Gold has been a source of wealth for humans since the beginning of time.
The people of centuries-old civilizations were also well-aware of the value gold possesses, which is why they traded, accumulated, and bartered gold more often than not.
Historical archives indicate that the Egyptians and Mesopotamians living during the 3rd millennial B.C. exchanged gold bars that were weighed to establish their value. Later human civilizations moved on to gold coins as those were easier to carry and trade.
Fast forward to the 21st century; gold still carries immense financial prominence. Although it has been through rough patches, when its prices dwindled for a bit, it remained a valuable asset.
One of the principal reasons behind gold’s stable standing as an asset throughout history is its ability to freeze paper money, which is a depreciable asset.
Since traditional currency easily loses its value when the economic landscape is unsteady for any number of reasons, it is not a reliable form of preserving wealth
But with gold, that’s not the case. Gold is a physically robust asset that cannot be easily destroyed or debased. It means that any amount of affluence converted to gold doesn’t devalue.
From Tangible Gold to Paper Gold
Whenever the world has been hit by a wave of inflation or faced geopolitical turmoil, the value of the dollar dropped. But on the other hand, the gold prices soar as high as possible, demonstrating how the yellow metal is a dependable hedge for uncertain times.
Therefore, people invest in gold bars and bullions to manage future risks. However, as technology advanced and the world shifted to all things digital, gold also became a virtual commodity.
That is, to avoid the hassle of keeping physical gold, people started invested in gold bonds and stocks, which are documents stating that you own a share of gold in a company.
Now, while digital or paper gold is not real, it has become a common investment phenomenon. But, some conventional investors prefer real gold over gold stocks or funds, which is why they invest in gold IRAs.
Gold IRAs are retirement plans that allow retirees to preserve their savings as real gold. This way, they can keep their funds from depreciating and losing value over time.
Investing in the honey-hued metal can be a little challenging as it entails an elaborate process for setting up an account and following the IRS protocols.
However, with the influx of so many gold companies, setting up IRAs has gotten much more comfortable and manageable. That said, the wide variety of gold IRA companies also poses a problem for investors as they struggle to choose the most suitable one for their portfolio needs.
Considering the confusion that having a plethora of options can create, we decided to put together an extensive guide on the best gold IRA reviews. In this detailed article, you will get all the information about the top players of the gold IRA industry.
Let’s go over our top five picks from the gold-backed IRA market.
Best Gold Based IRA – Reviews & Buying guide for 2020
Best Overall: Gold Co
- Type: Traditional IRA / Roth gold IRA.
- Weight: Various
- Size: 1, 5, 10 and 100 oz
The first on our list of best gold IRA companies is the glowing GoldCO, and for all the right reasons. To begin with, it is a customer-oriented enterprise that focuses on delivering top quality services to its clients.
GoldCo is known for its professional and consultative approach to running the business. The employees at the corporation take pride in rightly guiding their clients, making sure that the IRA plan drawn caters to the investor’s needs perfectly.
Aside from providing topnotch services and unmatched attention to detail, GoldCo also offers the best IRA gold depository that keeps all the assets neatly separated and secured in ultra-safe lockers.
GoldCo is undoubtedly the perfect facility for investors looking for unhindered access and accountability. A testimony to the company’s excellence is the recent nod by Dr. Ron Paul, the former presidential candidate of the United States of America.
The only drawback that can be a deterrent for some investors is the high annual charges for gold IRA; GoldCo asks for $25000 per year for their gold IRAs, which can be a lot for many buyers.
GoldCo offers an excellent buyback program that puts the client at ease as they can back away from the deal amicably in case the terms aren’t suitable for them at minimal liquidation fees.
People at Goldco realize the importance of securing retirement funds, which is why they ensure that their clients get the best plans to preserve their savings and live comfortably without fears.
The company has a splendid reputation in the market that boasts of GoldCo’s white glove services like nothing else. It undeniably has the best rated gold IRA varieties as per the raving reviews that Goldco keeps receiving.
So, if you are looking for a trustworthy and secure facility to get your gold IRA, Goldco should most definitely be among your top choices.
Runner-up: I Trust Capital
- Type: Traditional, SEP, or Roth IRA
- Weight: various
- Size: 1 oz. to no maximum limit
ITrustCapital is a low-investment platform that allows customers to buy and sell gold at reasonable rates at any time. Clients are provided the honey-hued metal for their IRAs through Kitco Metals Inc, which is a leading mineral refinery and retailer.
Opening an account with ITrustCapital is unbelievably easy and fast, and it doesn’t even have a setup fee. Moreover, clients don’t have to pay a storage fee for their assets.
