Gold IRA vs Gold 401K vs Gold ETFs
Essentially these are three of the hottest gold investments people look up as far as gold investments are concerned so we may as well make a comparison. There are many people just like you wondering the difference between a Gold IRA, 401K and ETF. So I’ll do my best to explain what distinguishes them apart.
The first thing we need to get out of the way is that in this comparison is that one of the contestants doesn’t necessarily exist, within this context.
And that contestant is the gold 401(k). There’s no such thing as a gold 401(k) account and the only way you can actually own physical gold as an investment is in a gold IRA account.
So we can eliminate the gold 401(k) as the first loser because it doesn’t actually exist. So technically it’s not a loser. It’s just a phantom so that’s kind of funny and now we have that out of the way.
What people find out is that there are ways to use their 401k funds as a means to invest in gold. Generally during a leave of employment, which more and more people are concerned about these days, you can rollover your 401k into a gold IRA, or a portion of it, if you’d like to diversify into some gold investments including physical gold bullion.
An ETF is called an exchange traded fund, and they trade on the stock market just like any other stock but they actually represent a larger portion of the gold market, like a mutual fund represents a larger basket of stocks. The only difference with a gold ETF is that this type of fund normally trades at two or three times its value so there is a lot of volatility.
It’s also a highly leveraged investment which could be kind of scary to a lot of people. I don’t normally recommend it to those individuals that aren’t comfortable investing on their own.
You will want either some familiarity with the market or a trusted adviser to look over this for you, or else you stand to be taking a nice risk. There are different methods in which gold ETFs perform, and the price of gold is merely one of them and does not account for all ETFs, only a portion.
One nice thing you have the option of is that you can invest in gold ETFs through an individual retirement account.
Gold IRA account.
This is the ideal way to buy physical gold because you can hold it as part of your retirement and when it comes time to sell at some point in the future you will be able to fully capitalize and never have to pay any taxes on it because the IRA acts as a tax shelter.
You may want to look into a self-directed IRA that allows physical precious metals, as you will have full control over where your investments are placed, rather than a fund manager making those decisions for you. This is what you will have to use as a means for investing physical gold if that is your aim.
You can decide between several types of an IRA such as a Traditional or a Roth. A gold Roth IRA works well for some who want to double up on their benefits with both the Roth IRA and physical precious metals. Which it should be noted that so far as precious metals are concerned, you have more options than just gold in this type of IRA. Platinum, silver and palladium bullion are also allowed.
You won’t be able to touch the money until you retire though, so that is the potential drawback. If you’re ready to start investing in gold then you can put your contact information into the form on this page.
One of the Regal Assets representatives will contact you to help you with any questions you may have and they’ll also send you a free investors kit. This gold investing kit is fantastic and a serious eye opener if you are still in the learning phases, and it’s FREE!