth for at least two thousand years. Gold currencies were first introduced in Lydia (modern day Turkey) and China around 2,700 years ago and then became widespread as the Roman culture made standardized coinage popular throughout the World. During these times Gold was widely recognized as a store of value and stable mechanism of exchange.

3. It is only in the last 200 years or so that Gold’s role as a store of value and means of exchange has come under question. This period of time just happens to coincide with the rise of central banks and their introduction of fiat currencies. While the central banks have held onto physical Gold as a reserve asset, they have promoted the idea that Gold is a barbarous relic with no role in modern society. Obviously, if that were true, they would divest themselves of their Gold holdings in favor of some other asset that could act as a better store of value.

As you continue to explore the role that physical Gold can play in your retirement Portfolio, keep the points above in mind. It is clear that Gold has a long history of being valuable to human beings and it is reasonable to assume that this role will continue into the future (regardless of what central bankers would like you to believe).

Gold as a hedge against economic uncertainty

Gold acts as a powerful hedge against economic uncertainties because the price of Gold tends to move in the opposite direction of traditional assets like Stocks, Bonds, and Mutual funds. In other words, when paper assets are losing value physical Gold tends to gain value. This occurs because investors seek the safety of tangible assets like physical Gold when they become nervous about rising geopolitical tensions and see their paper Wealth being evaporated in a deteriorating economy.

Gold also gains value as Inflation erodes the Purchasing power of fiat currencies like the US Dollar and Euro. There are two strong proofs of this tendency:

1. A single ounce of Gold in the 1920s (with a government-mandated price of $20 per ounce) was enough to purchase a bespoke (i.e., high-end) man’s suit. Today, an entry-level Armani suit costs $1700 to $2000 and the price of Gold is about $2000. That means Gold has retained its value for more than 100 years despite the ravages of Inflation.

2. Similarly, a Ford model T in 1920 cost $500 which was the equivalent of 25 ounces of Gold. Today, those same 25 ounces of Gold are worth approximately $50,000 which is more than enough to buy a nice sedan, SUV, or even an entry-level luxury car. Again, Gold has held its value (Purchasing power) for more than 100 years.

Up to this point we have been talking about physical Gold in a generic sense while emphasizing the safety it can provide for your hard-earned savings. Let’s return now to what we briefly mentioned at the start of this article: Gold IRAs are the only way for you to protect your tax-advantaged savings with physical Gold. If you recognize the value of physical Gold, and want to protect your retirement savings by diversifying into the yellow metal, a Gold IRA is the only tax-advantaged Investment vehicle that allows you to do that. Continue reading to learn more about Gold IRAs or, to get started now, reach out to Augusta Precious Metals and they will provide you with the Gold IRA Company Integrity Checklist along with an informative investors kit.

Diversification for a well-rounded retirement Portfolio

Financial advisors talk about the importance of diversifying your Investment portfolio but, upon close examination, it becomes obvious that most of their recommendations involve paper assets. Furthermore, they typically suggest that you buy the Stocks, Bonds, and Mutual funds being offered by their firms because they earn a commission when you buy these products.

To receive unbiased Investment advice, you must hire an Investment advisor who has a fiduciary duty to you. This means they are legally required to put your interests in front of their own interests and the interests of the firm they represent.

When you find an unbiased advisor, they will explain how true Portfolio diversification involves spreading your hard-earned savings into a mix of paper assets (Stocks, Bonds, and Mutual funds) and tangible assets like physical Precious metals and Real Estate.

There are several reasons why physical Gold is the ideal asset for achieving effective Portfolio diversification:

1. It only takes a small amount of Gold to offset the financial risks that are inherent in traditional (i.e., paper) Investments and in Real Estate. Investing just 10% of your overall retirement savings into Gold is enough to insure the rest of your Portfolio.

2. Physical Gold has zero counter-party risk. When you own physical Gold you have an asset with intrinsic value and that value can’t be diminished by the actions of a third-party.

3. Computer models show that the volatility (ups and downs) of an Investment Portfolio can be substantially reduced when 3 to 10% of the Portfolio is held in Gold.

4. In comparison to successful Real Estate investing, it only takes a little bit of specialized knowledge to successfully invest in physical Precious metals.

Dissecting myths about the safety of Gold IRAs

There are some common myths about the safety of investing in physical Gold and Gold IRAs:

