Gold and other precious metals are considered reliable assets during economic uncertainties. This is why a lot of investors are turning to them as a way to diversify their portfolios. Precious metals are known to protect investors’ money against inflation and market volatility, and this is where they park their money in specialized individual retirement accounts.
With a self-directed IRA, the account is generally maintained by a custodian, but it will include shipping, moving the gold bars and coins into a depository, and lots of paperwork. A reputable and reliable precious metals company can help you with the process. Here are some things that you need to know about them.
What are your Options?
Competitive Pricing Schemes
Most companies have competitive pricing where they can waive the annual fees if you reach a certain investment threshold. Find out more about the fees when you visit https://www.investorscircle.net/goldco-fees/ and see if the pricing structure works for you. You can also see if there are promotions for new investors or discounted rates available. Choose the ones with investor-direct pricing for cheaper rates.
It’s worth noting that some companies have a long track record regarding precious metals. Some have been operating for over a decade and have already served many customers during that time. The ones that have five-star ratings have more fees than the ones that are just starting out.
Fortunately, companies that act as dealers can help customers avoid costs charged for purchases involving palladium, platinum, silver, and gold. Call a representative and see more about their pricing and see if they are good for you.
The fees involved might include an initial account opening of $50. The administrative fees that need to be paid annually can range from $80 to $100, depending on the account and the investment amount. The annual storage for segregated and non-segregated might vary, but the range is generally $100 to $150. The minimum is about $3500; for retirement accounts, the commitment should be $50,000 and up.
Excellent Customer Service
Some will go the extra mile to ensure that their customers are satisfied with their products and services. It will always help if you get in touch with brokers and custodians who can provide updates when needed. The best ones have extensive educational resources that can be found on their website, so you will have an idea of what you’re signing up for.
With the established companies out there, expect a more personalized service where you can talk to a specialist one-on-one, and they can guide you every step of the way. They can also give you e-books, vlog access, and an extensive library of topics related to precious metals so that you will have a guide on your investments. You can even set up an SDIRA with a representative over the phone, and they will handle everything for you.
Low Minimum Investment Required
If you’re still new to the industry, you might want to choose the ones requiring a lower investment to get a feel of the market. The service and storage costs consist of a flat fee, and one can budget their needs better when the prices are lower.
These companies are a favorite of new investors since initial consultations are often customer-centric. They base their packages according to their client’s objectives, preferences, and needs, and a trusted custodian will be assigned to them afterwards. The experts will guide their clients without needing to get into high-sales tactics. The fees might not be the lowest, but they stay competitive. These companies might also have segregated storage with a buyback service for those who want to sell their precious metals back.
Provides Guidance and Expertise
When you get in touch with the right company, know that they can provide you with their expertise and guidance regarding certain precious metals. Some don’t even charge when you decide to roll over your existing IRA into an SDIRA, which can mean additional savings.
Most of them have straightforward and transparent fee structures where they can charge $200 for storage annually. This is lower than what other firms charge, and during the application process, you can get assistance from their customer support so that everything will be a hassle-free experience.
Different Types of Fees
When it comes to setting up a Gold IRA, there are a few different types of fees that you may be charged. Here is a breakdown of the most common additional costs that you might encounter:
- Setup Fees: The initial setup is often charged by the company that will open your self-directed individual retirement account. Each provider will charge different rates, so it’s best to call and talk to them first before signing up.
- Custodian Costs: The custodian is the financial institution holding your gold IRA. They will typically charge an annual fee for their services, ranging from $100 to $500 per year.
- Acquisition Expenses: These extra expenses are associated with purchasing the precious metals that will be held in your IRA. These costs can vary depending on where you purchase bullion but typically range from 2%-5% of the total value of the gold purchased.
- Shipping and Storage: If you choose to have your metals physically shipped and stored in a depository, there will be additional costs for shipping and storage. The prices can range from $50 to $100 for every transaction you’re going to do.
Pros and Cons of Precious Metals
Investors still choose to invest in precious metals despite the additional costs. This is because having a tangible asset that holds its value against inflation and market volatility is something that can provide them peace of mind. When investing, it’s always best to consider the pros and cons and to see which options are best for them.
Pros:
- Gold is a stable investment that can protect your portfolio from inflation.
- An SDIRA allows you to diversify your holdings.
- Precious metals, real estate, and art can be self-directed, which means you have more control over your investment choices.
Cons:
- The fees can be high, and there are account management costs to consider
- You may have to pay taxes on your profits when you cash out, depending on the type of IRA you opened.
How to Avoid the Fees
There are a few ways to avoid gold IRA fees altogether. You can always choose to invest in precious metals through a company that charges no fees. Unfortunately, these companies are few and far between. Another way is to reach a certain threshold of investments where a custodian can waive the additional costs in your account. You can also see if discounted rates are available and if the company offers a promotion for new investors. See more about a gold IRA on this page here.
Final Thoughts
Gold IRA fees can be extremely expensive if you are not diligent in researching your options. Understanding the costs associated with investing in gold, such as storage and handling, shipping costs, broker commissions, and more, is important. Doing your research ahead of time will help ensure that you make the most informed decision regarding an SDIRA investment. Additionally, partnering with a reliable financial advisor or company specializing in gold IRAs can provide valuable insight into reducing those costs and maximizing returns for years to come.
