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Diversifying Your IRA or 401K Investments

Have you looked at your IRA or 401k investments to make sure you are diversified in your investments?

It is important to protect your retirement funds, because you want to gradually build the worth of your portfolio to make sure you have enough money in retirement. This means you don’t want to put all your money in only one or two investments. Diversifying gives you gradual grow of your portfolio worth and helps to avoid a devastating loss in one type of investment.  All investments have peaks and valleys and a successful way to make money is to follow the advice of one of the best investors of all times, Warren Buffet.  Mr. Buffet’s philosophy is to “Be fearful when others are greedy and greedy when others are fearful.” This basic philosophy will prompt you to buy in the valleys and sell at or close to the peaks. Another way to express this is to “buy low, sell high”, which is a simple strategy but not easy.

The recent pullback in gold presents a buying opportunity. The basic reasons for buying gold have not changed. The U.S. economy has displayed signs of slow growth but is still struggling. Europe and the PIGS (Portugal, Italy, Greece and Spain) are still deeply in debt. The high riding BRICs (Brazil, Russia, India and China) economies have cooled. All of these indicators explain the pullback in gold but have not changed the reasons for gold as a solid long term investment.

You can diversify your IRA and/or 401K portfolio by putting a percentage of your investments in gold. You cannot personally hold gold when you buy gold in your 401K or IRA, you will need to have it held by a custodian. You can get information on custodians that perform this type of function with a reputable gold dealer. Each custodian offers different services so you can choose one that is right for you.

Once you select a custodian, contact the custodian to get the forms you need, fill out the forms and get them to your chosen custodian.  Once your custodian gets the completed forms and the money is transferred, you can purchase your gold. You can also get guidance from a reputable gold dealer to help you with the entire process.

If you decide at a future time to take personal possession of your gold, you will need to take a distribution. Or you can sell your gold in your IRA or 401K and take your distribution in cash.

What Gold Can You Buy in Your IRA or 401K?

If you are a U.S. Citizen the U.S. Government allows certain bullion and proof coins to be purchased in your IRA or 401K. These would be bullion and proof coins like the American Eagles or Buffalo, in either silver or gold. If you are not familiar with proof coins, they are specially minted uncirculated coins that look like the circulated coins but have a finer minting process that creates a sharper image and mirror backgrounds. Proof coins are also inspected and when they pass inspection each coin is placed in a protective case to protect the superior minting.

Proof coins are restricted in the number of coins minted for each production year.  If you are not an experienced coin collector, look for popular proof coins because demand will increase your profit potential. Expect to pay more for proof coins than you would for circulated coins to cover the cost of the special minting and account for their numismatic value.

Start today, on the road to diversifying your 401K or IRA portfolio. Contact a reputable gold dealer, select a custodian for your gold, get the forms filled out and get them to your custodian so you can take advantage of this gold buying opportunity.

 

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