Gold for Retirement Plans:

Gold and Retirement Plans

The basic format of any retirement plan assumes that you are deferring assets until you reach retirement age. Most plans rely on third party to administer the investors money. Among these are IRAs, 401 Ks, Roth IRAs and other popular retirement plans.

Gold Bullion is a great investment for 3rd Party Plans as long as someone else holds the assets. In other words, you won't take actual possession of your gold until you retire or another event takes place to allow you access to your gold without penalties. Some banks will act as a third party custodian for a fee. Remember, if you want to invest in gold, you better make sure your 3rd Party is someone that you can trust.

For those of you that are nervous about someone else having possession of your gold, there are other retirement vehicles available. These are called self-directed plans that allow you to hold onto your gold bullion directly. The two I like the best for gold are the SIMPLE IRA and the self-directed IRA.

You will need to talk to your tax professional about setting up a self-directed plan for gold. The rules are simple. You buy the gold. You hold the gold. You sell the gold. All transactions are reported as funding transactions whereby you avoid disclosing the asset; but you report on the amount of money you invested in gold.

Self-Directed plans are designed primarily for the self-employed. So, if you have a business, this is your best option for investing in gold. If you don't have a business, start one! All you need is a source of legitimate revenue and an LLC or Corporation with you as the principal owner. With the LLC, you should act as the registered principal. With a corporation, you should own the majority of the stock and act as President.

Corporations and LLCs are legitimate third parties and are allowed to purchase gold and gold bullion to fund retirement vehicles. Even if you are the primary owner!

To be eligible, the investment must be 90% or greater in gold content. This means that most gold bullion coins, like the American gold Eagles, are ideal assets for these plans. The benefit of minted gold coins is that they are also technically currency, another permitted investment for retirement plans.

One of the fears of owning gold bullion is the fear of the government calling in all of the gold and replacing it with a paper currency. This has happened before in the United States under Franklin Delano Roosevelt. Roosevelt ordered all Americans to turn in their gold for dollars under his gold confiscation act. He also made it illegal for Americans to own gold.

While this is a very real possibility in the near future, there are technical loopholes that will allow you to avoid confiscation.

1. No government can confiscate the currency of any other government. The United States, for example, cannot demand that Canadian Currency be confiscated. Neither can Canada confiscate US currency.

2. Gold Bullion Coins minted by another country cannot be confiscated by the United States Government.

3. The gold Krugerrand, minted by South Africa fell into disfavor as a result of Apartheid. Prior to that, it was the investment of choice in America before the gold confiscation act was repealed.

4. The Gold Canadian Maples, which are 100% pure gold, came into favor after the Krugerrand. They are available in 1 ounce, ½ ounce, and ¼ ounce and 1/10th ounce. These gold coins are softer because they contain no hardening metals. Store them in hard plastic cases for the best possible protection from scratches and defacement.

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