00:00 Speaker A
Gold just keeps shining, hitting new records as investors flock to the precious metal.
00:05 Speaker A
Some people buy gold coins or bars and store them at home or in a safe deposit box, but for others, gold has become a way to save for retirement through what’s known as a gold IRA.
00:13 Speaker A
Now, opening a gold IRA isn’t as simple as opening a regular one. Most major brokers, think Fidelity, Schwab or Vanguard, don’t offer them. You actually have to go through specialty providers and the rules are pretty strict.
00:23 Speaker A
The gold or even other metals like silver, platinum or palladium, has to meet certain purity standards, come from approved refiners and be stored in an IRS approved facility.
00:35 Speaker A
Then there are the costs. Gold IRAs typically charge more than traditional IRAs, including setup, storage, and maintenance fees, plus insurance and shipping costs.
00:46 Speaker A
And unlike cash or stocks, physical gold doesn’t pay interest or dividends, so you’re not earning income while you hold it.
00:54 Speaker A
Taxes are also different. The IRS treats gold as a collectible, which means long-term capital gains can be taxed at up to 28%. That’s higher than the 0 to 20% range for stocks.
01:05 Speaker A
Still, gold IRAs do share some traits with traditional ones. You can fund them with pre-tax money and Roth gold IRAs allow after tax contributions.
01:14 Speaker A
But just like other retirement accounts, you’ll face required minimum distributions starting at age 73.
01:21 Speaker A
And if you want gold exposure without the hassle of storing bars, there is an easier option. Physically backed gold ETFs. You’ll pay a small fund fee, but no storage or insurance costs.
01:31 Speaker A
You can even hold gold ETF shares inside of a regular IRA. This gets you many of the same tax benefits without opening a separate account.
