Red Oak Capital was founded on the belief that everyone should have the opportunity to afford and benefit from owning precious metals. As such, we create investment strategies tailored towards each investor based on their specific desired asset protection outcomes.
Having an IRA (individual retirement account) is a smart way to secure your future, but for those of us who aren’t financially savvy, the process can seem a little daunting. Whereas typical IRAs focus on stocks and paper assets, a silver IRA deals with precious metals.
Owning precious metals is one of the safest and most trustworthy ways of lowering your investment portfolio risks. Owning silver would mean you are taking part in one of the oldest mass-produced forms of coinage. In addition to being a collectible, silver serves many industrial purposes. This is why, throughout history, precious metals such as gold and silver have remained relatively constant, even during times of great stock market fluctuation.
Whether you are saving for retirement or have always been renting and are ready to make the transition into homeownership, the reasons are endless as to why you would benefit from owning silver and making it part of your investment portfolio. Let’s learn how to invest in a silver IRA!
The demand for precious metals such as silver is only continuing to rise. Our country uses silver for industry, banks, financial institutions, and governments. With the evolution of technology, silver will be needed more and more as the demand for new technology increases. The problem is that the demand for silver is high and the supply is beginning to decrease. Given the global economic uncertainty we all currently face, funding for the mining of silver has been on the decline.
No one wants their investments to be displayed for all to see. Privacy is an important aspect of an IRA account and when purchasing a silver IRA, your purchases are delivered directly to your home. This means that your financial decisions are your own, free from any third-party influence.
In the past, investors have seen a great return on silver IRAs. This is because silver is a limited resource, and this gives it the potential to grow in value over time. With the price of precious metals being at lower levels today, and in combination with the increasing demand for silver, the potential for future growth is high.
Not all investments perform well; this is one of the risks of investing. The upside is that others have the potential to exceed expectations. This is why having a diverse investment portfolio is so important. Populating your investment portfolio with a variety of bonds, precious metals, stocks, and cash will give you more flexibility in being able to compensate when one aspect of your portfolio takes a hit. Owning a silver IRA is one way to play it safe and smart, because precious metals have been shown to exhibit better performance rates than all other investment categories.
Silver is one of the most revered assets worldwide due to its ubiquity and versatility. Silver IRAs are one of the most liquid assets you can own because of silver’s flexibility when it comes to trading.
As our world becomes more efficient with growing technology, the use of paper money has greatly decreased and will continue to decrease over time. The value of silver will always be potent. Silver’s value will continue to increase in a time when paper money loses its status as a primary form of currency. Owning a silver IRA will be a powerful tool for protecting your portfolio from inflation over the years.
Silver IRAs don’t discriminate when it comes to who can open an account. If you have employment or are self-employed, you can open a silver IRA account today.
Rollover is a common way to fund a silver IRA. With the rollover program, any amount of funds that are in another IRA account, assuming they are moveable or part of an employer retirement plan, can be withdrawn and used to fund your silver IRA within 60 days of withdrawal. There are no charges or penalties involved in this transaction. This is the most common way to fund your silver IRA account when you have an employer-sponsored retirement plan such as a 401(k). A good rule of thumb is that this method can only be used one time per year and one time per account.
With direct transfer funding, the original account holder is the source to request that the funds be sent directly from the current IRA trustee to the brand-new IRA account. The original account holder watches as their funds are moved from one company to another without needing to put in any elbow grease. It is a simple and smooth process that requires minimal effort from the original account holder.
This type of transfer and funding is appreciated because it is completely tax- and penalty-free. In addition, unlike the rollover funding option, it has no restrictions on how many times you can transfer funds.
An easy and hassle-free aspect of owning a silver IRA is the fact that money can be withdrawn from your silver IRA at your convenience. An important thing to keep in mind is that if a withdrawal is requested before you have turned 59.5 years of age, then a federal penalty of 10% does apply to your withdrawal sum.
Indirect rollovers are tax- and penalty-free, but it is important to keep in mind that indirect rollovers must be completed within 60 days.