ITrustCapital’s most noteworthy quality is the ease of switchover between retirement accounts, making it the best gold IRA rollover facility. It is also one of the most transparent gold companies that take pride in their fair dealings and pricing.
Like every other service/product, ITrustCapital comes with drawbacks, though not too many.
The company only lacks in the advice department, as it doesn’t offer much guidance to customers regarding retirement planning. So, you need to be sure about how you want to treat your retirement funds before setting up an account at ITrustCapital.
ITrustCapital offers a wide variety of cryptocurrencies, so investors can further diversify their investment portfolios without having to look for another facility.
For people looking for simple account setups, affordable pricing, and super easy rollover procedures, ITrustCapital is a hands-down exceptional choice. It is unquestionably the second-best gold IRA company, if not the first.
If you are a newbie investor, then you should start your journey with ITrustCapital, so that you are not put off by the cumbersome account setting process that is common at other gold companies.
Alternative: Augusta Precious Metals
- Type: All Gold IRA choices
- Weight: Various
- Size: 1 oz. to 10 oz. bars, 1 oz, 1/2 oz, 1/4 oz, and 1/10 oz coins
Augusta Precious Metals is a veteran in the field of metal trade. Nearly 50 years old, the reputed family-owned company is known for helping people make profitable investment choices to manage risk.
Its service quality is next to none, a feature that can be attributed to the company’s years of experience. From the best gold IRA programs to incredibly secure storage facilities, Augusta Precious Metals offers scores of topnotch services to clients.
Being a senior in the field, Augusta Precious Metals is a little conventional with regard to how it operates the business; that is, there is no way to place an online order, which might not sit well with young investors.
Augusta Precious Metals offers a 7-day Price Protection on premium coins.
So, that acts as an incentive for those who wish to try investing in metal coins rather than bullions.
If you are someone who values experience and trusts skills that one can only learn after spending years on honing them, then Augusta Precious Metals is the choice for you.
Their diverse client portfolio is a testament to their immutably top-grade services, and you can become the next addition to it.
Alternative: American Hartford Gold
- Type: All gold IRAs
- Weight: Various
- Size: composites of 50 X 1g Gold and 20 X 1g Gold, 1 oz. ¼ oz. coins
American Hartford Gold is an LA-based family-owned business that deals in precious metals, particularly gold IRAs.
It is recognized as a frontrunner in the business sphere. People at American Hartford take pride in their splendid customer service; they are known for extensively coaching retirees on retirement plans so that the client makes the most out of the deal.
The Los Angeles enterprise makes sure to declare all its charges before signing the agreement with its clients, which has earned it a stellar reputation. Customers also get excellent buyback programs that reduce liquidation fees considerably.
Although the employees at American Hartford Gold disclose all the company’s charges before finalizing a deal, customers cannot get a quote through their online catalog.
American Hartford Gold conducts extensive market research and consults past investment records for their customers so that the most profitable plan can be opted.
Being a well-known and reputable name, American Hartford Gold is a reliable company that will surely deliver what they claim. If you want transparency and the most astute guidance on retirement accounts, then you should consult the LA-based gold mogul.
Alternative: Lear Capital
- Type: All gold IRAs
- Weight: Various
- Size: 1 oz. 1/2 oz. 1/4 oz. 1/10 oz. gold coins
Lear Capital is a well-recognized name in the precious metal IRA industry. It has made more than $3billion in transactions over the 20 years that it has existed, naturally acquiring a top rank among the most noteworthy IRA companies.
Lear Capital offers a wide range of excellent services to its customers, including smooth transactions, no fee buyback programs for seamless liquidation of assets, and expert advice on investments.
It is one of the very few companies that has mostly received compliments on their performance.
The California-based company boasts of its investor-friendly services that are meant to help the clients in all investment matters.
Customers can easily set up accounts with Lear Capital without any hassle, thanks to the super simple procedures and helpful staff. Furthermore, they can conveniently switch accounts without having to pay any tax penalties.
Storage of assets at Lear Capital comes with a charge. Though a modest fee, clients are asked to pay some amount of money to enjoy the safekeeping services by the company.
Easy Transfer between accounts!
Many investors are often dissuaded from changing IRAs because of the obscurity of the process, but at Lear Capital, that’s not the case. Clients can easily change accounts with any penalties or taxing procedures. Plus, the knowledgeable staff helps investors every step of the way.
Many investment experts consider Lear Capital as the best gold back IRA facility, and they are not wrong. The company’s mind-blowing revenues clearly illustrate the capability it possesses and the trust its customers have in its services.
Dealing in gold IRAs can seem a bit tricky and sometimes even daunting, especially to the inexperienced investor but with the support of the approachable team at Lear Capital, even the most novel trader makes the most sensible investment decisions.
