If you have been looking for retirement directions, you have come to the right place. Here, you will learn how to put gold in your retirement account and why gold is a good investment. For the last two millennia, gold has been used in global trade both as a store of value and medium of exchange. Since there are many disadvantages of carrying and transacting in pure gold, the currency system was developed. For every gold bar that was stored in the Federal Reserve, an equivalent in notes and coins was released into the market, in what was known as the Gold Standard. Back then, the dollar was much more reliable because it was backed by actual gold. Unfortunately, the Gold Standard was abandoned in 1971, so the money that is currently in circulation is simply not worth the paper it’s printed on.
The government can decide to print more money and devalue the dollar when it’s convenient. More money in circulation translates to inflation, meaning that tomorrow’s dollar may be worth less than today’s dollar. For this reason, it is important for investors to hedge their holdings using gold.
Gold is a limited resource. Its value is recognized all over the world. A single government cannot devalue gold, even if it is as powerful as the US government. Over the last century, the per ounce price of gold has been increasing steadily. Successful investors and emerging economies around the world have come to appreciate the benefits of having gold in their portfolio. This is what has caused the gold buying frenzy currency being experienced. China, India and Brazil have been buying gold at a terrifying rate. Prominent investors have also bought precious metals and kept them in secure storage facilities.
Since everyone is buying gold, today’s workers also need to start putting gold into their retirement accounts. Fortunately, the law was amended to make it possible for future retirees to add gold assets into their individual retirement accounts. However, a 401(k), Roth IRA or traditional IRA cannot hold these assets. Investors have to open a new gold backed IRA and rollover, or transfer, some funds from their old accounts into the new gold IRA.
Investing in gold IRA is not as difficult as some people may think. In fact, it is as simple as opening a brokerage account with your favorite stock broker. Once you set up your account, you can buy physical gold at the current market price and hold it until you retire. There are many gold IRA companies which offer custodian services, so you only need to take your time to identify the best service provider. Ideally, you should choose a company that charges the lowest custodian fees.
Many financial advisers who give retirement directions to the public will tell you that investing in a gold IRA has many benefits. Unfortunately, some of them may fail to disclose to their clients that if the custodian fees are too high, the benefits of having a gold backed IRA will be almost non-existent. It is therefore important for investors to compare all the fees that a custodian charges before opening a gold backed Individual Retirement Account with them.