Pros and Cons of a Gold IRA

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Contributor, Benzinga
November 18, 2022

Retirement planning focuses on building a foundation for a long and happy retirement. An essential part of a retirement investing plan is to ensure a balance between risk and return. Physical assets like precious metals diversify your portfolio and can help to protect against losses in other assets, like the stock market.   

A Gold Individual Retirement Account (IRA) is a self-directed IRA (SDIRA) where you have more control over your retirement investing. The Internal Revenue Service (IRS) has given several precious metal coins and bullion its stamp of approval for IRA investment. You can even do a gold IRA rollover and move existing IRA investments into precious metals.

Pros and Cons of a Gold IRA

Like all investments, gold IRAs have advantages and disadvantages. Here are pros and cons of gold IRAs. 


  • An inflation hedge: Investors use gold as a hedge against inflation. Though gold does not always perform well as an inflation hedge, this precious metal is used in many industries and has been a valued commodity for thousands of years. 
  • Portfolio diversification: Gold assets can move in different directions from traditional assets. As a result, gold provides investors with diversity in their retirement planning portfolios, possibly counteracting the price risks of stocks and bonds. 
  • Store of value: Central banks control the value of currencies by managing the supply. They can print money and flood the market with fiat, creating inflationary pressures. Gold is relatively rare and can retain value across international borders.
  • Access: You can access more alternative investments with a self-directed gold IRA account than in Traditional IRAs. 
  • Tax-protected assets: A gold IRA allows you to save on tax now or in the future. 


  • Higher fees: Traditional IRAs cost less to set up. Fees may include the cost of initiating the gold IRA, annual maintenance and storage fees, insurance, custodial fees, brokerage fees and purchase and cash-out fees. 
  • Administrative Requirements: Setting up a gold IRA isn’t that difficult, but the admin requirements can get confusing. Still, it’s easy to find all the help you need from a gold IRA providers who can assist with gold buying. They will aid with organizing a depository and finding a custodian for your assets. Some gold IRA providers also publish educational materials to assist investors with retirement planning decisions.
  • Risk of loss: Physical assets carry the risk of theft or damage. Investors need to choose their custodians wisely to protect against such losses.
  • Volatile assets: Gold prices often experience significant price swings. Price movements can lead to heavy losses if investors sell at the wrong time.

What is a Gold IRA?

A gold IRA holds precious metals like gold, platinum or palladium, rather than more traditional assets such as stocks and bonds. Because a gold IRA is an SDIRA, you invest in more types of alternative investments like metals.  

Investors wanting to set up a gold IRA will need a broker to buy the precious metals and an IRS-approved custodian and depository to hold and store the assets. Gold IRA companies can advise and assist with the setup and a gold IRA rollover of an existing IRA. A gold IRA rollover incurs no taxes if the change is completed within 60 days of leaving your previous defined-contribution fund. 

Best Gold IRA Companies

Gold IRAs are popular retirement planning tools. The industry has several reputable businesses that specialize in gold IRA services. Benzinga discusses some of the best companies here.

Advantage Gold

Advantage Gold sells precious metals to investors looking to maximize their retirement investment. When you buy precious metals from Advantage Gold, you can make your own investment choices or seek the advice of the professional staff. 

Advantage Gold prides itself on its customer service, and you’ll be pleasantly surprised by the professional and friendly advice. You can arrange delivery of your coins or bullion or put your assets into retirement funding as part of your diversified retirement planning portfolio. Advantage Gold provides investors with loads of educational resources to help investors make the best investment decisions. It offers a range of IRS-approved precious metal assets. 

Augusta Precious Metals

Full-service precious metals dealer Augusta Precious Metals is one of the biggest gold and silver dealers in the U.S. When you invest in Augusta Precious Metals, you can send your assets to one of several depositories. The company will ship your coins and bullion into storage free of charge. Augusta Precious Metals offers investors a range of IRS-approved precious metal products.

Every new customer is assigned an account manager. You can manage your own portfolio or find support from trained financial consultants or precious metals experts employed by the company. The website also contains plenty of educational material to help you make the right investment choices. 

American Hartford Gold

American Harford Gold offers investors a choice of gold and silver coins. The company will also help you to set up a silver or gold IRA as part of your retirement planning. If you have an IRA of $10,000 or more, American Hartford offers a free IRA rollover into a gold IRA. The company charges no additional IRA fees, but you will pay the SDIRA company. You may also meet the criteria for three years of free storage or $15,000 of silver coins. American Hartford Gold offers investors a buyback guarantee ensuring easy access to funds when needed. 

Lear Capital

Lear Capital provides investors with a wide choice of precious metals assets, including international-grade bullion, gold coins and gold IRAs. Lear Capital offers investors discounts for larger investments by waiving first-year storage fees for a $25,000 investment and second-year fees if you double that investment. Lear Capital investment advisors are happy to offer advice and information on the available investment products. Lear Capital charges no fees for setting up a gold IRA. 

Red Rock Secured

If you’re worried about gold price volatility, Red Rock Secured has you covered. The company provides price protection for seven days. It will also deliver your gold to the depository free of charge. Up to 90% of Red Rock Secured investors qualify for a lifetime of fee-free storage of their assets. 

You can make your own investment decisions or arrange individual retirement planning advice from a qualified investment advisor. The company has a range of gold and silver products from which you can choose. Red Rock Secured asks for a minimum investment of $1,500. 

Frequently Asked Questions


How does a gold-backed IRA work?


A gold-backed IRA works like a Traditional IRA for tax and contribution purposes, but you can purchase more alternative investments like precious metals than in a Traditional lRA. 


Do you pay tax on a Gold IRA?


You will pay tax on agold IRA one way or another. You can opt for a Traditional IRA or a Roth IRA. With a Roth IRA, you receive no immediate tax benefits because you invest with after-tax funds. If you opt for a Traditional IRA, you qualify for tax deductions when you contribute to the fund. You’ll pay tax on your retirement withdrawals.