Eric Sepanek
SBC Founder
Eric Sepanek is the founder of Scottsdale Bullion & Coin, established in 2011. With extensive experience in the precious metals industry, he is dedicated to educating Americans on the wealth preservation power of gold and silver.
Gold IRA investing is a popular way to diversify with precious metals. This hyper-focused retirement portfolio enables investors to tap into the benefits of physical metals while maintaining the tax advantages of conventional plans. While more investors are aware of the value behind these portfolios, many remain unsure of how to fund them.
Adding money to a newly established gold IRA is a foundational step to putting it to work for your financial plan. Exploring the main mechanisms for funding a gold IRA can help you take advantage of the plan’s advantages sooner while avoiding some of the costly pitfalls.
What is a gold IRA?
A gold individual retirement account (IRA) refers to a self-directed IRA through which investors hold physical gold. The Internal Revenue Service (IRS) permits the purchase of various physical, non-traditional assets through these accounts, but they’re commonly used specifically for gold.
Investors are only allowed to purchase IRA-eligible metals as outlined by the IRS. Generally, the metals must be in coin or bar form, produced by a government mint or accredited refiner, and meet a minimum purity of 99.5%.
Who’s involved in funding a gold IRA?
Similar to conventional retirement accounts, gold IRA investing involves a whole cast of professionals. These roles are designed to ensure a smooth, secure, and legally compliant process. The three primary roles are:
- Custodian — An IRS-approved financial institution handling the legal aspects of gold IRA investing, such as reporting assets and staying updated on required minimum distributions.
- Precious Metal Advisor — A financial advisor specializing in the gold market who guides investors in the selection, purchase, and sale of gold assets.
- Depository — A third-party site where an investor’s physical gold assets are securely held for privacy, safety, and legal adherence.
This support network is instrumental when adding money to a gold IRA, as each role helps investors avoid IRS violations. The government doesn’t permit investors to personally handle precious metals intended for an IRA — either to store them at home or to move them into a self-directed IRA.
How to Fund a Gold IRA
A gold IRA can be funded in several ways, each of which comes with unique advantages, circumstances, and considerations. Understanding the differences will help you choose the method that best fits your retirement goals.
Funding Method #1 — Rollover
A gold IRA rollover occurs when retirement funds originating in an employer-sponsored retirement plan are moved into a self-directed IRA suitable for physical precious metals. Since the majority of US retirement savings is accumulated in workplace retirement accounts, rollovers are often the most common method of initially funding a gold IRA.
Generally, investors can complete a gold IRA rollover from the following types of employer-sponsored plans:
- 401(k)
- 401(a)
- 403(b)
- 457(b)
- Federal Thrift Savings Plan (TSP)
- Profit-Sharing Plans
- Money Purchase Pension Plans
- Defined Benefit
Eligibility can vary case-by-case, depending on an employer’s specific rules and an investor’s employment status.
Direct vs. Indirect Rollovers
The IRS differentiates between two types of gold IRA rollovers: direct and indirect. These terms refer to how funds are moved from an employer-sponsored retirement plan to a self-directed IRA.
Here’s how they break down:
Direct: During a direct rollover, investors never touch their funds. Instead, the money is sent directly to your chosen gold IRA custodian, who moves the funds into a self-directed IRA and records the transition appropriately. This is the advisable funding method as it significantly reduces your tax liability.
Indirect: When an investor takes temporary ownership of the funds, it’s known as an indirect rollover. Funds from an employer-sponsored retirement account are issued to the account owner via check, and the investor is responsible for depositing those funds in their gold IRA within strict time and procedural restrictions.
When a Rollover Makes Sense
A rollover is generally the most suitable method of funding a gold IRA when the bulk of your retirement savings is held inside a workplace retirement plan and you’re looking to diversify into physical precious metals. This applies whether you’re approaching retirement, changing jobs, or simply have an old 401(k) or similar account sitting untouched.
Some employer plans even allow in-service rollovers — meaning you can transfer a portion of your balance while still employed — though this depends on the plan’s rules and is less common.
