Rolling Over 401k's to Gold

With the many uprising prophecies that the US economy is going to collapse,paper based assets like ETF's and Bonds have become a risky way to hedge for a safe future,many hard working people are now turning to gold to safeguard their hard earned wealth against inflation,and they are doins so by rolling over their 401k's and other IRA accounts into gold and precious metals.

 

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Where is the "0%" option?

For a 401(k), targeted at retirement, I'm still quite partial to investments that grow rather than shrink.

I haven't yet found a way to invest profitably in prophecies of collapse. Then again, the prophets of doom have been at it for a very long time, so perhaps they aren't growing enough to be profitable, either.

 

OP just joined CT today. Looks like a phishing expedition to me.

 

Forget the prophecies. Look at what's taking place, then act.

 

Putting precious metal in any sort of a "paper held in lieu" is extremely dangerous and in my mind a bad investment.

There have been numerous stories around companies selling it "on paper" and never backing it with the metal to carry the investment. There was another story recently where people lost everything because a company went bankrupt by selling IRA metals and not backing the paper. It was just discussed in the bullion forum I believe.

And in the best case where you find a good company, they will charge you buy, sell and management fees all throughout the investment. This erodes the entire purpose of the precious metal - to hedge against inflation and protect your wealth.

The only way I've ever bought "on paper" was by buying the mining stocks with the understanding of the risk.

Other than that - I hold physical metal in a safe deposit box. The fees I pay are to the bank, they're fixed, and I don't have people promising me a tax dodge or false stories of holding it in their safe deposit box. If I want to make sure it's there, I simply go visit it and look at it.

As far as the statement of "many are turning to..." well I wonder how many. It certainly isn't the majority. Sounds like another dupe.

 

Professor Marvel

Available for prophecies and advice.

 

people dont think about physical storage.. aq major issue with bullion

 

Gold and Silver as investment opportunities are really bad.

Besides, if the US Economy collapses, the World Economy would collapse as well.

Talk to the folks that rolled their 401K's into Silver when it was at $45 an ounce.......

 

It may go lower but it will go higher. Check your history. We have no inflation at the current time. Precious metals go up when inflation rises. With the National Debt as high as it is, inflation is coming and with that, the metals will go higher. We are at or near the end of a 3 year low for the metals. Can it still go down? Of course it can but it can't go down as far as it was when it was $48.00 an ounce.

In every market, prices go up and prices drop. You will have winners and losers. The stock market reported sometime ago, that 85% of the investors loose money and 15% are winners. Paper money is worthless in the end. In the early 1960's $1.00 bought a dollars worth of goods. It does not do that today.

Silver was around $3.85 before it went up to it's high of around $48.00. It didn't go straight up. It went up, fell back, went up, fell back until it reached it's high. Then it started back down. It went down, then up, then down more, then up and now it's in the $15.00 range. It changes every day. It changes throughout the day.

One must also diversity. In the metals, you can still diversity. Buy some on paper, buy stock in mining companies which are really beaten down, buy into metal funds which diversity for you. Buy and take physical possession of it, store some in a Metals IRA. Buy and stack silver ounces. Buy high grade coins, buy junk silver coins, just buy and hold. It will go up because the dollar has been over extended.

 

This is a fallacy, I think.

Of course it can't drop as far in dollars per ounce as it has already -- that's trivially true of any investment that's lost 50% or more of its value. That's not important, though.

What's important is percentages. Silver has already lost more than 67% of the value it held at its high point. Does that mean it can't lose 67% again? Of course not.

If I bought $1000 worth of silver near its high -- no, let's be honest: because I bought $1000 worth of silver near its high -- that silver is now worth closer to $350. (I got a little bit of a break when I bought it.)

If I bought $1000 worth of silver today, is there any guarantee that I wouldn't find it worth $350 three or four years from now? Nope. I think it's unlikely that it would drop that far from its current level, but it's absolutely a possibility.

As for the statistic about 85% of stock investors losing and only 15% winning, I have to say that I find that hard to believe. It's certainly not hard to lose money on stocks, but if you buy conservatively and sensibly, you get returns from companies' profits and growth. That's something you don't get from a simple interest-bearing account or commodity "investment" (speculation), and that's why in general stock returns over time outpace those other vehicles. Can you provide some more detail about who was saying this, and exactly what they said?

 

Using silver as a hedge against inflation is a poor man's dream which can quickly turn into a nightmare since "silver", is nothing more than a commodity anymore.

Back in 1964 when the US Government and the rest of the world for that matter, came of silver as the standard for money, it was because silver was becoming more valuable in the market place for things such as integrated circuits and photographic film. BOTH of those industries were gobbling up silver faster than it could be produced and the net result was a rise in silver prices.

Today, silver is rarely used for integrated circuits and the film industry is all but dead thanks to digital photography. Pretty much the ONLY industry which uses silver in large quantities anymore are governmental agencies which produce coins and the many bullion dealerships which sell those coins and produce their own collectible bars and rounds.

MILLIONS of ounces are pulled from the earth on an annual basis and a glut is totally possible. If a glut does occur, the price of silver will simply plummet.
It does not take a rocket scientist to see that the US Mint sells more than 40,000,000 ounces of silver a year and they've been doing this since 2009. That's a quarter of a billion ounces all pulled just from US Soil. It does not address the millions of ounces produced by the other industrialized nations in the world.

