The economy is in an unfortunate place right now. Inflation is rising all over the United States and we are even experiencing shortages due to shipping problems. The price of gas and groceries have risen by more than 30% over the past year. And the financial pain doesn’t seem to be slowing down anytime soon.
The US feels like it’s on the verge of collapse. As an investor, you’re likely trying to prepare for the next stock market crash. And with the US dollar being so weak, it’s time to start investing in gold and other precious metals.
Still unconvinced that a gold IRA plan is the right move to make on your retirement investing journey? Keep reading to discover the biggest benefits of a gold IRA plan below.
Gold IRA Plan Retirement Benefit #1: Gold Is a Highly Liquid Asset
One of the biggest benefits of investing in gold is that it’s a highly liquid asset. What does this mean for investors? Ultimately, it means that you can easily buy and sell physical gold and other precious metals.
You’ll never have a problem finding a buyer. And you’ll never have a problem finding a seller, which means it’s highly liquid.
It’s a much better asset to purchase when compared to other investing styles. Other investments that aren’t very liquid at all include:
- baseball cards
- vintage cars
- real estate
- stamps
Let’s say you need to get access to some extra money in a pinch. Which asset is easier to sell? A typical gold coin or an expensive collectible stamp?
As you’ve undoubtedly surmised, there are literally millions of investors buying gold, silver, platinum, and palladium every day. But there aren’t too many stamp collectors. So, you’ll have a tough time selling your stamp fast in an effort to raise cash.
Gold IRA Plan Retirement Benefit #2: Gold Acts As a Hedge against Inflation
Inflation is running rampant right now as I mentioned earlier. Things like gasoline, groceries, electronics, and other goods and services are 30% more expensive this year than last year.
Do you know why they are more expensive? They cost more because of inflation. This money gobbling monster makes the value of your dollars worth less than they previously were.
Gold tends to go up in value as the US dollar weakens. These two investments travel in inverse parallels. When the value of the dollar drops, the value of gold tends to rise.
I don’t know about you, but I tend to keep timing in mind as I make an investment. And the time is right to buy gold since the value of the US dollar has dropped precipitously in the past year.
Gold IRA Plan Retirement Benefit #3: Gold IRA Accounts Provide Tremendous Tax Benefits to Investors
The beautiful thing about gold IRA retirement plans is they have a built-in IRS tax loophole in place. Yes, I’m not making this up and I’m being very serious with you right now.
As an IRA account holder, you have access to two specific tax loopholes that you can make the most of. These loopholes are so powerful because they help investors use more of their money to grow wealth for retirement.
Gold IRA account holders can invest in the following ways:
- Open a tax-deferred investment account
- Open a tax-free investment account
What is the difference between the two options?
By opening a traditional self-directed IRA account, you can invest in gold and other precious metals with tax-deferred money. This means the money comes directly from your paycheck and it isn’t taxed before reaching your IRA retirement account.
Why is this beneficial? Instead of paying your average tax rate before receiving your paycheck, the money is kept in your retirement account. You do not have to pay taxes on these investments as income. It isn’t required until you take distributions at 59 ½ years old or older.
By opening a Roth self-directed IRA account, you can fund this account using post tax dollars. This means everything earned through this account is yours to keep. Why? You already paid taxes on the money used to fund this account. The IRS isn’t going to require a different tax payment a second time on the same income.
As a future retiree, you can undoubtedly see the power in this investment vehicle no matter which path you choose. You’ll either have a lot more money on hand to grow your wealth faster in a traditional gold IRA account. Or you’ll get to keep the entire proceeds of your Roth gold IRA account, which is huge as well.
Gold IRA Plan Retirement Benefit #4: Gold’s Price Is Trending Positively Year-Over-Year
Besides the amazing tax benefits and other reasons to invest in this commodity, it’s also trending positively year-over-year.
How so? Well, you may not know this, but the price of gold on average has risen by 10% year-over-year since 1971.
It’s incredibly difficult to find an investment that pays 10% per year consistently. But that’s exactly what you get as a gold investor over the past 50 years.
This may sound crazy, but you would have become a millionaire if you invested $10,000 in gold in 1971. Without adding any more money to the pot, your gold investment would be worth $1,173,982.53 right now. That’s the power of compounding interest at 10% over a period of 50 years.
I don’t how you feel about all this, but this is exactly the type of investment that I like to sink my money into.
Bottom Line
Today, I shared four incredible benefits of investing in a gold IRA account. Oddly enough, there are many other benefits to enjoy as well. I just didn’t have enough time to get to them all right now.
Please understand that a gold IRA account is a powerful investing vehicle. And it’s a great way to hedge your bets against inflation, harsh economic environments, and other traditional investing pitfalls.
Are you ready to begin investing in precious metals soon? I highly recommend initiating a gold IRA rollover to begin your investing journey. The tax shelter alone is more than worth it my friend.
