When it comes to opening and individual retirement account (IRA), the first thing that comes into most people’s mind is bonds, stocks and mutual funds. However, with the uncertain state of the economy all over the world, most investors are looking for other IRA investments options. Take gold for instance. To most people, gold is an unlikely investment option. However, when you look back in history, gold perpetually rises in worth whenever there is a fluctuation in the economy. This happens when the “sharks” in the investment world opt for safer options. Gold is a great investment in many ways. For starters, gold does not seize in value, no matter the state of the economy. Experts compare gold investment to allowing your money to earn interest in a bank. Here are some of the factors that make gold IRA investment a great idea.
What is A Gold IRA
Gold IRA refers to an individual retirement account which is opened to store gold and other precious metals. This account works the same way as a regular IRA, only that gold bars and bullion coins are stored, instead of paper assets. Also, unlike regular IRA, gold does not allow one to collect interest when they finally retire at the age of 70. This is one of the reasons why most people do not consider this investment option. Others are simply not aware of the benefits of opening such an account. While it is not possible for people to collect interest from this type of retirement account, the long term benefits are far more attractive. Between the years 2004 and 2014, gold has experienced a steady increase in worth, compared to the dollar.
There are many different factors that make gold appreciate in value as time goes by. For starters, there is not enough supply of this precious commodity to satisfy the demand. When supply is low, the price goes up. There are not enough gold deposits left in the world to affect the price of gold in a negative way. Statistics show that depreciation in value of gold over the past few years was minimal and hardly made a difference.
A Strong Case for Gold Investment
Financial experts and other investors predict that the price of gold will rise in the next few years. Some claim that it could go as high as $10,000 an ounce. While these predictions are not certain, one thing is for sure — with the rising number of people investing in gold; its price will definitely go higher than it currently is. The cost of gold rises based on events that lower the value of bonds and stocks.
Preparing for Tough Times
The number of people buying gold seems to increase as time goes by. For this reason, it would be wise to store it in an IRA, which will secure it for the future. Traditional retirement plans have had their fair share of downfalls, as seen in the past couple of years. Those who took the chance and invested in gold are smiling all the way to the bank. This is not to say that the ship has sailed. According to most financial analysts, this is a great time for investing in gold and secure your future. Investing in stocks and bonds is a risky venture in many ways. The dollar seems to depreciate in value as each year goes by and the future is not certain. The recession took its tool on many people who were not prepared for it. An investment with irrelevant or no risk such as gold can protect your future and that of your family.
You Can Use your IRA to Buy Gold
Not everyone has enough money stashed away somewhere that they can use to buy gold. Luckily, you are now able to use your retirement money for investing gold. After careful consideration, most people have realized the benefits of gold investment and are using their retirement money to invest in gold. This is a fairly easy process that doesn’t take a lot of time or effort.
Self-directed IRA Investment
The current 401k does not allow you to own physical precious metal. For this reason, you will have no choice but to roll over your gold investment into self-directed gold IRA. This account does not limit you to precious metals when it comes to investing. You will also be putting yourself in a position to enjoy tax benefits associated with such a retirement account.
The dollar has declined in value and the future does not look bright for most investors. The Federal Reserve is engaging in unlimited money printing known as Quantitative Easing 3 (QE3). This has led to rapid decline of the dollar making it a doubtful retirement investment plan. Investing gold gives you peace of mind by removing all doubt.