Myth	Reality
Gold is volatile and inherently risky	Over short time periods Gold can be volatile just like all other Investment vehicles. For long-term Investments and retirement savings, however, Gold acts as a stable store of value while providing a hedge against economic uncertainty and the ravages of Inflation.
Gold is subject to confiscation by the government	This myth is fueled by the government’s actions in 1933 when American citizens were ordered to give up their Gold. During that time, however, the country was on a Gold Standard (i.e., Gold was money) so a case could be made that recalling the citizen’s Gold was required to strengthen the country’s economy. Today, we have a fiat monetary system (i.e., money by decree) and central banks are telling us that Gold is a barbarous relic. Confiscating Gold in today’s monetary environment would have no justification.
Gold has no intrinsic value	6,500 years of human history shows that this myth is not only unfounded, it is laughable.
Gold is illiquid and difficult to sell	In contrast to this myth, Gold is actually the most liquid asset on the planet. Just take your physical metal to any Gold dealer, your local Coin shop, or your local pawn store and they will gladly exchange your Gold for fiat currency.
Gold is prone to scams and fraud	All financial Investments involve risk – this is an inescapable fact of life. To minimize risk, it is critical to work with reputable Gold dealers who can ensure the safety and legitimacy of the physical Gold you purchase.
Gold Coins are overpriced relative to the price of Gold	There is an element of truth here but, to be accurate, we have to say that only some Gold Coins are overpriced. If you limit your purchases to one-ounce Gold Bullion Coins only, you can avoid overpaying for your Investment in physical Gold. Stay away from proof Coins, limited edition Coins, special edition Coins, Coins in fancy boxes, Coins with certificates of authenticity, and fractional-ounce Coins.

Are Gold IRAs a safe Investment?

We return now to the key question, “Are Gold IRAs safe?”

In this brief article we have focused on how physical Gold can safeguard retirement savings against economic turmoil. We also touched on how Gold acts as a safe-haven asset in difficult economic times like the 1970s and pointed out that we are currently experiencing economic conditions which are very similar to the 1970s. What we haven’t addressed yet is the safety of the Gold IRA vehicle itself, including how and where your physical Gold will be stored – let’s do that now.

Are Gold IRAs approved by the IRS?

IRA accounts were established in 1974 by the Employee Retirement Income Security Act (ERISA). In 1997 the Taxpayer Relief Act (TRA) added Gold and Silver to the asset categories that could be held in IRA accounts. Through an expansion of the TRA in 1998, Platinum and Palladium were added to the list of IRA-approved assets.  The enactment of these pieces of legislation tells us that Gold IRAs are approved by the IRS and that the IRS considers these Investment vehicles to be safe, or at least as safe as any other tax-advantaged Retirement account.

Where will the Precious metals in your Gold IRA be stored?

One of the IRS regulations for a Gold IRA is that the Precious metals in the account are held by a third-party Custodian who is registered with the Financial Regulatory Authority (FINRA). This Custodian will provide secure storage for your metals along with insurance coverage for the full value of your holdings.

While the idea of storing your Gold with a third-party Custodian may be a little disconcerting at first, understand that this arrangement is no different than you currently have for the Stocks, Bonds, and Mutual funds your existing Retirement accounts. In both cases, a registered Custodian holds your Investments in your name and ensures that your assets are securely stored. The only difference is whether the assets are paper (Stocks, Bonds, and Mutual funds) or physical Precious metals.

The bottom-line is that Gold IRA accounts are safe Investments. Gold IRA Retirement accounts were established through legislation more than 25 years ago and the Precious metals in the accounts are stored by registered Custodians with secure, insured vaulting facilities.

Executive summary

Here’s a quick recap of the ideas we have covered in this article:

• For thousands of years humans have valued Gold for its beauty, its role as a store of value, and its usefulness as a medium of exchange
• Gold acts as a hedge against Inflation
• The price of Gold tends to rise in economically challenging times like the 1970s
• Gold provides diversification for an Investment Portfolio
• The common myths about investing in physical Gold are just that – myths
• Gold IRA accounts were established through legislation and they are approved by the IRS
• Precious metals held in a Gold IRA account are securely stored and insured by a registered Custodian

You can start a Gold IRA today by contacting Augusta Precious Metals and requesting their Gold IRA Company Integrity Checklist. They will provide you with free information and they will work with you to determine if a Gold IRA is appropriate for your unique financial situation and retirement objectives.

 As always, performing due diligence and obtaining expert advice are important when you are establishing or making changes to your retirement strategy. At Satori Traders we do our best to help you in this process by providing free information about Precious metals in general and Gold IRAs in particular. If you have questions about either topic, please feel free to contact us and we will answer your questions to the best of our ability.

About Satori Traders

Hi, my name is Bryan Post and I love the shiny stuff - Silver and Gold.

I've been investing in the Precious metals and mining stocks since 2002 when I realized that Gold is the only real money on the planet.

Here on SatoriTraders.com I share everything I've learned about the metals, Financials markets, trading, Technical analysis, and the numerous games that central banks play with fiat currencies.

https://satoritraders.com/precious-metals/gold/ira/safe/

Silver worth more than Gold? - Satori Traders

Will Silver Ever Be Worth More Than Gold?

There’s no doubt that Precious metals make a great hedge in turbulent times. Still, exactly which Precious metal is better remains a subject of debate.

In general, Silver is more useful in industrial applications, which buoys its demand. But Gold has been more expensive than Silver for several centuries now – and the price gap continues to widen.

Because of this, many investors now wonder if Silver is due for a revolution that could see it match – or even surpass – Gold in value and popularity. So, will Silver ever be worth more than Gold?Let’s find out.

The Gold-Silver Ratio

Many experts and investors rely on the Gold-Silver ratio to provide insights into these two metals’ worth. Essentially, this metric compares the price of one ounce of Gold to the price of an ounce of Silver. The higher the ratio, the more valuable Gold is by comparison.

