Five Simple Steps for Setting up a Gold IRA

January 17, 2012

BY: Robert Hallberg, Topics: Gold IRA

Many good folks may not be aware that you can setup a gold IRA and allocate your retirement money in physical gold and silver. Gold and silver has outperformed almost any traditional investment over the past decade by leaps and bounds, but getting a gold IRA is more than just looking for a superior investment return. A gold IRA is about protecting your hard earned retirement money from devaluation, loss and theft.

Although, it is possible to put physical gold in your retirement account most custodians do not allow customers this option for the simple reason that gold and silver are static assets that cannot be traded for commissions. However, this can be circumvented by setting up a self directed Gold IRA. Dont be surprised if your current custodian do not want you to know this.

Getting started with your gold IRA Account 5 Simple steps

I have created a guide with 5 simple steps to follow for setting up a self directed Gold IRA. You can follow these steps to create a new self directed IRA for or roll over an existing IRA or 401K into your new self directed gold IRA.

Step 1 Select a Self Directed Gold IRA Custodian

First you need to open an account with an IRS approved self directed IRA custodian. This is no different than opening an account with a bank or a brokerage firm. All you need to show is ID, proof address, etc. There are many companies that offer this service so make sure you find a reputable one that fits all your needs. I have provided a list a couple of custodians that are approved by the IRS.

American Estate & Trust, LC Phone: 702.331.7305, Vault Location: Salt Lake City, UT

Sterling Trust Phone: 800.955.3434, Vault Location: Wilmington, DE

New Direction IRA Phone: 877.742.1270, Vault Location: Wilmington, DE

Goldstar Trust Company Phone: 800.486.6888, Vault Location: Wilmington, DE

Step 2 Fund your Account

Once you have opened an account you need to fund it, and to fund your account you simply write a check to your IRA custodian with your annual contribution. If you already have a regular IRA or 401K you can roll this over into your new self directed IRA.

Step 3 Select a Precious Metal Dealer

Once your account is funded you need to select a reputable gold and silver dealer and purchase precious metals for your account. The dealer will send you an invoice when the order has been placed and you will need to authorize your custodian to fulfill payment of the invoice. Once this has been completed everything is finished on your end.

To meet the IRS requirements your precious metal bullion has to be 0.995% pure for gold and 0.999% pure for silver, although American Gold and Silver eagle coins are both accepted.

Step 4 Transfer the Metal to a Depository

Next, the trust will verify the invoice and transfer the funds for your gold and silver bullion purchase. Once cleared, the dealer will ship the metal to your custodians depository.

Step 5 Complete the Transaction

The custodian will notify you when the bullion arrives at the depository and verify that the correct amount has been received. They will give you regular statements; reporting the amount of bullion and its valuation in your account.

So why gold in your IRA? In addition to superior returns, segregated physical gold and silver offers safety from your broker going bankrupt. Just think Lehman in 2008 or the recent incident with MF Global. Your physical gold does not have a counter party you have to worry about.

Furthermore, if you have not read my previous articles about gold and silver I have made a chart showing the return of a gold IRA over the past decade. This example assumes that you start your investment with $25,000 and contribute a modest $5,000 per year. Over the last 12 years, since the beginning of the bull market, your account would have grown 1281% from $25,000 to $320,332.46.

To learn about trends and spot the next investment opportunity read the Casey Report from Casey Research. It's a monthly investment news letter that breakdown economic trends in a way that is easy to understand. They make recommendations based on economic reality and their track record is several times better than the market or any mutual fund for that matter.