This is a collaborative post by Alice Johnson about Gold IRA.
There is a lot of planning that needs to go into planning for your financial future. It is important to account for your immediate needs such as housing and insurance, but also to plan towards the future. One of the areas that should constantly be on your mind is retirement. You want to be comfortable so that you can really enjoy your golden years. You also do not want to be a burden on your loved ones. For this to happen, you want to be looking at various vehicles that are available to you when it comes to saving for retirement. Your IRA is one such way, as is gold. You will want to combine the two within your investment portfolio. Here are the five main benefits of holding onto gold in your IRA.
Benefits of Gold IRA
It Diversifies Your Portfolio
You have probably heard many times before that it is important to not put all of your eggs into one basket. This is a cliche commonly used to refer to your investment portfolio. Diversification is key. If you want your money to grow, you need to put it into multiple vehicles over time. This is a way of ensuring that you are protected if one particular investment falters in a big way at some point in the future. Putting physical gold in an IRA is an excellent way to achieve the type of diversification that can provide you with a nice retirement.
It Provides You With Insurance
When you have physical gold in your portfolio, it is similar to having an insurance policy that is in effect for your retirement. Since gold was first uncovered as a precious metal, it has always held some type of monetary value. In short, it is worth something. You cannot say the same thing for paper assets that you might hold, such as bonds and stock. In fact, even cash depreciates over time. However, gold holds steady and continues to increase. Gold has never been without value. It will always be worth something, which makes it a great addition to your overall retirement portfolio.
You Have the Control
You likely do not control many of the retirement investments that you currently hold. Just think about a mutual fund as a primary example. This is controlled by a fund manager who determines which stocks and bonds the fund will purchase. If you really want control over your money, then you must look for self-directed investments. Gold is one such way to accomplish this. You remain in complete control over the asset. You will no longer be dependent on the decisions made by another individual. When you hold gold for the long term, you are in complete control over its use. This means that you can just watch its value and then you determine when, or if, you will sell it.
There Is Tremendous Growth Potential
You obviously want all of your investments to grow over time. Some are more apt to do this than others, and a perfect example is gold. Many types of investments are tied specifically to the economy and the growth potential of one particular industry. Various factors can cause investments of these sorts to either increase or decrease over time. Gold does not generally follow the same rules. In fact, gold tends to perform better when the economy is facing tough times. This is largely because people tend to look towards gold as a safety wedge to fall back upon during times of economic turbulence. One recent study revealed that gold, on average, outperforms government bonds by nearly eight percent. That is certainly going to make your retirement look a bit brighter.
You Reap A Number Of Tax Advantages
Another top benefit of putting gold into your IRA involves the tax advantages that you will reap. In most cases, you will get the same tax benefits with a self-directed gold portfolio IRA as you would with a conventional IRA. Certain tax brackets will allow you to claim the value of your gold IRA contributions as a tax deduction. This amounts to huge savings over time. As gold increases in value, you will not be taxed until you actually cash some of it in for cash. Those distributions are then only taxed at the marginal rate. This increases the after tax return on your investment in comparison to other items that may be in your portfolio.
These benefits should give you cause to examine your retirement investments and find a way to include gold in your IRA. It is important to have money saved in various ways while making use of the programs that are offered to you. The IRA continues to be one of the most advantageous options available to you when it comes to saving for retirement. Add gold into the mix and you have a winning combination.