The Gold-Silver ratio remained steady – around 15:1 – from at least 1687 through the late 1800s. Then, in the 1900s, the price of Gold skyrocketed and left Silver in the dust.

Over the last 120 years, the Gold-Silver ratio has fluctuated between 18 and 100. (In other words, for every ounce of Silver you bought, you could pay up to one hundred times more for the same amount of Gold.)

The reasons for this are complex – differences in supply and demand, industrial usage, and Investment popularity likely all contributed. When the pandemic hit, a modern “Gold rush” saw investors flee from more turbulent Stocks into “realer” assets like Precious metals.

That rush, alongside multiple mine closures, saw the Gold-Silver ratio fluctuate wildly. (In 2022 alone, it spiked from 65 to 95 in a matter of months.) And volatility aside, such a stubbornly high ratio highlights just how far Silver would have to climb to outshine Gold. 

Factors that Drive Silver’s Price

To understand the Silver metal’s chances of eclipsing Gold, it’s important to examine its price pressures.

Fiat Currency and Economic Movements

The strength of the U.S. Dollar and the Federal Reserve’s ongoing war against high Inflation continuously impact Precious metal prices. As Silver is more closely correlated to the markets than Gold, it’s far more susceptible to economic hiccups. (Often in complicated ways.)

Consider that higher interest rates often bleed into people’s bank accounts. When that happens, fiat currency earns more money than Precious metals that don’t pay interest or dividends. If demand drops as a result, the value of Silver may decline.

Other economic pressures may impact Silver, too. For example, when industrial demand declines, Silver falls out of fashion. In some instances, that may push its price downward as supply outstrips demand.

But that may not always be the case. When the economy falters, many investors move from “paper” assets like Stocks and Bonds to something more tangible. (Think Gold, Silver, and even commodities.) If enough investors replace industrial demand, Silver’s price may soar in spite of slackening commercial demand. 

Industrial Demand vs. the Silver Deficit

Silver isn’t just used to store monetary value; it’s also a common component in many industrial products. As a conductor, it became particularly in-demand during the 2021 tech boom and work-from-home surge. As a result, consumption soared 9% to over 508 million ounces.

But the tech boom was a blip in a larger pattern. Overall, industrial demand for Silver has climbed since 2012, buoyed by increasing need for Silver in: 

• Consumer electronics
• 5G infrastructure
• Solar panels and the “green” economy
• Investment Portfolios (particularly Coins and bars)

At the same time, pandemic closures forced several mines to slow or shutter operations between 2020 and 2021. As a result, the Silver market experienced its first supply deficit since 2015. While mines returned to their pre-Covid output in 2022, the gap remains. As a result, the interplay between supply and demand will be particularly significant for years to come. 

Stock Market Instability

The stock market is a notoriously volatile (read: unstable) financial entity. Sure, it’s easy to strike it rich if you make the right call. But it’s just as easy – and perhaps even more likely, depending on your strategy – to lose everything.

This volatility is often noncorrelated or reversely correlated with Silver prices. In other words, when the Stock market crashes, Silver may remain relatively steady or even soar. And when the Stock market rises, Silver may dip slightly or not at all.

Price Volatility

So far, human civilizations have discovered far more Silver than Gold, which should mean that Silver is more liquid. But thanks to their enormous price differences, Gold is actually more liquid and more valuable. While Gold often shuffles around, its price tends to move slower and stay higher for longer, making it the safer Investment.

Conversely, Silver prices tend to move faster and further (by comparison) than Gold. This reputation often lends itself to speculative investing, which contributes to rapid price movements. 

Geopolitical Uncertainty

A key price driver in all financial markets is geopolitical uncertainty. Over the last decade, there’s been plenty to go around. From tension with China and North Korea to Covid-19 to Russia’s invasion of Ukraine, Precious metals have bounced around a lot.

When geopolitical situations become tense, investors flock to Precious metals to hedge against volatility and shore up lasting value. As they relax, investors may sell out for paper Investments until the worst comes to pass again. 

Will Silver Ever Be Worth More Than Gold?

As of March 2023, one ounce of Gold costs over $1,900, while an ounce of Silver runs around $22.50. That means Silver prices would have to soar 86 times to match – let alone surpass – Gold’s price supremacy.

So, could it happen?

Unfortunately (or fortunately, depending on your view), the answer is…probably not. Below, we’ll look at a few factors that some think will lead to Silver’s dominance – and others think will keep Gold in the lead. 

An Unusually High Stock-to-Flow Ratio

One unusual fact about Gold and Silver is that they both have outsize stock-to-flow ratios. An asset’s stock-to-flow ratio describes how much is available versus how much can be produced. (Stock is the existing supply; flow represents the annual production.) Together, these numbers paint a picture of an asset’s relative abundance.

Throughout history, around 244,000 tonnes of Gold has been discovered, with around 209,000 of those tonnes actually mined. In 2022, worldwide Gold production stood just over 3,000 tonnes. Divide the stock by the flow (209,000/3,000), and we get a stock-to-flow ratio of just under 70. (As a side note, if we use the discovered value, the ratio climbs over 81.)

In other words, Gold is pretty damn scarce.

