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Do you want to transfer some or all of the money in your 401(k) into a gold IRA? People do it every day without a hitch, but it's essential to follow the proper steps to avoid getting penalized by the IRS. Making a correct transfer of funds is not rocket science, but if you work with a reputable gold IRA firm, the process is much easier, safer, and totally streamlined.
What's the best way to get a handle on how to begin? First, anyone who currently has a 401(k) and wants to park a portion of the funds in a self-directed IRA (SDIRA) needs to review the standard steps, as noted below. The other crucial component of the process, which is included in the steps, is to evaluate the gold IRA firms and choose which one best suits your needs.
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Benefits of Gold IRAs
It's important to know the main reasons that so many working people, retirees, and people of all ages elect to put at least a portion of their retirement money into a gold IRA. While there are dozens of complex motives, the most common ones include the potential tax benefits, the fact that gold is the perfect long-term asset for retirement accounts, and that gold IRAs are the "self-directed" type, which means you make every decision about the account.
Tax Benefits, Potential Earnings, & Control
In other words, gold IRAs offer excellent tax benefits, have a massive upside profit potential, and put you in full control of your retirement money. And, even if you don't want to transfer the entire amount in a 401(k), it's still possible to achieve a high amount of portfolio diversification by putting a portion of the funds into a gold retirement account.
Asset Choices
Note that 401(k)'s, set up and run by employers, typically offer very few asset choices. The normal menu usually includes low-interest asset classes like mutual funds and a very limited number of ETFs and government securities.
Workers who want a chance to earn a potentially better return and take a bit more risk routinely choose to transfer all or some of their 410(k) money to a traditional or Roth IRA or to a self-directed gold IRA. Also, remember that people who open gold IRAs can choose the Roth (using after-tax income) version if they wish.
Pro Tip: Yes, you can have two retirement accounts at the same time, a 401(k) and a gold or self-directed IRA. It's a common arrangement. In fact, many people who have employer-sponsored 401(k)'s choose to put some of their retirement money into tax-deferred IRAs or Roth IRAs. Roth contributions are made with after-tax income, and future withdrawals are tax-free.
Review the steps and the companies in the following two sections. After that, you should be ready to make a decision about how to get the entire process underway.
Steps for Rolling over 401(k) to Gold IRA
Top 3 Companies for 401k-to-Gold IRA Rollovers
There are numerous gold IRA companies, but our research uncovered the top three. The following are all excellent choices for people who want to roll over some or all of the funds in a 401(k) and move the money to a gold IRA.
Augusta Precious Metals (WINNER)
Augusta specializes in helping people who are close to retirement age or past it diversify their portfolios by adding precious metals to the mix, particularly silver and gold. Not only does APM have a stellar reputation among customers and within the industry, but the company is also one of the few that offers extensive educational resources regarding fees, how to avoid investment mistakes, economic trends, gold IRAs, and more. Augusta is also at the cutting edge of IRA precious metals investing by selling metals directly to buyers, retirees, and investors.
What investors need to know about APM:
#2. Goldco
Not only does Goldco, officially known as Goldco Precious Metals, offer a buyback guarantee for all the precious metals it sells, but the company is known for its attentive customer service. They also sell direct-buy metals for non-IRA investors. For clients who want to do rollovers from 401(k)'s or other kinds of retirement accounts, the Goldco service agents are knowledgeable and easy to work with. Founded in California in 2006, the company specializes in gold and silver IRA setups, rollovers, and IRA planning. They also offer cash sales to the public, for which there are no fees whatsoever.
What investors need to know about Goldco:
The California-based company is not only family-owned but sells all four precious metals, gold, silver, platinum, and palladium. AHG has carved out a niche in the market by selling gold-backed and other metal-based IRAs and servicing the accounts for all customers. The company offers a buyback guarantee for anyone who wants to convert any of their IRA metals into cash at any time.
The minimum on a new IRA or rollover account is just $10,000, among the lowest of the leading firms in the industry. AGH also assists clients who want to do rollovers from 401(k)'s and traditional IRAs into gold IRAs, and their agents are highly skilled at quickly setting up trustee-to-trustee style accounts or rollovers within the 60-day rule.
What investors need to know about American Hartford:
Final Verdict
While rollovers from 401(k) to gold IRAs are common, account holders who have never done a total or partial transfer of funds from one kind of retirement account to another can find the task to be rather challenging as well as a bit confusing. The simple solution to the dilemma is to vet the gold IRA companies, choose one to work with, and contact one of their representatives to help you navigate the steps for making a transfer to a gold IRA.
A gold IRA specialist knows how to cover all the bases and assure customers that they will not be penalized by the IRS for making an error. Specialists take care of all the paperwork, speak with the 401(k) administrator, and get the funds moved quickly and legally. They also help new clients choose the kind of gold, silver, platinum, or palladium to put into the account, select an IRS-approved storage vault, and deliver the bullion directly to that secure location.