Key Things to Consider About a Rollover
- You have 60 days to move funds into a gold IRA when issued through an indirect rollover. Failing to complete this transition in the allotted time can result in taxes on the lump sum.
- The IRS automatically withholds 20% of an indirect rollover amount, and investors are responsible for replacing that figure out of pocket so the full amount is redeposited.
Funding Method #2 — Transfer
If you’re moving retirement funds from an existing IRA instead of a workplace plan, the process is called a gold IRA transfer. This method is generally more straightforward because the funds are moving between accounts that share the same IRS legal framework, meaning the money stays within the IRA system rather than being removed and redeposited.
Funds can be transferred to a self-directed gold IRA from any of the following existing IRA account types:
- Traditional IRA
- Roth IRA
- SEP IRA
- SIMPLE IRA
- Inherited IRA
When a Transfer Makes Sense
A gold IRA transfer is the advisable option for putting money in a gold IRA when your retirement savings are held within any IRA and you want to expose those funds to physical metals — a critical difference between traditional and gold IRAs.
While rollovers come with reporting requirements and a tight deadline, in the case of indirect rollovers, IRA transfers are pretty straightforward. There are no tax reports involved, and you don’t even have the choice of handling the funds, eliminating the possibility of tax penalties.
Funding Method #3 — Annual IRA Contributions
The final way to add funds to a gold IRA is through standard annual IRA contributions. Every year, investors are allowed to transfer a federally regulated and tax-advantaged amount to these retirement plans. For 2025, gold IRA contributions are capped at $7,000 for those younger than 50 and $8,000 for those 50 and older.
When Annual Contributions Make Sense
Annual contributions are the smallest-scale way to fund a gold IRA because the IRS limits how much you can contribute each year. While rollovers and transfers can move larger balances at once, contributions allow you to gradually build your position over time.
This steady approach works well for dollar-cost averaging, helping smooth out price swings and maintain discipline. It’s especially useful if you’re just getting started, didn’t have an old retirement account to roll over, or simply want to continue growing your gold IRA balance year.
Key Things to Consider About Annual Contributions
- The IRS sets IRA contribution limits annually, which apply to all IRAs. These caps tend to rise over time to reflect the rising cost of living.
- Investors can be penalized for overshooting these contribution limits, resulting in tax liability.
What You Should Avoid When Gold IRA Investing
Gold IRA investing is as much about understanding what’s not allowed as it is about knowing the available funding methods. Rollovers, transfers, and annual contributions are the only IRS-approved ways to add money to a Gold IRA—no exceptions.
Because self-directed IRAs involve physical precious metals, the IRS enforces strict rules that govern which types of gold are permitted, how and when funds can move, and where and how metals must be stored. To remain compliant and avoid unexpected taxes or penalties, it’s important to be aware of the practices that are not allowed.
- Taking personal possession of IRA-owned metals at any point.
- Storing metals at home, in a safe, or in a safe deposit box.
- Purchasing metals personally and then trying to move them into the IRA.
- Using IRA metals as collateral or security for loans.
- Buying or selling metals to yourself or close relatives.
- Withdrawing metals without reporting the distribution, unless eligible.
- Exceeding annual contribution limits when adding new funds.
- Ignoring or falling short of RMDs for Traditional Gold IRAs.
Start Funding Your Gold IRA – We’re Here to Help
With three IRS-approved ways to start a Gold IRA: rollovers, transfers, and annual contributions. The right method depends on where your retirement savings are currently held and how quickly you want to build your allocation. Once your account is funded, your custodian can purchase IRS-approved bullion and arrange for secure, insured storage at an approved depository.
At Scottsdale Bullion & Coin, we’ve guided thousands of investors through the Gold IRA funding process with clarity and confidence. Whether you’re rolling over an old 401(k), transferring an existing IRA, or beginning with annual contributions, we’ll walk you through each step from start to finish.
Call us at 1-888-812-9892 or use our live chat function to speak with a precious metals advisor and begin your gold IRA strategy today.