By contrast, over 1.74 million tonnes of Silver has been discovered to date, with global production spitting out 26,000 tonnes in 2022. Divide our stock by our flow (1,740,000/26,000), and we get a ratio of just under 67. That’s not far off from Gold’s near-70 ratio.

Now, of course these ratios fluctuate. But what these numbers sitting so close together tells us is that both Gold and Silver are in relatively high demand – and relatively scarce. As a result, it’s reasonable to presume that their prices will rise over time.

Unfortunately, given that Silver is far more abundant, it’s unlikely to eclipse Gold entirely. 

Silver’s Growing Industrial Demand

Much of the value and volatility of Gold and Silver is linked to their industrial Portfolio. (Or in Gold’s case, the relative lack thereof.)

Roughly 50-60% of all Silver is allocated to commercial applications, especially electronics and the green economy.

By contrast, just 10-15% of humanity’s Gold stores are used for industry. The rest is made into jewelry or Bullion.

Thanks to Silver’s lower price and wider list of use cases, demand for industrial Silver continues to rise. Industrial demand alone soared from 445.2 million ounces in 2012 to 539.6 million ounces in 2022. Overall demand grew, too, from 978.8 million ounces to 1,101.8 million ounces.

Despite soaring demand, it’s important to consider that Silver is more readily available than Gold, too. That’s likely an outsize contributor to the fact that Gold has averaged over $1,800 an ounce in 2023 – while Silver hasn’t yet breached $25. 

Soaring Institutional Demand

In recent years, Silver’s popularity has soared among investors big and small. A primary culprit has been the pandemic, which saw many risk-averse investors move into more tangible assets to protect their Wealth against inevitable collapses in the Stock and Crypto markets.

However, as Stock performance has ticked back upward, some investors have moved out of Silver and back into more traditional assets.

Though institutional demand (particularly for bars and Coins) has risen overall, the stagnation of other demand has dragged the price of Silver down with it. Between April 2020 and March 2023, the value of Silver dropped from a pandemic high of over $33 to just over $22. 

Was Silver Worth More Than Gold in the Past?

Some investors have pointed to historical literature that suggests Silver was at one time equal to, if not more expensive than, Gold in the past.

For instance, in 1919, William Jennings Bryan wrote that, “The morning papers announce that the Bullion in a Silver Dollar is now worth five cents more than the Bullion in a Gold Dollar.”

And in January 1920, the Silver the World Sensation (a mining newspaper editorial) announced that, “For the first time in history, Silver Coin, of the leading nations of Europe, sold at a higher price than Gold Coin. This of course does not mean that Silver is more valuable than Gold, merely a Silver Dollar or Shilling is worth more than a Gold Dollar or Shilling.”

However, such fluctuations are often more complex than the spot price of Silver surpassing Gold. Just because Silver Coins grow more valuable than Gold Coins doesn’t mean the metals themselves have swapped places on the value scale. (If anything, these examples highlight the importance of investing in Precious metals to guard against currency fluctuations.)

And if you need more proof, the Gold-Silver ratio shows that the price of Silver has never come close to parity with Gold.

Silver’s Future Value: Quick FAQs

Will Silver Be Valuable in the Future?

Chances are, yes! While the value of Silver is constantly in flux, growing demand has kept its value over $15 since the 2009 crash. While that’s not as high as Gold’s recent $1,800-plus streak, it suggests that Silver is remarkably resilient. 

What Will Silver Be Worth in 10 Years?

It’s difficult to predict the value of anything that far out – especially something like Silver, which has seen major fluctuations in recent years. (Consider that the price of Silver reached a high over $50 per ounce in 2011…and yet, hasn’t breached $25 in 2023.)

But some analysts have issued shorter-term Silver valuations that may be useful.

For instance, the World Bank sees Silver prices averaging around $21 through 2023. Less mainstream analysts predict that Silver will reach as much as $92 per ounce before the end of 2027.

Of course, that presumes our current, gradual uptrend will continue for several years. If the Silver market crashes due to unexpected economic or geopolitical interference, prices may fall instead. 

Will Silver Hit $100 an Ounce?

Silver has never hit $100 per ounce in the United States – yet. However, Gov Capital sees potential for Silver to breach $90 per ounce by 2027. And CEO of First Majestic Silver Keith Neumeyer said in an August 2022 interview that he sees Silver topping $130 an ounce in the future. (Of course, there are no guarantees – but wouldn’t it be nice!) 

Will Silver Ever Lose its Value?

It’s highly probable that Silver will see price volatility in the future. But given its incredible industrial uses, it’s unlikely it will lose all of its value. A more likely scenario is that Silver will dip and recover in blips while continuing to edge higher. 

So, Will Silver Ever Be Worth More Than Gold?

Unfortunately, it’s highly unlikely that Silver will ever be worth more than Gold. (At least in the near future.)

However, that doesn’t mean Silver is a bad Investment overall; high industrial and Investment demand are likely to buoy prices for years to come. By tempering your expectations about its future performance, you can make it an essential part of your long-term financial strategy. 

About Satori Traders

Hi, my name is Bryan Post and I love the shiny stuff - Silver and Gold.

