Gold and Precious Metals IRAs

To understand the answer to this question, we first have to understand the difference between a standard IRA and a Self-Directed IRA. A standard IRA is typically run through a brokerage whose accounting systems and business models are focused almost entirely on stocks, bonds, and related products. Physical gold does not fit into this structure, and thus is not offered with a standard IRA.

A Self-Directed IRA removes the limitation of asset choice. With the investor himself acting as the non-compensated manager, there is obviously no bias towards Wall Street style products. This allows for the possibility of investing in gold. To look at it another way, a Self-Directed IRA does not necessarily give you more investment options; rather, it removes the barriers artificially imposed by the brokerages.

Are there different Self-Directed IRA platforms that can be used to invest in gold?

Yes. The two different “flavors” of Self-Directed IRA platforms are the Trust model and the Checkbook Control model.

Many of the gold IRAs that are being advertised are based on the Trust model. The reason for this is that the profit margins are potentially much higher. The Trust model allows the company to charge managerial fees, transaction fees, and dictate the source of the gold.

With a Self-Directed IRA based on the Checkbook Control model, there are no managerial or transaction fees, and the investor is free to purchase from the gold dealer of his/her choosing. For investors who want to maximize their retirement funds, Checkbook Control is by far the most robust option.

Can I rollover an existing retirement fund into a Self-Directed IRA?

Certainly. Virtually any retirement account can be rolled over into a self directed IRA, and it can be done without any tax penalties or early distribution fees.

What if I decide at a later date to invest in something other than gold?

A Self-Directed IRA gives you continual asset choice. You always have the power to sell your gold holdings, and reinvest the funds in a different asset.