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What is a Gold IRA and How Can a Gold IRA Benefit Dividend Investors?

When people build investment portfolios, they are paving the way for achieving their financial goals. Investing can enable you to repay loans faster, pay for your child’s education and take care of your financial needs for retirement. In short, investing is a long term solution for securing your financial future.

In the past, people would invest in stocks, mutual funds, IRA’s, etc. Today more and more people are investing in gold IRAs.

What is a Gold IRA and How Can a Gold IRA Benefit Dividend Investors

What is a Gold IRA

A gold IRA is an IRA account that is invested in gold coins or bullion instead of stocks, mutual funds, etc. A gold IRA functions exactly like a regular IRA, except for the fact that these accounts require purchasing and storing the physical asset. Because of this, a gold IRAs requires the use of a custodian, most often a bank or brokerage firm, to manage the account.

Why Invest in a Gold IRA

People invest in gold IRAs for several reasons. First of all, gold and other precious metals are often looked at as safe assets because gold will always have value. Secondly, the value of gold tends to move in the opposite direction of paper investments such as stocks and bonds. When the stock market is doing good or rising, gold may fall. But, when the stock market falls, gold investments tend to increase.

In addition, there are some investors who believe that the U.S. dollar is quickly losing purchasing power, and that gold can provide a store of value during times of crisis.  Plus, there’s also a growing concern that inflation and debt will eventually make the dollar worthless.

How Can a Gold IRA Benefit Dividend Investors

Many people see a gold IRA as a supplement to their other retirement funds, in part because gold can be used as a stabilizer. In other words, when stocks and mutual funds are losing value, gold is usually gaining it, and vice versa. So if your other investments take a hit, your gold will increase in value to help compensate, helping to hedge your losses.

In addition, while the value of gold fluctuates, it has remained a valuable commodity for thousands of years, and it will likely continue to remain valuable for decades to come.

Before You Invest in a Gold IRA

As is true with any investment, do your research before you invest in a gold IRA. Look up and read several gold ira reviews. Read about the pros and cons of investing in a gold IRA. Look up verified reviews of companies that offering these types of retirement accounts.

Make sure that the gold ira reviews you read are not written by companies that actually own the review sites, or by people who are being paid to write a review and endorse a specific company or custodian. Some popular review sites that provide unbiased reviews include Consumer Affairs, Trustpilot, BBB, and Trustlink.

Your Next Steps

If after doing your research you decide to invest in and set up a gold IRA, there are several steps you will need to take. Generally speaking, you will first need to choose a company to work with. Look for a reputable company that specializes in gold IRAs. Make sure they can help you with every step of the process from buying the gold to helping you decide what facility you should use to store it.

Next, you will need buy the actual gold or precious metals that have been approved. The tax code actually designates specific gold, silver, and platinum coins that qualify,  as well as sets the purity standards for the gold, silver, platinum, or palladium bars that can be held in these specialized accounts.

Then you will need to have those assets transfered to your chosen depository in a manner in which the custodian can account for it.

In Conclusion

Alot is involved when it comes to investing for your financial future. Regardless of whether you opt to invest in a gold IRA or something more traditional, always do your research first. This way you can make the best investment decisions for you.

 

 

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