I've been investing in the Precious metals and mining stocks since 2002 when I realized that Gold is the only real money on the planet.

Here on Satori Traders I share everything I've learned about the metals, Financials markets, trading, Technical analysis, and the numerous games that central banks play with fiat currencies.

https://satoritraders.com/precious-metals/silver/worth-more/

Gold IRA tax rules - Satori Traders

How is Gold taxed in an IRA?

As an investor, seeking financial security while lowering your lifetime tax burden is the name of the game. Nowhere is that more important than in your retirement Portfolio – which is why many investors use Individual Retirement Accounts (IRAs) to minimize their tax bill.

But what if you want to invest in an asset like Gold that isn’t permitted in a regular IRA?

That is where self-directed IRAs come into play.

Satori Traders has evaluated the self-directed IRA companies and rated them for their focus on consumer education, BBB rating, customer reviews, and required minimum Investment. Augusta Precious Metals is our top pick for investors with $50,000 or more. Goldco leads the pack for Investments of $25,000 to $50,000 and Birch Gold is best if you are investing less than $25,000.

What is a Gold IRA?

Gold IRAs, also referred to as Precious metal IRAs, are a specialized type of self-directed IRA (SDIRA).

SDIRAs let you use your tax-advantaged retirement savings to purchase and hold a wide range of assets, including:

• Physical Precious metals like Gold and Silver
• Stocks, Bonds, and Mutual funds
• Derivatives like futures and options contracts
• Commodities such as beef, Oil, and Copper
• Cryptocurrencies
• Real Estate

Congress created this Investment vehicle in the 1990s to allow investors greater control of their retirement plans.

SDIRAs share many similarities with regular IRAs. The tax benefits are the same (more on that below) but SDIRAs feature substantial differences, too.

To start with, SDIRAs hand the reins to you – remember, this is a self-directed IRA. You decide which assets you will hold in your SDIRA and you determine when those assets will be bought or sold.

This increased flexibility makes SDIRAs invaluable for securing your financial future by taking advantage of unique opportunities and assets like Gold and Silver.

Before we focus on Gold IRA taxes let’s clarify the IRS rules that will affect your tax-advantaged Investment in physical Precious metals.

You Must Use an Approved Custodian

To open an SDIRA that can hold physical Precious metals, you’ll have to work with a Gold IRA company or Custodian that specializes in administering these unique accounts. The company is responsible for:

• Coordinating with an IRS-approved Custodian (if they aren’t a Custodian themselves)
• Making Investments on your behalf to prevent self-dealing (which is prohibited by the IRS)
• Arranging for proper storage of physical assets
• Performing administrative functions to stay in compliance with IRS regulations

Depending on the Gold IRA company, they may let you choose your own Custodian or choose one for you.

You aren't allowed to hold your physical assets yourself

Unfortunately, the IRS doesn’t allow you to handle or store the physical assets in your Gold IRA. After purchasing your Precious metals, the Custodian will send them to an IRS-approved Depository. The Depository will ensure that your metals are properly stored and insured on your behalf. Whether you can choose your Depository or not depends on which Gold IRA company you choose.

Asset type, purity, and sourcing standards

While Gold IRAs allow you to hold physical Precious metals, there are several limitations that you have to follow.

For starters, you can only hold four physical metals: Gold, Silver, Platinum, and Palladium. Each metal must be in either Coin or bar form and meet specific purity and size standards. For instance, Gold must be at least 99.5% pure, while Silver must be 99.9% pure or higher (an exception is made for American Gold Eagle Coins which are only 91.67% pure).

You are also prohibited from purchasing any assets that are considered “collectibles”, jewelry, or artwork, or any Coins that have been circulated (i.e., Numismatic Coins). Your Gold IRA company and Custodian will ensure that these requirements are met.

Funding restrictions and contribution limits

Even though you will hold Precious metals in your Gold IRA, you aren’t allowed to contribute any metals that you already own. SDIRAs require that you contribute cash to your account, then use the contributed funds to make asset purchases within the account.

Like regular IRAs, SDIRAs have an annual contribution limit of just $6,500 in 2023 ($7,500 if you are over 50). These low contribution limits restrict the amount of Precious metals you can purchase in any given year.

One alternative to this funding restriction is to rollover assets from another Retirement account (such as a regular IRA, eligible 401(k), 457, or TSP) into the Gold IRA. The IRS allows you to perform one rollover transaction during each tax year without paying any taxes or penalties.

How is Gold taxed outside an IRA?

Now that we’ve covered the basic rules, we can dive into the specifics of Gold IRA taxes. But first, let’s look at how Precious metals are taxed outside an IRA as a point of reference.

Outside designated Retirement accounts, the IRS classifies Gold, Silver, and other Precious metals as “collectibles” for tax purposes. Effectively, that means you’ll receive the same tax treatment as you would for investing in paintings or vintage clocks.

Capital gains on collectible assets are automatically taxed at a 28% rate regardless of which tax bracket you are in.

 This high tax rate is significant for Precious metals investors – which is why Gold IRAs make such an attractive alternative for long-term investors.

