Should my Self Directed IRA invest in gold?
For as long as there have been IRA accounts people have wondered if it is smart to own gold or other allowable precious metals in their IRA. Of course, the choice is an individual one. However, we can share our perspective on this timeless question.
Why no?
Rarely, will you hear gold referred to as an investment. Instead, you may hear gold referred to as a “store of wealth” or a “hedge against a decline in the dollar.” Why? As an investment, when compared to other opportunities, gold has turned out to be a weak performer. Gold will NOT pay your IRA:
- Rent, like so many Self Directed real estate investments.
- Interest like so many Self Directed investments.
- A dividend like so many Self Directed investments.
- Gold is one of the only investments you will always buy at retail and sell at wholesale. Hence, the minute you buy it, you automatically have an asset that is worthless.
This leaves the investor with only one way to make money; price action. Let’s look at the price action over the past 30 years:
| Year | Gold Prices |
| 1990-2003 | Mostly Flat |
| 2003-2012 | Steady increase |
| 2012-2013 | Choppy |
| 2014-2019 | Down |
| 2019-present | Steady increase |
If you bought gold in 2003 and sold in 2012, then bought again in 2019 and sold today congratulations, you are a genius! Other than that, almost any other asset class would have outperformed.
A positive
Gold shines in times of uncertainty and/or a weakening dollar. Typically, when the dollar grows weaker the price of gold goes up.
Buy gold or avoid it?
In conclusion, the answer can only be driven by your view of the world economy.
- Will the U.S. economy be stable and provide growth opportunities for a careful investor? In other words, will there be growth in the value of real property?
Or
- Is the dollar on a long downhill slide until it reaches a new and less valuable position in the world economy?
For information about the Self Directed IRA or Solo 401k, and how we can assist you, please call IRA Club at 312-795-0988. If you are interested in holding gold or other precious metals in your IRA, give us a call! We can share our experiences with various precious metal vendors.
Be advised that IRA Club does not evaluate, review, monitor, recommend, warrant, guarantee or otherwise endorse the legality, tax treatment, propriety, performance or reliability of any investment, service, statement, opinion or other representation provided with respect to the investment opportunities listed on its site or their sponsors or providers. IRA Club has no financial arrangement, partnership, joint venture, or other affiliation with the sponsors or providers of these investments. IRA Club shall not be liable for any misinformation, misrepresentation, negligence, act, omission, investment results, or any wrongdoing with respect to any of these investments or their sponsors or providers.
