Gold has long been a great way to turn your cash into a growing investment. But did you know that you could save for retirement and increase your wealth by opting for gold?

A gold IRA is a fantastic option for anyone looking to diversify their retirement portfolio. But that isn’t the only reason more people are investing in gold – as a trustworthy investment choice, a gold IRA could be an excellent option for your retirement savings.

What is a Gold IRA?

A gold IRA is just like a traditional IRA, with one primary difference.

When you invest in a traditional IRA, you’re putting your money in stocks and bonds. If you invest in a gold IRA, you’re using your money to buy gold of some kind – most commonly, gold coins and bullion¹.

Simply put, a traditional IRA puts your money into the stock market. You can invest the money you’ve saved in stocks, bonds, mutual funds, and securities to grow your cash and get a return on your investment. With a gold IRA, however, you’ll turn your money into pieces of actual gold. It’s like buying physical proof for your investment, which should increase in value over time.

In addition to gold, you can also invest in a gold IRA and purchase other precious metals. Many gold IRAs include gold, silver, platinum, and palladium. The IRS² defines how pure precious metals need to be in order to qualify for a gold IRA.

A Gold IRA Gives You a Valuable Investment

Choosing a gold IRA can be a smart, valuable investment decision. Turning your retirement savings into a gold IRA offers plenty of benefits.

Most importantly, a gold IRA can supplement any other retirement funds or investments you already have. It’s a great way to diversify your investment portfolio, and it can offer an added level of financial security. The Motley Fool³ reports that gold’s value tends to act opposite to assets like stocks and bonds – so if the stock market is seeing your traditional IRA lose value, your gold IRA will gain value.

This is especially beneficial if the bulk of your retirement assets and investments take a big hit. If your investments lose a lot of value, your gold IRA can help balance out your losses with an increase in value.

Additionally, while all investments can fluctuate in value, gold is pretty steady. Gold has been incredibly valuable for decades, and that isn’t going to change in the future. While its value may decrease slightly, it’s a precious metal that will continue to see additional value – which is great news for your retirement savings.

Investing in a Gold IRA Can Be Complicated

Of course, like all investments, a gold IRA can have some drawbacks. No investment is guaranteed to increase in value, and that’s true of gold too.

Gold IRAs can also come with hefty fees. According to the Motley Fool⁴, there are commonly fees for the following when you set up a gold IRA:

  • An account setup fee.
  • Fees for transactions, like additional purchases of gold.
  • Fees for withdrawals.
  • Annual custodian fees.
  • Storage fees to keep your gold with an IRA custodian.
  • While these fees aren’t really anything out of the norm when it comes to investments, the fees tend to be higher on gold IRAs. That’s because gold IRAs aren’t very common, and companies can take a bigger percentage⁵.

Additionally, gold prices and values can be a bit unpredictable. So, experts recommend that you put no more than 10 percent of your retirement funds into a gold IRA⁶. Older adults who are close to retirement should also be wary of opening a brand-new gold IRA, if they want to minimize their risks.

How to Open a Gold IRA

Are you ready to turn your cash savings into a smart investment? If you’ve decided that a gold IRA is the perfect way to maximize your retirement savings, here’s what you need to do to get started.

Find a Custodian: You’ll want to search for an IRA custodian that offers gold IRAs. You can search online and compare your options.

Deposit Your Funds: Once you’ve found the right custodian, you’ll open a self-directed IRA and put money right into your new account. It’s just like a normal IRA – you can deposit funds from your savings or roll over an old 401(k) or IRA.

Choose a Metal Dealer: Your custodian will recommend different partners and metal dealers to help you purchase gold assets. But you can also do your own research and search for metal dealers online. Make sure you look only for metal dealers who meet IRS standards.

Once these steps are completed, you’ll be all set up. But, before you take these steps, make sure to do your research. You’ll want to research whether or not a gold IRA is the right investment for your finances. And, if so, you’ll need to search for a custodian and a metal dealer who can help you find the right products and investment moves for your growing retirement savings.