Traditional Gold IRA tax rules

In IRA terminology the term “traditional” is used to describe a tax-deferred account where you invest your pre-tax income and then pay taxes when you withdraw money from the account.

Generally, traditional Gold IRAs are ideal if you expect to be in a lower tax bracket in retirement. By deferring your income and capital gains taxes until later in life, you can lower your overall tax obligation.

Capital gains within a traditional Gold IRA are taxed as regular income based on your tax bracket at the time you take a distribution. For most investors this tax rate will be lower than the 28% rate for collectibles.

Roth Gold IRA tax rules

Roth Gold IRAs, like their regular Roth IRA cousins, allow you to invest after-tax dollars in a tax-exempt Investment vehicle. While that means you will pay income taxes now, a Roth Gold IRA confers huge benefits later.

When you start taking eligible withdrawals from your Roth Gold IRA, you won’t have to pay any taxes – including on your capital gains.

Typically, Roth Gold IRAs are better if you expect to be in a higher tax bracket in retirement. By frontloading your tax bill now, you can lower your overall tax obligation on earned income and capital gains.

Early withdrawal penalties and taxes

It’s important to understand that Gold IRAs, like other tax-advantaged Retirement accounts, don’t allow penalty-free withdrawals unless you satisfy IRS requirements.

 With a Roth IRA, you must meet two criteria to make a penalty-free withdrawal:

• Your account must have been open for at least five years (even if you are over 65), and
• You must be at least age 59.5

Traditional IRAs don’t require your account to be open for any length of time but they still carry the age 59.5 rule.

If you withdraw cash or physical metal without meeting these IRS criteria you will be assessed a 10% early withdrawal penalty.

Early withdrawals from a traditional Gold IRA will be treated as regular income at your current tax bracket and you will pay income taxes on the distributed funds. Capital gains will also be treated and taxed as regular income.

Early withdrawals from a Roth Gold IRA are tax-exempt up to the amount you contributed. Capital gains on the account, if they are withdrawn, will be treated and taxed as regular income at your current tax rate.

There are exceptions to the 10% early withdrawal penalty. For example, the penalty is waived if you make a hardship withdrawal or use the funds for eligible expenses like a first-time home purchase or higher education costs.

Required minimum distribution taxes and penalties

The IRS requires that anyone with a traditional Gold IRA starts taking minimum required distributions (RMDs) between ages 70.5 and 73, depending on their birth year. RMDs are the minimum amount you must withdraw so the IRS can start recouping its deferred tax income.

It’s important to keep an eye on your required distribution amounts. Failure to take withdrawals will result in a 50% excise tax on the required amount you did not withdraw during the tax year.

Roth IRAs do not carry RMD requirements.

Bequests

If your Gold IRA still contains assets when you pass away, your beneficiaries will have to carry your remaining tax burden. Most beneficiaries have at least five years to withdraw all the IRA funds under current rules, though that may change based on their age and relationship to the deceased.

Generally, beneficiaries do not have to pay taxes on any inherited Gold IRA assets. They may owe income taxes, however, if they make withdrawals from an inherited Roth Gold IRA before the account is five years old.

 Note that the IRS waives the 10% early withdrawal penalty for beneficiaries, even if the original owner dies before age 59.5.

Gold IRA tax rules and your long-term plan

Understanding the Gold IRA tax rules allows you to make informed decisions that impact your current and future tax bills. With this knowledge you’ll be better equipped to make progress toward your retirement goals and build long-term financial security.

If you’re ready to take the next step with your Precious metal IRA, contact one of the companies that offer Gold IRA accounts. They will provide you with an investor kit and answer any questions you have. 

At Satori Traders we have researched the Gold IRA companies and identified the top three. If you have $50,000 or more to invest, contact Augusta Precious Metals. For Investments of $25,000 to $50,000, Goldco is your best option. If you are investing less than $25,000 then get in touch with Birch Gold.

About Satori Traders

Hi, my name is Bryan Post and I love the shiny stuff - Silver and Gold.

I've been investing in the Precious metals and mining stocks since 2002 when I realized that Gold is the only real money on the planet.

Here on Satori Traders I share everything I've learned about the metals, Financials markets, trading, Technical analysis, and the numerous games that central banks play with fiat currencies.

https://satoritraders.com/precious-metals/gold/ira/tax-rules/

Types of Gold IRA - Satori Traders

Roth Gold IRA, Traditional Gold IRA,

or SEP Gold IRA?

There are three types of Gold IRA accounts: traditional, Roth, and SEP. All of these account types allow investors to protect their tax-advantaged retirement savings with physical Precious metals.

The most common account type is the traditional Gold IRA which is funded with tax-deferred earned income. Today’s earned income is deposited into the IRA and the contributed amount is deducted from taxable income in the current tax year. When it is time to take withdrawals, taxes must be paid on both the contributed money and any capital gains. This account type is recommended for investors who plan to be in a lower tax bracket during retirement.

Roth IRAs are funded with after-tax earned income but the account is tax-exempt so you won’t have to pay taxes on withdrawals or capital gains. That means you will pay income taxes on your contributions for the current tax year but you won’t pay taxes on withdrawals or capital gains. If you believe you will be in a higher tax bracket during retirement this type of Gold IRA account may be ideal.

