A Word Of Advice
IMPORTANT: Don’t fall for pushy salespeople that will utilize the “Bait & Switch” and will charge you a premium for “rare” gold coins…unless you are looking to lose half of your investment.
Why Did I Want to Own Physical Gold?
I love America and it pains me to continue seeing our American dollar drop in value and becoming devaluated compared to other world currencies. Our international debt is gigantic and our economy has been on the brink of breaking for many years now.
These are some of my own concerns and why owning physical gold as part of my portfolio makes much sense. Gold, even though it also goes down in value sometimes, has been proven to be one of the most consistently appreciating assets in history, is an extremely scarce asset, and thrives and skyrockets when traditional assets plummet.
When I Call Gold Companies, I Ask Them 5 Questions:
Prove To Me That You Are Experts in Rollovers
I want to make sure that the company is experienced executing rollovers from a 401K, 403 (b), 457 (b), IRA, Roth IRA, TSP, Annuity, or Pension plan, or knows how to assist in managing a Self Directed IRA, and especially, that they are very well versed in managing all tax implications.
A rollover involves them contacting my current financial institution, reporting to the IRS, handling all paperwork and payments, maximizing my tax benefit, and minimizing my risk in the transition.
In addition, a Gold IRA only allows specific coins and bullion that meet certain purity criteria, so you need an expert to know which these are. These are no tasks for rookies. When I interview gold companies, they need to give me a feeling that they are absolute experts and that they’ve done this a million times.
Where Will You Store My Gold Holdings?
With a Gold IRA, IRS rules require that you store your physical gold with a third party custodian. This custodian, however, cannot be chosen by you – it’s chosen by the Gold IRA company you decide to work with. That is exactly why I want to make sure that the storage facility, Depository, or method the company uses is the best possible one. My savings must remain safe until I decide to take them out.
I want to hear that they offer Segregated Storage. With Segregated Storage, your gold coins and bars are assured to NOT be co-mingled with other people’s assets. Meaning, your savings will be securely stored in their own isolated space in the vault, compared to non-segregated storage, where your assets are mixed with everyone else’s.
Even more important, segregated storage is usually insured for higher amounts and by more reputable entities, and is easier to liquidate. Segregated Storage is more expensive so gold companies either don’t offer it, or charge a much higher fee for it, so be sure to ask these questions.
Give Me a Complete Explanation of Your Fees and Fee Structure
I do not want any hidden fees. I want to know ALL the fees the company charges, and why, before I seal the deal with them. Some of the most common fees are setup, processing, shipping, administrative, application, storage, transfer, termination, and annual. The two most important fees to pay attention to are the annual and storage, as they are recurring.
I’m looking for an annual fee that is flat, not scaled. A scaled fee means that if my Gold IRA wealth grows, so does my annual fee. A flat fee, on the other hand, secures the same rate forever, independently from the size of my savings. I also want my storage fees to be a flat fee of under $100, or to keep them at an absolute minimum (the industry standard is 0.10% of your savings, annually).
How Long Do You Take To Process The Rollover?
The answer I want to hear is less than 48 hours. Some companies take up to 90 days to process and an extra 30 days to ship to the storage facility. This is mainly because they do not operate electronically.
Look for a gold company that has an established system of finalizing paperwork electronically, so your rollover is secured within 2 days, and shipped within 7 days. You don’t want to be stuck in a situation where your savings are up in the air for 4 months.
Do You Offer a Buy Back Program?
If the gold company does not offer a buy back program, I scratch them off my list. The reason being is that I want to ensure I’m buying liquid assets. Gold is phenomenal because it will continue to increase in value, unlike the dollar.
But if I have a medical emergency and I need money overnight, I want an exit strategy.
Look for gold companies that offer to buy back from existing clients. The best companies will offer to buy back at whatever the current price of gold is at that time, as they focus more on client retention vs. profiting at buy back.
What Company Did I Choose?
After weeks of research, I ended up choosing Goldco
I wrote 3 pages on all the reasons on why I decided to choose this particular company.
In a nutshell:
They specialize in gold IRAs, they have a non-pushy sales staff, the lowest fees, the fastest processing and shipping times, segregated storage (this is a big reason), and the best (and also the most) consumer reviews.
Why This is Not a Decision I Made Overnight
I did my homework. I called every single one of the top gold companies I was able to find. I knew I wanted gold, but rolling over your 401K or IRA is not simple (despite what sales people may say). It has a lot of implications, and if you don’t do it right, you can lose 1) a lot of money in the process and 2) a lot of recurring money every year.
Watch out for sales people. They want their commission, and it is very rare that they will look after your personal interest. With most companies, I would’ve lost around $500 the first year and an average of $2500 every recurring year, due to higher annual and storage fees. Losing that much would defeat my objective – in that case I would have probably been better off sticking it out with dollars and stocks.
The best advice I can give you is, read my reviews, but call the companies yourself. A lot of the best information is in the conversations you have with the company experts. And, if they sound shady or pushy, run for the hills.