Can I Purchase Physical Precious Metals with My 401k Funds?
Investors who regularly contribute to a 401k retirement fund often wonder if they could be buying physical precious metals with their savings. Unfortunately, 401k plans that allow precious metals investments can only purchase “paper gold” in the form of ETFs or mutual funds.
To invest retirement funds directly in physical gold and silver, a self-directed IRA is necessary. This allows you to buy eligible gold and silver coins and bullion and have them physically allocated with a third-party custodian. Metals IRAs are great retirement plans, because they allow you to protect your wealth with the ultimate safe-haven assets while also enjoying the tax benefits of an IRA.
SchiffGold generally recommends metals IRAs when clients have existing IRA funds they can rollover. Otherwise, starting a new IRA with the maximum yearly contribution level of only $5,500-6,500 means that annual storage fees for your precious metals would immediately begin cutting into your retirement savings.
If you already have a 401k plan, find out if it is eligible for an “in-service rollover.” This may allow you to move a portion of the funds from your current employer’s 401k into a self-directed IRA. When you leave the company through which you earned your 401k, you also have the option of rolling your savings into an IRA.