SEP Gold IRA accounts are a specialized form of traditional IRAs that are only available to employers and self-employed individuals. The key benefit of a SEP IRA account is the significantly increased contribution limit. Investors in traditional and Roth IRA accounts are limited to annual contributions of $6,500 in 2023 ($7,500 if you’re over age 50) while a SEP IRA account allows contributions of up to $66,000 per year (as of 2023). SEP IRAs follow the same tax rules as a traditional IRA account.

Regardless of the specific type of Gold IRA account, most Gold IRA investors are trying to protect their existing tax-advantaged savings. Instead of focusing on annual contributions they are more interested in converting their existing Retirement accounts into a Gold IRA account where they can purchase and hold physical Silver and Gold.

In this article we are going to focus on the ‘how to’ of moving money from an eligible 401(k), IRA, 403(b), 457, TSP, Annuity, or Pension into one of the three types of Gold IRA accounts. The good news is that a Gold IRA rollover allows you to perform this move without paying any taxes or penalties.

If you are ready to start your Precious metals retirement Portfolio now, Satori Traders has evaluated the Gold IRA companies and rated them for their focus on consumer education, BBB rating, customer reviews, and required minimum Investment. Augusta Precious Metals is our top pick for investors with $50,000 or more. Goldco leads the pack for Investments of $25,000 to $50,000 and Birch Gold is best if you are investing less than $25,000.

What is a Gold IRA Rollover?

Investing in a Gold IRA lets you attain the best of both worlds:

• You get to save for retirement using tax-deferred or tax-exempt money
• You get to hold your hard-earned savings in physical Precious metals.

A Gold IRA rollover lets you obtain these benefits using the money in your existing Retirement accounts. And as long as you follow IRS rules you can perform a Gold IRA rollover without paying any taxes or penalties.

Before you start the rollover process, however, it’s important to know what it is, how it works – and what it could cost you.

Let’s start with the basics.

What is an IRA?

Individual Retirement Accounts, or IRAs, are tax-advantaged Investment accounts that offer special tax advantages to retirement savers. With an IRA, you contribute earned (taxable) income and invest the funds into appreciating or dividend-paying assets. As of 2023, you can contribute up to $6,500 ($7,500 if you’re 50+) per year into your IRA.

Broadly speaking, you can open three kinds of IRAs as covered above.

Traditional IRAs accept before-tax dollars that you can write off on that year’s taxes. Your funds and invested assets grow tax-free until you make qualified withdrawals in retirement. At that time, you’ll pay applicable income taxes on distributions (withdrawals).

Roth IRAs take after-tax dollars, which means you can’t deduct these contributions from your tax bill. However, your money will grow tax-free, and when you take qualified withdrawals in retirement, you won’t have to pay any taxes on your contributions or capital gains.

Bear in mind that these tax rules only apply to qualified withdrawals. If you pull money out of a traditional IRA before age 59.5, you risk a 10% early withdrawal penalty on top of any applicable income taxes. Roth IRA owners who withdraw funds before the account is five years old also risk a 10% penalty and income taxes on capital gains – even if you are past retirement age.

What is a Gold IRA?

Gold IRAs, also referred to as Precious metal IRAs, are a type of “self-directed” IRA (SDIRA).

SDIRAs provide investors with the flexibility to make Investments in a wide array of alternative assets including Precious metals, Real Estate, Commodities, and even Cryptocurrency.

This opportunity to expand your Investment horizons comes with unique advantages, such as:

• Diversifying your Portfolio into assets that don’t move in synch with the Stock and Bond markets
• Minimizing your overall tax burden on high-growth assets
• Hedging your Portfolio against economic downturns and market volatility

Gold IRAs are a specialized form of SDIRA that allow you to add physical Gold, Silver, Platinum, and Palladium to your long-term retirement strategy.

It is important to understand that a Gold IRA is the only way you can protect your tax-advantaged retirement savings with Precious metals. Unless you cash-out your existing Retirement account and pay the taxes and penalties, there are no other options for putting your hard-earned savings into physical Silver and Gold.

What is an IRA Rollover?

The IRS permits three kinds of asset movements between Retirement accounts:

• Rollovers move funds and assets between different accounts. The funds transfer directly from the Custodian of the existing account to the Custodian of the new account.

• Transfers accomplish the same result as a rollover, but you act as a middle-man in the transaction. In other words, you take a distribution from your existing account and then forward that money to your new account.
• Conversions change an account’s tax status (e.g., a traditional IRA to a Roth IRA).

An IRA rollover or transfer, then, involves moving funds from one Retirement account to another Retirement account of the same type (traditional to traditional, or Roth to Roth).

The purpose of a rollover or transfer is to ensure that you maintain the tax-advantaged status of your retirement savings. Done correctly, an IRA rollover won’t trigger a tax bill or early withdrawal penalties.

What is a Gold IRA Rollover?

A Gold IRA rollover involves rolling or transferring funds from one Retirement account into an SDIRA that permits Precious metals transactions. After funding your Gold IRA account, you can use the money to add Precious metals to your long-term retirement strategy.

How Does a Rollover Work?

