Find the Best Gold IRA Companies

Gold and other precious metal IRAs are an investment and carry risk. Consumers should be alert to claims that customers can make a lot of money in these or any investment with little risk. As with any investment, you can lose money and past performance is not a guarantee of future performance results. Consumers should also obtain a clear understanding of the fees associated with any investment before agreeing to invest.

A gold IRA is a self-directed individual retirement account that holds gold or other approved metals instead of paper assets. Unlike other retirement accounts, a gold IRA is backed by actual, physical gold. Other than this crucial difference, a gold-backed IRA is not much different from a traditional or Roth IRA.

With a gold IRA, you don’t hold the gold yourself — it’s stored in a secure depository. (If you want to buy gold directly and hold it yourself, you can buy it from a gold dealer.)

For those interested in gold investments, it’s essential to research the potential risks and rewards. For instance, gold can be a smart way to diversify your retirement portfolio because it has historically held its value during inflation. The flipside of this is that gold’s value tends to slump when stocks are doing well.

Gold IRAs function much like traditional retirement accounts, but your investment is backed with gold and other precious metals, including silver, platinum and palladium. Most people start a gold IRA with $10,000 or more, but gold IRA companies also sell physical gold to those who can’t afford a large initial investment. The gold is then stored in a secure storage facility managed by the gold IRA company.

There’s more involved in setting up a gold IRA account than depositing money into it. A brokerage firm buys the precious metals that back the funds in your IRA. The custodian, or trustee, then sets up and manages the account. Potential custodians include banks, credit unions, trust companies, loan associations or other organizations with federal or state approval. The IRS also lets you hold gold in EFTs or mutual funds.

1. Transfer funds into the account. Most gold IRA companies have a required initial minimum investment. This can be as high as $15,000 or as low as $100, but it typically ranges from $2,000 to $5,000. Be sure you’re aware of a company’s account minimum. You have the option to buy precious metals with pre-tax or post-tax dollars.

   For 2020, the annual contribution limit set by the IRS is $6,000. If you are 50 or older, the limit is $7,000. If you already have an IRA, you can convert or roll over part of your existing account into bullion or coins. There are no gold IRA rollover fees, and the rollover is not subject to taxes. The IRS also regulates contribution limits for rolling over investments into a gold IRA account.

2. Pay commissions and fees. Brokerage firms and dealers charge commissions when they sell precious metals. Commission fees are typically between 2% and 5% above the spot price of gold. On average, expect to pay $30 to $50 in commission fees per transaction. Additional fees associated with gold IRAs include:
   • Setup fees: Gold IRA companies typically charge a one-time processing fee for setting up your gold IRA account. This can range from $50 to $100.
   • Storage fees: The depositories that hold your gold charge a yearly fee, and your gold IRA administrator passes this expense onto you. Most gold IRA account holders pay $100 to $300 per year for storage and insurance.
   • Annual maintenance fee: Maintenance fees can be anywhere from $50 to $300 per year. Some gold IRA companies waive the first year of maintenance fees, but not all.
   • Miscellaneous fees: The company you work with should disclose any additional charges, including wire transfer fees, to you when you open your account.
3. Withdraw your cash at the appropriate time. When you want to access your money, contact your custodian or trustee and fill out the necessary forms. It can often be less attractive to withdraw from gold IRAs since it might not be a good time to sell the gold backing it, but you can withdraw money from other IRA accounts you have instead.

   Once you reach the age of 72 (or 70½ if you reached that age before Jan.1, 2020), you’re subject to required minimum distributions, which means you must withdraw a certain amount from your IRA accounts each year. You will have to pay penalty taxes if you withdraw funds before the age of 59½ or if you haven’t had the account for a certain amount of time, typically five years.

Investing in a gold IRA has many of the same risks as any retirement accounts. Perhaps the most significant benefit of a gold IRA is it allows you to diversify your retirement portfolio. Proponents of gold IRA investments tout the reliable value of gold compared to the inconsistent value of the paper currency.

How much precious metals are worth on any given day depends on a variety of economic factors, including industrial demand, production supply, the value of the dollar and the overall market health. Historically, gold has increased in value during times of long-term inflation or economic uncertainty.

Opponents of gold IRAs don’t like the higher fees and storage costs compared to traditional or Roth IRAs. Gold and silver assets also don’t pay dividends or produce income stocks. Plus, there are rules about holding collectible coins, and you can’t keep your gold in your house.

If you want to invest in gold as part of your retirement plan, here are some tips for navigating the world of gold IRAs.

Find a reputable gold IRA company

Gold IRA investors should choose companies that complete transactions honestly and transparently. Avoid companies that advertise “special” home storage offers or “collectible” coins that aren’t approved by the IRS.

