7 Important Reasons Why You Should Own a Gold IRA

Written By Alla Levin
February 28, 2023
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When you start working, you’ll also start thinking about stopping. No, I’m not saying you’ll get sick of it very quickly, because we all like being useful, and work allows us to feel that way. What I am saying, though, is that you’ll have to stop at one point, and you will want to be financially safe and independent even after that point. That’s why thinking carefully about what will happen after you stop working is important.

Simply thinking about it and not taking any concrete steps towards securing your financial future, though, isn’t the wisest thing to do. After all, nobody will come knocking at your door and provide you with the money you need after retiring. Instead, you have to work towards setting that money aside while you’re still younger, i.e. while you’re employed, as that’s how you’ll achieve the security you’re after. How about putting that money to work instead of simply setting it aside, though?

If you choose to just save up and do nothing else, that’s fine. Or, at least it will be fine if the market situation doesn’t change too much in those years leading up to your retirement. You’ll have the amount you’ve saved up and you’ll be able to provide for yourself that way.

Putting your money to work, on the other hand, could lead to accumulating wealth and basically getting richer than you’ve expected you’ll get, while not even lifting a finger, so to speak. This is a long-term game, though, so make sure you’re in it for the long haul if you decide to play it.

You’ve probably seen right through me and guessed the game I’m referring to because the only way to put your money to work is through investing it. The investment game, however, has changed quite a bit compared to the earlier days when bonds and stocks were all you could hope for. Precious metals have entered the market, and many people saw that as an opportunity to add them to their portfolios and use, say, gold to save for retirement.

A gold IRA is an account that allows for such alternative investments, and it is the only one so far that you can count on when wanting to buy gold or other precious metals. It is, as explained on this page, a special account that you can use to hold coins and bullion, and it’s become rather popular recently. You’ve most likely heard of it already, but you’re unsure if owning it is the right thing for you. Well, let’s get you informed about some important reasons why owning a gold IRA could be a great move, as that will shed some light on things and bring you closer to deciding if this is something you want to do as well.

Why You Should Own a Gold IRA: Retirement InsuranceWhy You Should Own a Gold IRA

Holding a large portion of a specific stock in a retirement account is like gambling. You could come out as the winner if the company makes a boom on the market and achieves great success. On the other hand, if it goes out of business, you could find yourself left with nothing, even though you’ve spent a lot of time carefully crafting your portfolio and hoping for the best outcome. The worst outcome is always a possibility, and you should expect it if you don’t want to get too disappointed. Although, not getting disappointed after losing money is pretty much impossible.

What does gold have to do with the above talk, however? Well, gold, as well as some other precious metals, have been significant ever since they were first discovered, and history shows that their value is not likely to reach zero.

Gold cannot go out of business, so to speak, which means that it offers an additional layer of security to people’s retirement portfolios. If you add it to yours, you’ll feel much safer, knowing that you won’t have to experience those disappointments after losing all of your money, simply because you won’t lose all of your money as long as you have this asset.

Better Control Of Your Assets

If you’re used to those traditional retirement accounts, then you’re also used to being limited with your investments, and being allowed to buy only those public bonds and stocks, Treasury notes, or mutual funds. Furthermore, you’re used to being locked into a pre-determined asset group that your custodian has chosen. Those are quite some heavy restrictions, but the great thing is that you can say goodbye to all of them when you set up your gold IRA.

You’ll still need a custodian, but, since this account is self-directed, you won’t be restricted by those asset groups and you’ll have full control of the assets you wish to hold in the account. This also gives you better control of the risks you’re taking, allowing for better risk management, and ultimately leading to a safer financial future. Since you’re the one in control over that future, making it safe will undeniably be your priority.

Inflation HedgeWhy You Should Own a Gold IRA

During inflation, the paper assets can plummet significantly. Cash, for example, can lose its purchasing power and stocks can easily drop in value. This can weaken the health of your traditional IRA, i.e. the one holding only those traditional assets, such as bonds and stocks. Everyone always feels the consequences of inflation, but what if I told you that you can reduce those consequences to a minimum?

Among all the benefits of gold IRAs, this is the one that people are usually most happy about. Gold has always performed quite well in times of inflation in the past, and you’ll see that the moment you check out its history, so we can only expect it to behave in that same way in the future. In fact, the price of this asset tends to increase whenever costs of living increases, meaning that it won’t get devalued or lose its purchasing power. This is another reason why people use gold as a sort of insurance asset for their entire portfolios. After all, if other assets flop, they’ll still have this precious metal to fall back on.

Tax Advantages

Investing through your IRA, instead of a brokerage firm, will yield higher tax-rates of return, essentially meaning that you’ll get more wealth to fund your retirement if you decide to use this account. Furthermore, making tax-free contributions is possible with this account as well.

But, if you want to roll over the funds from your 401k or your traditional IRA to the gold one, you’ll have to do it carefully, and within a specific time frame, so as not to pay income taxes after making the withdrawal. Getting professional help with the rollover is the best way.

Steady Returns

Gold is an asset that gradually grows in value, and those gradual growths are bound to lead to steady and high returns. The longer you hold on to the precious metals you’ll buy today, the more they’ll probably be worth it.

Until the time comes for you to retire, you can find yourself getting a rather high return on investment, which is certainly a big deal. Even if this asset does experience certain dips and drops from time to time, it will definitely still be worth a lot more than when you first bought it. Great returns are every investor’s dream, so there’s another reason for getting a gold IRA.

Potential For Growth

Those economic factors that weaken bonds, stocks, and other types of traditional assets actually present a potential for growth for precious metals. If you remember the talk of their behavior during inflation, this should be perfectly clear to you. Since the times we’re living in are unstable and uncertain, it is exactly the instability and the uncertainty that will drive the price of gold up, thus leading to your portfolio being strong and stable despite everything that’s going on. Your wealth will keep on growing if you own this asset, which is definitely something to look forward to.

Why you Should Own a Gold IRA: Diversification

One more reason to consider, although this one should be completely clear by now, is diversification. Everyone understands the dangers of holding all of their money into one asset because that one could flop overnight, and leave you without a penny. Gold is, of course, the perfect diversification asset because it will never flop that much. As explained above, you can expect it to grow instead.

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