How Much Physical Gold Should You Own in Your IRA?
Updated: Nov 19, 2019
Everyone talks about diversifying their portfolios. You've probably heard all about CD's, insurance, IRAs, Roth IRAs, and everything else under the sun. While making sure your money is spread out across different financial vehicles is important, are you putting your hard-earned dollars in the right places?
So what about gold?
So without wasting anymore of your precious time, let's dive right in, and take a look at how gold can be a valuable asset to your financial future and determine how much you should own.
Believe it or not, gold is one of the best things you can invest your money in. if you're wondering if you should own any gold in your portfolio, you're definitely in the right place. The recommended amount is anywhere between 10 and 15 percent of your portfolio, and we'll be showing you exactly why this is a crucial practice.
Why is 10-15 percent the recommended amount?
While it might be tempting to buy up as much physical gold as you can, you might not want to jump the gun. Remember that 10-15 percent number we showed you earlier? There is definitely a reason it's the recommended value, and we'll show you exactly why.
Now, this does come down to your risk tolerance, but at least 10% is a good idea if you really want to play it safe. If you want to go on the extremely conservative side, you can always opt for the recommended minimum of 5%. At the end of the day, investing in gold is great for the same reason as any other investment.
Think about it in terms of buckets of money. If you have 20% in savings, and 80% in IRAs, only 20% of your assets are actually liquid. In any case, gold aside, it can be helpful to split your money up into more buckets than just two or even three. This will limit market risk, and if one area of your portfolio underperforms, not all of your assets will suffer. Therefore, allocating 10-15% of your assets into gold can be a great idea to keep things truly diverse.
Plus, believe it or not, as long as you can sell it gold is relatively liquid. You won't be exposed to the 59 age requirements, and there are no penalties. With gold, if you need some cash quick, you'll be able to do so without receiving massive penalties. Also, you'll beat inflation as mentioned before, so you'll never have to worry on losing buying power overtime.
Not bad for gold right?
Is 10-15% in a Gold IRA a good idea?
You've probably heard of Roth IRAs, 401ks, and other IRA vehicles, but are you familiar with a gold based IRA? Well, believe it or not, a gold IRA can be a great investment and lead to safety within your retirement based assets. Let's take a look at how and why this is the case.
A gold IRA is a good idea, because it can help you achieve that recommended 10-15% amount we discussed earlier. A gold IRA can also perform well even if the market is down, which can help make sure you're never under the thumb of the market at all times. While the level of growth is traditionally lower, it can be a bit safer in the long run. Gold will always be viewed as valuable, no matter what the value is at the present.
Investing is sort of like gambling against the market, but in an educated way. You don't want to have all your chips in one place, and gold is definitely a great thing to bet on. If you look at gold historically, quite literally since the dawn of time, it's been valuable. With that being said, it's definitely safe to say it will be valuable in the years to come.
Gold IRAs may not rely on dividends like some other investments, but they're definitely tax efficient. Taxes now, are historically low despite popular uproar, so in the coming decades they're bound to go back up. Having a tax efficient asset can be a great way to combat this, especially when nobody knows where taxes will be in the next 20-30 years.
Therefore, while a gold IRA might not grow as much as a traditional Roth IRA or 401k, it can provide your portfolio with stability and proper risk management.
It all comes down to diversity
When it comes to investing in your future, you need to make sure you have plenty of diversity. The market is something that fluctuates quite a bit, so making sure you have safeguards in place can help you reach your financial goals effectively.
While it's great to have an array of different financial vehicles invested in the market or against interest rates, adding gold can be a wildcard that helps you greatly. This is due to the fact that it's based on its own value, and doesn't fluctuate the same way interest rates or the market does. When it comes to diversity in your portfolio, that's the best you can get.
When you diversify your portfolio, you want to make sure you have real diversity. You want multiple vehicles growing in different ways. Think about it like putting all of your eggs in one basket. At the end of the day, the more baskets, the better off you'll be in the long run.
When it comes to gold, sure it's shiny and looks nice, but it has a whole lot more than just appeal. Gold can be a great asset that helps you beat inflation, secure your retirement, and live comfortably. At the end of the day, if you want real diversity, you should definitely consider adding gold to your portfolio.
While it should never be your primary vehicle, depending on your risk tolerance, 10-15% of your wealth invested in gold is a great idea.
So if you were wondering why you should invest in gold, or consider a gold IRA, hopefully this helped clear things up for you. Gold can do a whole lot for you, and doesn't just have to be reserved for the elite either.
Now that you know the facts about gold, ask yourself how diverse your portfolio really is.
If you decide that gold investing and portfolio diversification is a smart thing to do for your retirement and would like to learn more, please visit our website for more valuable information on the subject:
In addition to our site, we recommend visiting Regal Assets and suggest that you request a FREE no hassle gold investment kit. It is over 90 pages and is full of information you need to know. Click below on:
The Gold IRAs 101 Team