If you are someone who hasn’t really dealt with financial institutions before but now is worried about post-retirement financial matters, you should reach out to the representatives at Lear Capital to know what you can do to achieve financial security.
Are Gold IRAs A Good Idea?
A gold IRA is a self-directed investment account that has to be managed by the investor themselves, and can carry a wide range of products, unlike other IRAs.
It means that someone with a gold IRA can freeze their savings/retirement funds in a physical asset to redeem equivalent cash any time in the future if need be. But is it judicious to fixing all your reserves in a precious metal to retrieve lump sum cash later?
There is no straightforward answer to this question, as it’s a somewhat subjective choice. Whether IRAs are a good idea or not depends on the investor looking for avenues for investment.
That is, a person has to decide if they want to own (but not hold) gold bars instead of paper assets that offer quarterly or biannual earnings in the form of dividends. Both forms of investments have their own set of pros and cons, which an investor must weigh to make an informed decision.
Gold is a dependable investment in the sense that it maintains its value regardless of the economic climate. Gold prices had soared from $225 in 1999 to approximately $1839 per ounce in 2011.
And according to the reports, gold held up its value at $1700 per ounce in 2017. The consistent rise in gold prices, despite the occasional yet negligible drops, goes to show that gold remains financially advantageous for the most part.
In fact, generally, gold prices move in the opposite direction of paper assets, which means that when the value of a traditional currency drops, the cost of gold increases.
So, if inflation hits the economy, someone with a gold IRA can use the precious metal as a hedge. But all that is not so simple. Having a gold IRA is not easy as it entails a tedious opening process and costly management.
If you wish to invest in a gold IRA, you first need to arrange for a broker (to buy the gold for you) and a custodian (who will hold the gold in their possession even though you own it). Moreover, you cannot just randomly choose anyone as the custodian; it has to be someone approved by the IRA.
The gold you purchase must also meet the requirements of IRS fineness standards, while the depository where the metal will be stored must also carry the IRS’s stamp of approval. And that’s not all.
After you have managed to get all the needed resources to open and keep a gold IRA, you must transfer it to the depository in such a way that the custodian can overlook the process and be witness to it.
And needless to say, all this hassle comes with quite a few one-time and regular fee payments at various touchpoints. Furthermore, a gold IRA is not tax-safe; you need to pay a sum of your total profit (as per the present rate) at the time of withdrawal.
If you want to go through all that to receive a significant sum of money in the end, then a gold IRA is undoubtedly the right choice for you.
But if you want to make periodic earnings that are also tax-sheltered, you might want to consider investing in paper gold, though it might not be as profitable at the end as physical gold.
In a nutshell, physical gold appreciates in value over time, so it offers a hefty end-profit, which generally remains substantial even after the tax deduction.
Conversely, paper gold (mutual funds or stocks in gold companies) doesn’t necessarily appreciate, but it promises regular income without any tax obligations. Which one out of the two is a better investment choice depends on the investor’s preference.
Can You Invest In Gold In An IRA?
An IRA is an individual retirement account that has many types. A person looking to fix their retirement funds can choose from various IRA plans to manage their money post-retirement. They can either invest in a conventional IRA or decide to go with a self-directed IRA.
The difference between the two plans is the freedom of choice and action. In the case of a conventional IRA, a bank is in charge of all the investments, while the investor has little to no say in the matter.
But if someone opens a self-directed IRA, they have the authority to make their own financial decisions and choose what they wish to keep in their investment portfolio.
Now, can you invest in gold in an IRA?
You most definitely can, but only if you get a self-directed account. Otherwise, you’ll have to accept whatever investment decisions your bank takes for you.
That said, there is nothing wrong with choosing a conventional IRA as bank employees are, after all, trained professionals who know all too well which investment will be profitable and which won’t be, but this authoritative form of dealing doesn’t sit well with some people as they want to be in control of their choices.
Thus, self-directed IRAs empower people to make financial decisions on their own, including whether to invest in gold or some other precious metal.
How Is Gold Taxed In An IRA?
Physical gold held in an individual retirement account is treated as collectibles, which are defined as tangible personal properties that carry additional value due to rarity or market value, such as gems, baseball cards, rare books, and antiques.
Hence, gold bars or bullions kept in an IRA are taxed as any other collectible item.
The reason to apply taxes on physical gold in IRAs is to discourage people from hoarding bullions and bars as that can be detrimental to the economy. However, people still prefer to keep gold and other collectibles in accounts, so they have to pay the tax on the acquired sale proceeds.
