The coveted, but often misunderstood “Gold 401k” has received a lot of attention in recent years, especially as more Americans look for alternative options to secure their retirement savings. But as the popularity of this unique gold-backed retirement account continues to rise, so do the questions from Americans like yourself. To help provide some clarity about Gold 401k’s, we recently spoke with Peter Reagan; a Market Strategist with Birch Gold Group, for some answers to the most frequently asked questions.
If you’re curious about the process of investing in gold for retirement, and especially with the funds from your 401k, this is interview is a must-read.
Q: What exactly is a Gold 401k?
A: The term Gold 401k is typically used to describe a 401k that has been converted into a Precious Metals IRA. The tax benefits of a Precious Metals IRA are no different from those of other IRAs, but with a Precious Metals IRA you can invest in physical gold, as well as other precious metals.
Q: So, I can’t just add gold to my 401k?
A: No, that is typically not possible, due to the limited investment options that are provided with an employer-sponsored retirement plan. Does that mean that no employer-sponsored plan could ever offer a physical gold investment option? Not necessarily, but it would be extremely rare, and I’ve yet to hear of one. The simplest way to add gold to your retirement account is to open a Gold IRA and rollover any eligible funds from your existing retirement accounts.
Q: What’s the first step to rolling over my 401k into a Precious Metals IRA?
A: The first step is contacting Birch Gold Group, because we make the entire process very simple. We’ll walk you through it, go over all your options and help you understand some potential strategies to protect your savings.
Q: How do I know if my 401k is eligible?
A: That’s one of the first things we’ll look at. In the majority of cases, the rollover is allowed if you are no longer working for the company that set up the 401k, or if you are age 59 1/2 or older. If your 401k is eligible to be moved, we’ll start the process of opening your Precious Metals IRA. I should also point out – even if your 401k isn’t eligible for a rollover, you can always choose to open a Precious Metals IRA as a supplemental account.
Q: Can I only invest in gold?
A: No – a Precious Metals IRA can also hold silver, platinum and palladium, as well as several other investment types, such as stocks, mutual funds, mortgages, real estate and so forth.
Q: What kind of paperwork is involved?
A: Some very simple forms are needed to complete the transfer of funds from your current 401k custodian to your new Precious Metals IRA custodian. Birch Gold can even assist you with this paperwork if you need help.
Q: Are there tax consequences for a 401k-to-Gold-IRA rollover?
A: Nope. As long as the funds are going between qualified retirement accounts, this is a non-taxable transaction, without any penalties.
Q: When do I choose the metals to go into my account, and how?
A: After funds have been transferred into your new account, you’ll be able to choose your metals. Birch Gold Group offers a variety of IRA-approved gold and silver, and your Precious Metals Specialist will be happy explain the differences between each one.
Q: What happens to the gold I buy? Can I keep it at home?
A: Any precious metals added to your account will be sent to an approved metals depository or vault, where it will remain safely under the management of your custodian until you begin taking distributions.
Q: When can I access my gold?
A: You can take physical possession of your gold once you begin taking qualified distributions from your IRA. If you need to take an early distribution, be sure to consult the current IRS guidelines to check for potential tax consequences.
Q: Sound great, but what if I want to do a little more research first?
A: That’s completely understandable. I recommend requesting our Free 16-Page Investment Kit. Just fill out the quick online form, and one of our Precious Metal IRA Specialists will contact you to learn more about your individual situation and goals. Then, we’ll mail you the free kit, along with additional information we’ve selected just for you, based on your specific needs.
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