Saving for retirement is not as clear cut as funding an IRA or 401(k) plan. Most plans don’t offer the diversity you should have when saving. Your money is usually tied up in stocks, bonds, mutual funds, etc. offered by your employer-sponsored plan or your custodian. After a strong 2013, that might not be such a big deal, but the early part of this year has proven that your investments are more at risk in a volatile market. One way to diversify your portfolio is to invest in precious metals, especially gold.
Investing in precious metals, including gold, silver and platinum with an IRA works just like a traditional plan. Your investments grow tax-deferred until you start distributions during retirement. The only caveat is that you cannot personally hold the gold (or other metal) in your possession. They are held safely in an IRS-sanctioned depository and will be sent to you as soon as you reach retirement age.
As said, proper diversification is key to a successful retirement. Investing in gold is a great way to protect from the market’s roller coaster of a ride. Inflation is one a major concern of all Americans. What the dollar is worth today won’t be the same as five or ten years from now. The US government can make more money however they cannot make gold on the spot. Therefore gold usually tends to keep its value above inflation. Furthermore, since gold can be exchanged for goods or services, it is a liquid asset. These assets are crucial to have a good cash flow during retirement.
Lastly, what if you already invest in an employer-sponsored plan? You can continue to fund that plan and open up a separate self-directed IRA which you can then invest in gold with. A tax expert with the IRA Financial Group can easily set up your account and fees are much less than your 401(k). Moreover, when you leave your job, you can easily rollover your old 401(k) funds into your new self-directed IRA. Check out this article for more details about rollovers.