What is a Precious Metal IRA
You’ve likely heard about retirees backing up their retirement accounts with gold and silver, but just never knew exactly how to go about it. First things first in order to put Physical gold and silver in your retirement account, you will need to establish a Self Directed IRA.
Retirees are always looking for ways to protect and diversify their retirement accounts, this is why the Self Directed IRA has become so popular. Most retirees have never heard about the Self Directed IRA or how it can benefit them.
Since this account is fairly new to most of our clients, we typically hear the same questions that come up when someone first considers opening up a Self Directed IRA.
So what we will do first, is educate you on why retirees are going with the Self Directed IRA, and how it allows you to truly diversify your
What is a Self Directed IRA?
A Self Directed IRA is a type of retirement account that puts you in full control of your investment decisions, and gives you the true ability to diversify your retirement savings with alternative investments.
One of the biggest differences when it comes to a Traditional Retirement account such as a 401K/IRA versus a Self Directed IRA, the Traditional IRA, only allows you to invest into Public Investments such as Stocks, Bonds, ETF’s, and Mutual Funds.
The Self Directed IRA not only allows you to invest into Public Investments but gives you the ability to diversify your savings with alternative investments such as:
Precious Metals (Gold and Silver)
As you can see, not only does the Self Directed IRA give you full control of your investment decisions, but it also takes your ability to diversify your retirement savings to a whole new level.
This is why we stand by the Self Directed IRA, Diversifying is known to be a smart strategy, because you want to diversify your portfolio to weather out any kind of storm.
Benefits of Diversifying
I’m sure you heard the old saying “Never keep your eggs in the same basket,” well this saying is very important when it comes to investments and retirement savings. Diversification is very important because you can’t have one plan or idea and then solely depend on that one thing.
This is one of the many reasons why our company truly loves the Self Directed IRA, because it’s the only retirement vehicle that puts you in full control and gives you the ability to diversify your hard earned savings.
According to Forbes, the Self Directed IRA is “The #1 Account All Wealthy People Have (That You Probably Don’t). Forbes also stated that “buying metals represents a safe-haven approach to diversification.”
Precious Metals are a great tool to not only diversify your portfolio, but it is also a great hedge against inflation, stock market crashes, and other economic uncertainties.
This is why investors flock to a safe haven asset like gold and silver because it protects and preserves their capital during times of uncertainty.
Precious Metals perform when the dollar doesn’t.
Gold and silver’s performance has always displayed a contrary relationship with that of Stocks, Bonds, ETF’s, Mutual Fund and Cash. As we have seen throughout U.S. history when the value of the dollar or bond goes down, precious metals have gone up.
This is why it is important to diversify your savings with precious metals such as gold and silver because it can help not only balance out your portfolio but also offset your losses.
In times of uncertainty, holding a tangible asset like precious metals is very important as opposed to a printed promise of values which adds another layer of diversification and protection to your savings.
Precious metals have always been a great hedge against inflation because they have tangible worth and have historically carried intrinsic value.
Gold and Silver Holds Long Term Value.
Throughout history precious metals have always been a great tool to diversify your portfolio and a proven hedge against inflation. Having precious metals as a part of your portfolio/savings, can provide some peace of mind knowing that your hard earned savings is diversified and safe.
Let’s look back at The dot-com bubble, also known as the tech bubble, where the stock market crashed because of excessive speculation of Internet-related companies in the late 1990s. Retiree’s during this time lost anywhere between 40-60% of their hard earned savings. During that time both gold and silver prices were on the rise, rewarding investors who had diversified their savings into precious metals.
The Financial Crisis which took place from 2007-2009. It was considered by many economists to have been the most serious financial crisis since the Great Depression. Predatory lending targeting low-income homebuyers, excessive risk-taking by global financial institutions, and the bursting of the United States housing bubble culminated in a “perfect storm”. The U.S. Stock market had one of its worst crashes in history. Retirees lost as much as 80% of their retirement savings. While the S&P 500 continued to crash, precious metals were on the rise. Prime example on how precious metals have a reverse relationship to the stock market.
As you can see, diversifying your retirement savings with precious metals during times of economic difficulty has helped countless investors protect their hard earned money. Although precious metals are known as a great hedge for various reasons, precious metals have tremendous growth potential, looking back over the past 20 years both gold and silver have gone up 450%.
What Are The Benefits Of Placing Gold and Silver In An Self Directed IRA
Diversifying your retirement savings will help protect your hard earned money against economic uncertainties.
There is tremendous demand for gold and silver as it is used in medical and industrial sectors.
Secure Your Purchasing Power
Long term holders of precious metals have seen their savings maintain their purchasing power during times of Inflation while the U.S.dollar declines.
Establishing a Self Directed IRA is easy
As long as you have an eligible retirement account, we will help you fill out simple paperwork to establish an account and help you roll your funds over to your new Self Directed IRA to back up with precious metals.
How to Open a Self Directed IRA: 5 Easy Steps
Step 1. Establish a Self Directed IRA
One of the experts at Wilshire Capital will walk you through the easy process of establishing a Self Directed IRA with our partner custodian. All it requires is simple documents that we will help you fill out, and within 24 hours you will have an account open, with an account number, online access, and a welcome pamphlet going straight to your front door which will further educate you on the Self Directed IRA.
Step 2. Funding Source- Rollover Process
Once your account is established, one of the experts at Wilshire Capital will help you fill out rollover paperwork which will move your funds from your old retirement account to your new Self Directed IRA. The whole roll over process is tax free and penalty free. There are no cost implications involved with moving your funds into the Self Directed IRA.
The following accounts that are eligible to be rolled over into a Self Directed IRA:
Eligible 401(k), 403(b), 457, TSP, and more
Step 3. Arrival of Funds – Education on Precious Metals
The whole rollover process can take anywhere from 3-10 business days depending on your custodian and type of account. Once your funds have arrived in your account, one of the experts at Wilshire Capital will give you a call to update you. The good thing is you’re not alone here. Whether you’re a professional or know very little about precious metals, one of the experts at Wilshire Capital will educate you on all precious metals and even make recommendations based on your current situation and goals. There is a lot to learn when it comes to precious metals, this is why at Wilshire Capital we pride ourselves in educating our clients on every aspect possible because we want you to feel comfortable and confident about your decision.
Step 4. Make your Purchase – Store at Depository
Once you have determined what kind of precious metals you want to hold inside of your Self Directed IRA. One of the experts at Wilshire Capital will confirm this with you before walking you through the necessary paperwork.
Once the purchase is completed, your precious metals will be sent on your behalf to a depository of your choice. You will be given a list of options on which depository you would like to store your gold and silver.
This list includes the Delaware Depository, where your metals are insured up to a billion dollars by Loyds of London. Another option available for storage is with Brink’s Global Service — the largest non-bank, non-government holder of precious metals in the world — located in New York, Los Angeles or Salt Lake City
Step 5. We are here for you
While you will not have a lot of direct contact with your Self Directed IRA custodian, they still play an integral role in managing your retirement account.
Custodians are not individuals, but rather financial institutions that are responsible for managing the storage assets in your account. The custodian also helps complete transactions, execute withdrawals, and handle paperwork. In a nutshell, they keep track of your account and ensure your assets are where they should be.
The best way for you to have peace-of-mind is to connect directly with an expert from Wilshire Capital, who will always be there to provide you with an up-to-date buy-back quote. These quotes tend to be more detailed and accurate than the statements you will receive from your custodian.
You will continue to work with the same expert who walked you through setting up your self directed IRA, and who knows your needs and retirement goals.