IRA rollovers can follow a few different procedures, depending on your preferences and the account(s) and administrator(s) involved. When you choose a Gold IRA company they will help you walk through the rollover process. You’ll also want to consult with your tax preparer on the IRS regulations regarding asset transfers, lest you accidentally generate an unexpected tax bill.

Direct vs. Indirect Rollovers

Some accounts permit either direct or indirect rollovers, while others limit your options. Understanding the difference is crucial to avoiding accidental taxes and penalties.

A direct rollover involves your current account administrator transferring funds and/or assets from your existing account to your new one. They may do this by contacting your new account administrator directly, or by handing you a check payable to your new account.

Indirect rollovers require more effort. With an indirect rollover, your current account administrator cashes out your account under your name. Then, you have 60 days to deposit the check in your new account to avoid taxes and penalties.

But that’s not all. Indirect rollovers also require your administrator to send 20% of your withdrawal amount to the IRS to pay potential taxes. If you deposit the full withdrawal amount within 60 days, you’ll get that money back at tax time. But if you can’t afford to front that 20% from your own pocket, you’ll owe taxes on any “leftover” amount.

Between the two, direct rollovers are less likely to generate a tax bill. However, not all plans permit direct rollovers, so you should ask about your options before committing.

Eligible Rollover Distributions

Any funds you’re allow to roll into an IRA are called “eligible rollover distributions.” They can stem from a variety of sources – but there are some limits.

If you’re conducting an IRA-to-IRA transfer, you won’t be able to deposit required minimum distributions (RMDs) or excess contribution distributions. And in plan-to-IRA rollovers, you can deposit some or all funds except for:

• RMDs
• Loans or S corp. allocations treated as distributions
• Distributions taken to pay for hardships or insurance
• Excess contribution distributions
• Dividends paid on employer securities

Taxes and Penalties

In general, cashing out your Retirement account before age 59.5 exposes you to the risk of being slapped with a 10% early withdrawal penalty. If you cash-out a Roth IRA before the account is five years old you will also be at risk of the 10% penalty, regardless of your age.

Rollovers and transfers, however, are usually tax and penalty-free as long as you follow IRS rules and procedures.

Changing the status of a traditional account to a Roth account will result in a tax bill - you’ll owe income taxes on the transferred amount. It isn’t possible to change from a Roth account to a traditional account because you can’t move post-tax funds to a pre-tax account.

Annual Rollover Limits

The IRS doesn’t restrict how much you can rollover or transfer from one account to another. It does, however, limit how often you can perform these changes.

As of January 2015, IRS regulations prohibit you from making more than one 60-day indirect rollover per year – no matter how many IRAs you have.

That said, the limit is fairly narrow in scope, as the one-per-year rule does not include:

• Direct rollovers
• Traditional to 401(k) conversions
• Trustee-to-trustee transfers between IRAs
• IRA-to-plan rollovers
• Plan-to-IRA rollovers
• Plan-to-plan rollovers

Attempting a second 60-day indirect rollover in a single tax year risks distributed funds being labeled “excess contributions” and taxed at 6% annually until they’re withdrawn.

Contributing to Your Rollover IRA

Rollover funds don’t count as IRA contributions in the IRS’ eyes, which means you can complete a rollover and add funds to your account in the same year. For 2023, IRA contribution limits are set at $6,500 per year ($7,500 if you’re over 50).

Is a Gold IRA Rollover a Good Idea?

IRA rollovers are increasingly-common in the modern age, thanks to their unique benefits.

For one, IRA rollovers don’t shackle you to a dollar amount, so you can bypass annual IRA contribution limits. (Not to mention the chance to switch tax designations to protect any capital gains you accumulate.)

Once the money is in your new account, most IRAs offer more Investment control than employer-sponsored accounts. That’s doubly true for SDIRAs and Gold IRAs, which offer access to a broader range of assets.

Many IRAs also charge fewer or lower fees than more actively-managed 401(k)s, so you can keep more of your hard-earn money. (That said, however, do watch out for Gold IRA fees that eat into potential returns.)

Should You Do a Gold IRA Rollover?

Gold IRA rollovers allow you to supercharge your IRA without running afoul of IRS contribution limits. In some ways, rollovers also let you change strategies or start over, as you can switch tax advantages and move to a more flexible Investment structure.

Of course, you’ll want to do your homework before opting for any rollover, as one wrong move could result in taxes and early withdrawal penalties!

If you’re ready to take the next step and add Precious metals to your retirement strategy, Satori Traders has researched the Gold IRA companies and identified the top three. If you have $50,000 or more to invest, contact Augusta Precious Metals. For Investments of $25,000 to $50,000, Goldco is your best option. If you are investing less than $25,000 then get in touch with Birch Gold.

About Satori Traders

Hi, my name is Bryan Post and I love the shiny stuff - Silver and Gold.

I've been investing in the Precious metals and mining stocks since 2002 when I realized that Gold is the only real money on the planet.

Here on Satori Traders I share everything I've learned about the metals, Financials markets, trading, Technical analysis, and the numerous games that central banks play with fiat currencies.

https://satoritraders.com/precious-metals/gold/ira/types/