• Read gold IRA reviews: Spend time reading online reviews from clients to learn more about their experience with the gold investment company. Some scammers can appear legitimate, so it’s vital to consider how many years a company has been in business and what reviewers say about it.
• Work with a dedicated advisor: An experienced gold investment advisor is familiar with your existing portfolio and can provide personal advice based on your financial goals. If you’re new to gold IRAs, work with a smaller company that can help you find your footing before exploring your precious metal investment options.
• Consider the depository: According to IRS regulations, precious metals can be stored in allocated or unallocated depositories. Most gold IRA companies let you choose which kind of vault you prefer, whether domestic or offshore.
  • Allocated depositories: More like a safety deposit box. In an allocated depository, your precious metal inventory is kept in something like a safety deposit box. The box contains the actual coins or bullion you purchased. Your gold is your gold, and it’s all in your box, where it can’t touch anybody else’s gold.
  • Unallocated depositories: More like a high-security warehouse. Unallocated depositories store their inventories of precious metals based on size, weight year and refinery. When distributed, investors receive the same type of coin or bar they purchased, but it probably won’t be the same physical object.

Purchase high-quality assets

Unlike stocks, bonds and traditional assets, gold is a tangible commodity, and the condition and quality of gold factors into its worth as an investment. Disreputable brokers buy damaged metals and resell them at the price of pristine stock, so check the gold quality before purchasing. Precious metals are valued by their weight, so scratched or damaged bars and coins are less valuable than they would be in as-new condition. You should only accept the stock if it weighs what the manufacturer intended. Gold, silver, platinum and palladium are eligible to be placed in an IRA.

• Gold: Gold bullion and coins the most popular investment when it comes to precious metals. The Internal Revenue Code requires gold to have a minimum fineness of .995 to be eligible.
• Silver: Silver is the second-most common type of precious metal used in IRA accounts after gold. It needs to have a minimum fineness of .999.
• Platinum: Platinum can be stored in coin or bar form and must meet a .9995  purity level to qualify for IRA storage. It can be stored in conjunction with gold, silver and other precious metals.
• Palladium: Palladium was discovered in 1803 and named after Pallas, an asteroid that drew its moniker from the Greek goddess Athena. It needs a minimum fineness of .9995. Palladium, which resembles platinum in appearance, tripled in value between 2016 and 2019.

Stay up-to-date on spot prices

Like other commodities, the price of precious metals is determined by the market. The price of gold goes through fluctuations associated with other markets. Although more constant, gold prices still go up and down. The market value of gold, silver and precious metals fluctuates regularly, which means that posted sales prices need to be updated frequently.

It’s smart to buy bars over coins when you can. Generally, gold dealers earn higher commissions by selling coins, but bullion bars are a more accurate reflection of the spot price.

Always request detailed receipts

Vault receipts, sometimes called warrant or warehouse receipts, prove the ownership of your precious metal commodities and confirm transfers. Detailed receipts are necessary to prove or disprove the true value of any precious metals that have been sold or purchased, especially at the date and time of purchase.

Follow all IRS gold IRA rules and regulations

Rare and collectible gold coins offer unique investment opportunities, but their worth and legitimacy must be checked. As mentioned above, the IRS has specific requirements for what types of gold bullion are acceptable to be held in a gold IRA. Read about the IRS’ rules for individual retirement arrangements and investment regulations for more information.

When choosing a gold IRA company to invest with, you need to consider multiple factors. We compared ConsumerAffairs accredited IRA companies on overall consumer rating and number of reviews, minimum investment requirements and annual fees. Read recaps of our top picks below.

Patriot Gold Group

Accredited Partner

Annual fees: $180 Minimum investment: $9,500 Standout feature: 24-hour account set up

Precious metals products: Patriot Gold precious metal products include retirement accounts, bullion and coins. IRAs can hold gold, silver, platinum and palladium. New clients can get up to $2,500 in complementary gold coins when they open a new account.

IRA fees: The company charges a one-time setup fee of $225 if you’re opening an account with less than $30,000. Patriot Gold Group waives the first year of service fees and reimburses rollover fees. Clients typically pay $180 a year after that. Investors with accounts of more than $250,000 don’t have to pay service fees.

Management approach: We like that Patriot Gold customers have a chance to work directly with the owners. Those favoring a small-business feel appreciate the close attention they receive from Patriot Gold.

Advantage Gold

Accredited Partner

Annual fees: $175 Minimum investment: Varies Standout feature: First Time Gold Investor Program

Precious metal products: Advantage Gold specializes in gold individual retirement accounts. Approved gold, silver, platinum and palladium coins are also available, as well as basic precious metals IRAs and IRAs for public investments through Strata Trust Company.

IRA fees: The company’s one-time startup fee is $50. After that, annual storage fees range from $75 to $250. Electronic statements are free, but there’s a $30 fee if you want paper statements. Yearly storage fees are between $100 and $140. The company waives first-year fees for customers who invest $50,000 or more. Additional service fees apply.

Management approach: Advantage Gold’s First Time Gold Investor Program guides consumers new to gold through the process and teaches them how to make smart investment decisions, avoid scams and meet their retirement goals.

Red Rock Secured

Accredited Partner

Annual fees: $125 - $300 Minimum investment: $1,500 Standout feature: Never Zero Policy

Precious metal products: Red Rock Secured offers gold and silver IRAs. Qualifying clients can get up to 10% in free gold and silver on their accounts.

Services and fees: Fees for small accounts can be as low as $125, but larger accounts are as much as $300 a year. The company waives all fees for the first year, and some accounts qualify for no fees at all.

Management approach: All new clients get a free one-on-one consultation to learn about diversifying their retirement plans. We also like that Red Rock’s Never Zero Policy guarantees that no qualifying client’s portfolio ever reaches $0.