An intelligent way to diversify your portfolio is to invest a small percentage of it in gold and precious metals. This way, you can reduce your overall risk during recessions and sudden market crashes. Some people decide to open a gold individual retirement account to hold gold bars and coins for the long term.
Fortunately, today, the process is more straightforward because many companies are offering these kinds of services today. However, know that not all of them are created equal, and they don’t provide the same products and services. This is where a gold ira transaction fee comparison becomes helpful. You’ll know about the various fees and costs before you dive into these kinds of investments, and you’ll have an idea of what you’re going into.
Weigh the pros and cons of a gold IRA before opening one, and it’s best if you could speak to a financial advisor to see if this is the right move at this point in your life.
How a Self-Directed Precious Metals IRA Work
Investing in a gold IRA will mean that you need to open a self-directed account. These are the accounts that will allow you to purchase other non-traditional assets like precious metals, real estate, cryptocurrency, art, and many more.
For these to be considered by the IRS, you’ll need a custodian who will keep the assets on your behalf. This might be a bank or other private financial institution where a custodian handles all the transactions, submit reports to the IRS, keep account records, and handle disbursements.
After creating an IRA account, you need to fund it by transferring funds or rollovers from any existing 401k, 457b, or 403b account. There’s an option to contribute to it directly, and the maximum is $7,000 annually. Read more about a 403b in this article.
Once the funds are ready, you’re now allowed to buy any precious metals, bars, bullion, American Gold Eagle Coins, or Canadian Silver Maple Leaf that you may want to add to the depository. The purchases are then shipped into the depository or approved storage facility, where they will stay until you decide to sell them. At any point, you’re allowed to withdraw the money, but doing so before you’re 59.5 can be subjected to a 10% fine.
Comparison of the Companies
Oxford Gold Group
The company has been operating since 2017, and they specialize in precious metals and gold. There are offers for palladium, platinum, and silver as well. The Oxford Group has received a rating of A+ from BBB and 4.9 out of 5 from Trustpilot. This is based on customer reviews in early 2021.
Customers find them to have a very educational approach to their services. There are informative articles, explainer videos, and learning centers where the investors are guided to make the right choice regarding their finances. The representatives are also beneficial when it comes to knowing more about how their accounts work.
For nearly a quarter of a century, Lear Capital has been known to serve over 70,000 customers and is still going strong today. They have ratings of 5 stars on Trustpilot and 4.9 in Better Business Bureau. The customers have various resources and educational tools that help them make better decisions. There are minimum distribution estimators, portfolio comparison calculators, price charts, and the latest news that will help you on what to buy for your portfolio.
The fees vary, and the charges on the first year are $260, but it goes down to an annual fee of $180 once you have established your account. Lear Capital has a lot of positive reviews from genuine customers and higher ratings on review platforms like BBB, which is why it stood out from other companies.
Patriot Gold Group
The company has over 50 years of experience in the industry, and if you open an account worth $100,000 with them, there are no maintenance fees to pay. You’ll be able to work with the experts and experienced professionals in the industry and a company that has a rating of A+ in the Better Business Bureau.
A primary selling point of the company includes never working for the retail but directly with the owners themselves. They’ll be able to give you their expertise and knowledge about gold and other precious metals, and you’ll learn more about these asset classes during your free time because of their educational resources.
Representatives from Patriot are helpful and informative. They can provide the answers that they need for their questions. According to one representative of the company, there are unique free structures that Patriot offers, and this is something that others don’t. For an investment that’s less than $50,000, know that the annual fee is $180. For those accounts with over $100,000, there will be no annual fees involved.
This is a more balanced fee structure, primarily if you’re investing in gold for the long term. You can focus more on your investments since the fees are limited, and you don’t have to pay additional ones if you have a significant amount on your account.
Goldco has been in the business for over a decade, and it focuses primarily on gold and silver IRAs. You also can buy gold bars and coins with them, and the company has a high rating on Trustpilot and BBB.
It has an extensive collection of books, explainer videos, blogs, articles, and other educational resources that will help you get started. There are price charts, newsletters, frequently asked questions, and eBooks that will let you know which assets have performed well in the past and which ones are good choices when it comes to your retirement account.
The representatives will spend time with you answering their questions, and others may even have a promotional offer for you. The accounts should have a minimum balance of $25,000 if you want to start opening an account. Goldco has stood out in various categories, and they help answer any questions you may have with the company and the investments.