My bet, is that silver will continue to drop with little teasing up-spikes to keep the investor interest up but all in all, silver is going to go down fairly far before it ever see's a serious upswing in value. There is just too much of and not enough actual "need" for it.

As for gold, similar but not quite as high a production value. Gold plated jewelry will always have a niche market but the vast amount of gold today is relegated solely to collectible bullion pieces and ingots. It has lost its capability for use as money or an investment tool. After all, you can only do up 1, down 2, for so long before something becomes worthless and the big money investors will be long gone by then.

 

Dear friend
I want you to back your idea with facts and not what many people say,I know many companies who provide physical precious metals at secured storage facilities like the Brinks,and investors can track their metals

Dear friend
I want you to back your idea with facts and not what many people say,I know many companies who provide physical precious metals at secured storage facilities like the Brinks,and investors can track their metals 24h/a day.
Concerning the "many are turning to..."
If you do a quick search at google keyword tool ,you will see that about 1000 Americans search the term gold ira rollover every month
260 search the term 401k to gold ira rollover every month and about 70 search 401k to gold eachmonth,isn't that enough to say many?

 

http://d3au2jhdi7kksl.cloudfront.net/Bankruptcy-Case-Filing-7-20-2015.pdf

I suppose this pdf of Bullion Direct filing for bankruptcy would stand as facts for what the other poster had to say. If someone wants to invest in a PM IRA fine but better find a reliable company and because the rules are so strict regarding PM IRA's. The 'custodian' of the account is the one who takes your money and then buys/stores your bullion until you liquidate or reach retirement age and can then finally take physical possession.

This essentially means that you never get to see your physical metal and makes PM IRA's ripe for fraud ala this Bullion Direct thing. Anyone can take the money and send an account statement saying you have x,y,z in precious metals in your account. But with no way to actually view your PM and if you want it for a PM IRA you can't just buy it yourself and then place it in storage due to the PM IRA rules a 'custodian' has to do this for you. Not sure how the great minds of government who approved these types of IRA's didn't foresee how they would make an almost perfect ponzi scheme situation.

If someone wants to invest in PM fine but might as well buy the physical metal yourself and avoid a PM IRA. Your poll should have had more choices for a percentage as 15% and 90% seems way too high. I myself technically I guess hold a good chunk of value in PM but I buy them because I like the coins not because I think they will make me rich someday.

Also I know that PM hawkers usually push currency collapse as one reason to hold PM and for instance if that did occur (which I'm not in the camp thinking it could or will unless the whole world went to shhh) does anyone believe that you'd be able to get your PM from the custodian? Or how about PM's having any value at all in a disaster scenario? Nope, food, water, lead would be valuable commodities not hunks of metal you can't really do anything with. Most examples of places where drastic economic collapse happened and PM's had any value when used as examples also leave out that it was because only localized currencies went south that PM still had any value. The value was when compared to another non faltered currency which could be used to buy x,y,z. If the U.S. dollar ever did collapse I don't think PM's would valuable as some hawkers try to pretend they would be. People wouldn't be trading a loaf of bread for a mercury dime or a cow for a gold eagle, that's simply a fictional estimation of what reality would be like. It would probably be a nightmare that I nor anyone else would ever want to experience.

 

If I were to invest money in precious metals, I don't think I'd want to be putting a whole lot of money into it. If it were me I'd just throw some money (not enough money that if silver goes to $5 an ounce I won't be able to retire until I'm 130) at some gold or silver and see how it plays out.

In short, I'd use PMs as an aside to regular investing.

But do take this with a grain of salt because I'm only 19 and I wouldn't advise taking financial advice from a teenager.

 

Your advice is good despite your youth...

 

Boy - look how many people like the 0 percent option. I think that is the answer. You ask and have an answer. PS - I don't think it matters how many search gold to 401 or 401 to gold. So I don't think I would base a decision off of how much searching is done or even factor it into a decision.

 

When sellers of bullion start saying they won't sell for Paper cash, clad coins, or credit cards, only for real estate, solar panels, drugs, guns, ammo, bottled water, or MREs, and you have to exchange it at their compound, I might feel a little shaky with fiat. Until then, its spooky advertising for the bullionsheep.

 

At your age, now is a good time to be looking at retirement. If you can put just a bit away, you have a long time to compound interest and value appreciation.

You also have a lot of time to recover if you make mistakes - and if you make them small, you'll do well.

Having a bit of precious metal in your portfolio would give you a horizon of about 60 years before you really hit the point of needing to sell.

You are also smart enough to know that you do have a retirement age and you should be able to reach it with your investments. Maybe you start by buying an ounce of silver a month and putting the same into an IRA in a target fund - or even better - an active fund and start to study the "target date" funds moves.

Good luck to you either way, good to see some in your generation has an eye on more than Justin Bieber.

I turn 45 this year. If I had done the "ounce a month," from age 20 to 35 I'd have been able to leverage silver's last run to $40. I would have bought roughly 180 ounces at ~$8 an ounce average up until 2005. That $1440 investment would have turned into $7200.

Back on the original subject, there have been several "bullion storage" companies that have gone out of business and left the investor hanging. I'll store my own metal - and to heck with the government tax dodge. They weren't there to help these people protect theirs.

Add on top of this the "fees" to manage something like this and it just seems like a bad idea for most. But it is another investment tool that people are selling. To each their own.

 

"Dear Friend" is what politicians say before explaining how they have your best intentions at heart as they fleece you of your wealth.

Caveat Emptor