A silver IRA is a specialized individual retirement account that makes it possible to invest tax-deferred dollars into physical silver assets. Contrary to conventional retirement plans which are restricted to stocks, bonds, mutual funds, and ETFs, this type of self-directed IRA opens investors to a range of tangible assets, including real estate, art, and physical precious metals like silver bullion, bars, and coins.
A silver IRA marries the tax perks of a conventional retirement account with the inflation-hedge properties of physical precious metals. Despite its clear advantages and perfect legitimacy, this flexible retirement plan flies under the radar for most investors. Understanding how a silver IRA works along with its investment benefits can help investors build a more resilient, diversified, and higher-yield nest egg.
How to Set Up a Silver IRA
Establishing a silver IRA is a quick and straightforward process. In most cases, it only takes a few weeks. The setup can be broken down into three phases:
1. Opening a Self-Directed IRA
The initial step is creating a self-directed IRA which permits the investment of tangible silver assets with tax-advantaged dollars. You’ll need to fill out some documents and submit them to the IRS for the account to be approved.
2. Funding the IRA
Once your silver IRA is established, it’s time to fund it. You can move money into the account by making IRA contributions or through a transfer or rollover from a current retirement plan. 401(k)s, 403(b)s, 547 accounts, Thrift Savings Plans, and traditional and Roth IRAs are eligible for transfer and rollovers.
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3. Buying Silver Assets
The final step is furnishing your silver IRA with physical assets. The IRS has strict regulations on the types of silver assets permitted which is why investors are advised to work with knowledgeable precious metals advisors. These experts can help you determine the optimum silver assets based on your specific investment goals while adhering to IRS laws.
Benefits of Investing in a Silver IRA
There are several reasons why people invest in a precious metals IRA.
Tax Benefits
A silver IRA drastically reduces your tax burden by allowing you to put tax-deferred dollars toward physical silver. When purchasing silver assets outside of this retirement plan, your wealth is hit by income tax and capital gains. This plan is the only place you’ll find the tax benefits of a conventional retirement account with the allowance of physical assets.
Real Diversification
Precious metals such as silver and gold are the hallmarks of a well-diversified portfolio. No matter how many different stocks, bonds, ETFs, or mutual funds you hold, your nest egg will still be exposed to the inherent weakness of the market. On the flip side, tangible silver assets have a proven track record of preserving their value through periods of economic downturn.
Portfolio Protection
Physical silver is heralded for its ability to hedge against inflation. While paper assets are susceptible to the whims of market volatility, physical silver boasts inherent value due to its widespread use, high demand, and relative scarcity. A silver IRA acts as a buffer between your nest egg and the threat of economic pressures.
Asset Control
Standard retirement plans aren’t just confining in terms of eligible investments. These accounts also restrict the amount of control you have over your wealth. Paper assets are only represented by paper or digital receipts. With physical silver products, you have literal ownership and control of your investments.
Growth Potential
When compared to the performance of the greenback, the value of silver has been shown to yield higher returns over time. During the past 10 years, the US dollar has lost 2.65% of its value each year on average. In contrast, silver has the potential to grow your nest egg, especially when held long-term. This growth potential is compounded by the tax perks of a silver IRA.
What is IRA-approved silver?
IRA-approved silver refers to physical silver assets that meet IRS requirements for inclusion in a silver IRA. As mentioned before, the government places rather strict limits on what kinds of precious metals investors can hold in these self-directed IRAs. Eligible precious metals are determined by:
- Asset Type – Only silver bullion bars, coins, and proof coins are allowed.
- Purity – A silver product has to contain at least 99.9% silver.
- Weight – Silver coins must be 1/10, 1/4, 1/2, or 1 oz; silver bars are only allowed up to 1,000 oz.
Your Silver IRA – Getting Started is Easy
Eager to unlock the tax advantages and wealth protection of a silver IRA? You need to set up an account, fund it, and purchase eligible bullion products. Adhering to legal requirements and selecting the right assets are crucial for getting the most out of your silver IRA. At Scottsdale Bullion & Coin, we have over a decade of experience helping customers establish legal, secure, and optimized silver IRA accounts. Our dedicated precious metals advisors can help you too! Contact us by calling toll-free at 1-888-812-9892 or using our live chat function to get started.