Profits from the sale of a collectible that’s held for more than a year are taxed as long-term capital gains but not at the standard rate of 0, 15, or 20. Generally, the tax rate imposed on gold in an IRA kept for longer than a year is 28%.
For all short-term investments (collectibles kept for less than a year), the tax rate is the same as a taxpayer’s ordinary income.
One thing must be noted that the profit or loss incurred by the sale of a collectible item on which tax will be imposed is the net value and not the gross gain/loss.
That is, to calculate the taxable income, one has to deduct all the cost basis, including storage costs, trustee costs, custodian fees, etc., from the sale proceeds. The remaining amount will be taxed.
Can I Store My Gold IRA at Home?
No, a resounding NO! You cannot store IRA gold at home under any circumstances.
During the last decade, the density of misleading advertisements publicizing home storage as a legal way to hold IRA gold by gold dealers has skyrocketed significantly.
The inundation of such ads has created quite a stir as gullible buyers end up trusting the presented claims and make illegal choices.
The Internal Revenue Code is unmistakably clear on the issue and stringently prohibits storing IRA gold at home. Section 403 of the bill states, ’IRS approved bullion must be held in the “physical possession” of a financial institution or an IRS-approved nonbank custodian, such as a depository.’
Furthermore, in 2018, the Industry Council of Tangible Assets also issued a white paper on the issue, supporting the IRS’s stance on the subject. The report stated that
IRA owned precious metal assets must be held in the “physical possession” of U.S. financial institution or an IRS-approved nonbank custodian, and not at home or in one owns physical possession.
If someone wants to invest in a gold IRA, they have to contract with an IRS approved nonbank keeper, also known as a U.S. financial institution, to physically hold the asset.
If an investor tries to breach the law and keeps their IRA gold at home, they will face serious legal consequences, such as penalties or taxes or fees on the entire IRA, in case of an IRS audit.
How Much Gold Should You Have In Your Portfolio?
Gold is often touted as alternative investments because they cannot be transacted on public forums and require experts for proper evaluation. Having gold in your investment portfolio is certainly an excellent way to diversify your assets, but how much gold is enough to do that?
The honey-hued metal is a financial constant in the sense that it rarely depreciates and maintains its value when the economy is unstable.
Whenever there is geographical unrest or a possible way of recession in sight, inflation takes over the financial landscape, reducing the value of paper money. In those times, gold prices tend to soar, providing financial security to its bearers.
But gold doesn’t offer a steady income; it only promises a hefty return (that too after being taxed). Therefore, investing all your money or a significant portion of it on the yellow precious metal is not a reasonable call.
Moreover, putting all your eggs in one basket (an asset basket in this case) is never a wise decision. And the point of adding gold to an investment portfolio is to diversify it, not monopolize it, which is why having too much will be counterproductive.
So how much gold should you have? While financial experts differ on the exact percentage of gold, they do agree that having more than 20% of gold is not prudent.
As per the former hedge fund manager and the host of the famous television show Mad Money, Jim Cramer believes that only 10% of an investor’s portfolio should be gold, and the rest should be other forms of assets.
Talking to CBC, the financial expert said that gold or any other precious metal for that matter shouldn’t even make 20% of an investor’s portfolio as ‘that’s too much.’
Now, whether you keep 5% or 10% of your portfolio as gold bullions, it’s up to you, but be sure not to exceed the 10% limit.
In sum, gold is an ideal hedge for when times are rough, and you need insurance, but that’s it; other than that, there isn’t much that one can do with physical gold.
Therefore, an investor should consult a financial advisor to decide on how much of their reserves they should spend on the precious metal based on their portfolio’s overall financial goals.
The world of investment stands divided over its stance on investing in physical gold. While some experts believe that it’s a smart move in unstable economies, others remain adamant that it is a bad choice.
According to Warren Buffet, the American business tycoon and the CEO of Berkshire Hathaway, investing in gold is like having a goose that just sits in one place, eats insurance, and does nothing, whereas stocks are like gooses that keep laying eggs.
Hence, investing in equity is a lot better as it brings dividends and ownership rights to a company.
However, at the end of the day, the decision to purchase the yellow metal boils down to an investor’s preference and appetite for risk.
If a person’s portfolio has the time and financial capacity to bear the weight of an asset that will give returns in a while, then investing in gold bullions as a hedge is not so bad as long as the volume of the investment isn’t more than 5-10%.
Besides, if you need to save your hard-earned money from depreciating, then you should contain at least some of it in real gold. Doing so will keep your money from devaluing and provide you a hedge when times are tough.
So, if you are interested in opening a gold IRA and owning hard gold, then each gold IRA review in this guide will help you make the right investment choice that is suitable for your portfolio.