A 401(k) is the most common IRA used for contribution to a retirement plan and a great account option for anyone looking to set up a silver IRA account. Such accounts are employer-sponsored and will always be provided by a for-profit company. One aspect that makes the 401(k) such an attractive option is the fact that they can be rolled over. This also makes them a safe bet for those who may feel daunted by the alternatives. The rollover requirements stipulate that you must be 59.5 years of age or older, or no longer working for the employer in question.
Non-profit companies are the only types of companies that offer a 403(b) retirement IRA plan. This is a good silver IRA retirement plan option because it is employer-sponsored. As in the case of a 401(k), you must be 59.5 years of age or older, or longer working for your employer, in order to qualify for rollover benefits.
A 457(b) silver IRA retirement plan is a tax-exempt government-deferred compensation plan. This option is only available to individuals who are employees of park board, township, city, county, water district, or similar government-affiliated organizations. The unique aspect of this plan is that it allows those registered for it to make pre-tax salary deferrals. When it comes to withdrawing your funds, this plan has no age restrictions. Thus, there are no penalties for withdrawing your money before the age of 59.5.
A traditional IRA is the most widely known form of a silver IRA retirement plan, or any retirement plan for that matter. This type of silver IRA allows you to invest in pre-tax income that can grow with no capital gains, meaning that no dividend income is taxed. The contribution limit is between $5,500 and $6,500, and the amount you can invest is dependent on tax-filing status, income, and multiple other factors that are taken into account.
Although the traditional silver IRA retirement plan offers great flexibility in terms of when you can withdraw your funds, just keep in mind that the rollover stipulations require you to be 59.5 years of age or older to withdraw your funds, or a federal penalty will apply. Contributions are tax-deductible and taxed upon withdrawal of the funds.
A Roth IRA is another widely known form of a silver IRA retirement plan. This type of silver IRA retirement plan allows you to contribute your post-tax income toward investments that grow on a tax-deferred basis. The contribution limit is between $5,500 and $6,500, and the amount you can invest, as in the case of a traditional IRA, is dependent on tax-filing status, income, etc.
You can also withdraw your funds with no penalty, so long as you are 59.5 years of age or older and your Roth IRA is at least five years old. Failure to meet these requirements will result in a federal penalty for every withdrawal. Contributions are not tax-deductible and are not taxed upon withdrawal of funds.
The Savings Incentive Match Plan for Employees, or SIMPLE IRA plan, is best suited for small employers and is a great silver IRA retirement plan option for those who meet its requirements.
What sets this plan apart from other silver IRA retirement plans is that it is a viable option for self-employed individuals. Those who work for themselves as sole proprietors, or who work only for small operations (including startups), may not be aware that an IRA option is available to them. It is important to note that the SIMPLE IRA account needs to have been established for two years for it to be able to be moved to a traditional silver IRA account.
SEP stands for “simplified employee pension.” This is another solid silver IRA retirement plan option for employers or self-employed individuals who are looking to set up a retirement plan.
Requirements for setting up this plan state that you need to be the owner of the business, the president or CEO, or self-employed. SEP IRAs can be rolled over into a traditional IRA or a new SEP IRA account. You are allowed to contribute up to 25% of your income—up to $55,000 per year—into your SEP IRA account, making it an exciting option for a wide variety of individuals. Contributions are tax-deductible.
TSP, or “thrift savings plan,” is best suited to federal government employees. The TSP silver IRA retirement plans offer two tax- and penalty-free options for transferring money between retirement accounts. One of them is the 60-day rollover option, while the other is the trustee-to-trustee direct transfer option.
When applying to rollover your funds, you must have been separated your service from the federal government, or be 59.5 years of age or older to withdraw your funds. Otherwise, you will incur a federal penalty.
TSA stands for “tax-sheltered annuity” and names yet another viable silver IRA option for any employee wanting to make contributions to their retirement plan from their income. It is found in many 403(b) plans.
With the TSA silver IRA retirement plan, contributions are taken from employee income and are not taxed until the employee withdrawals them from the plan.