Turning IRA into Gold IRA

[Printo]

Hey there guys. I was wondering what everyone's thoughts were on the subject matter. Recently, I've been thinking of turning my IRA into a Gold IRA. I hear rumblings of gold prices sky-rocketing in the future again. Of course, inflation is running rampant though we havent been hit by this upcoming wave just yet. I am 23 years old and was wondering what was everyones opinion about taking my current Roth IRA and turning it into a Gold IRA.

Would you guys do it? Why/why not? Have you guys done it? What are the pros & cons of doing so?

 

[Dforkus]

I wouldn't put it all there, I try to stay going over in 40% in any single asset class let alone one element of one asset class. Asset class being loosely defined as real estate, equities, commodities(gold, silver, oil, etc.), debt(bonds, CDs, Money Markets, Saving accounts, etc..). I suppose you could put currencies as an asset class too, but I stay far away from any direct interaction with FOREX..

Whatever you do end up putting in there I would dollar cost average..

Why, because the realization that you don't know the future, and neither do the people that say they do, is valuable knowledge indeed..

 

[Jordan]

Going to a gold only IRA at 23 is pure stupidity.

Knowing that gold only changes in price at the same rate of inflation or deflation, what do you have to gain? Nothing.

Gold protects your wealth, it doesn't grow it. Unless you plan on saving a hell of a percentage of your paycheck, a gold IRA will likely leave you eating ramen noodles when you reach retirement age.

 

[tmosley]

Going to a gold only IRA at 23 is pure stupidity.

Knowing that gold only changes in price at the same rate of inflation or deflation, what do you have to gain? Nothing.

Gold protects your wealth, it doesn't grow it. Unless you plan on saving a hell of a percentage of your paycheck, a gold IRA will likely leave you eating ramen noodles when you reach retirement age.

It's value also changes with changing populations, and it will change greatly once it is in demand on a worldwide scale as money again.

Basically, it's a play limited downside and nearly unlimited upside, with the added benefit of being the ultimate protection from a currency crisis.

 

[intelliot]

I don't understand Jordan's opinion at all. The numbers on your cash will not change in a time of inflation (which we'll be in soon), but they will be worth less. Putting your money into gold, therefore, will make you end up with more money than if you had left it in cash. And if you invest in the stock market, with all its volatility, you have a good chance of losing some of your principal and ending up even worse off.

Printo, we're both in similar situations. Keep me updated on what you decide.

 

[devil21]

If you don't hold it, you don't own it.

 

[Jordan]

I don't understand Jordan's opinion at all. The numbers on your cash will not change in a time of inflation (which we'll be in soon), but they will be worth less. Putting your money into gold, therefore, will make you end up with more money than if you had left it in cash. And if you invest in the stock market, with all its volatility, you have a good chance of losing some of your principal and ending up even worse off.

Printo, we're both in similar situations. Keep me updated on what you decide.

Hmm...

If we have inflation of 5%, gold goes up 5% while your spending power goes down 5%. Agree? In which case you've only protected your wealth, you did not at all grow it.

You have just as much of a chance in losing money in the stock market as you do in the commodities market.

I dare you to take a look at the gross expansion of the money supply from 1987-2000 and the change in the price of stocks, and the change in the price of metals. Money supply increase nearly 10 times over, stocks went up 1000% while gold dropped from $500 to $300. Care to tell me why that happened?

 

[Bradley in DC]

You may want to look at David Tice's Prudent Bear funds.

Also, I started a thread on Austrians for investors here:
http://www.ronpaulforums.com/showthread.php?p=2324816

 

[Arklatex]

Buy gold equities inside a Roth IRA - look at the index GDX.

 

[Printo]

With the trend of government spending and the expansion of the supply of money, I find it hard to believe that the price of gold will drop. I only see it rising. I believe would make a safer investment than playing the stock market. Saving money is just plain dumb because inflation outpaces the rate of return on savings (plus we are taxed on savings & capital gains).

I dont see how gold would be a terrible investment at this point in the game. Imagine if you were to invest when gold was capped at $35/oz. Now its floating around $950-1000/oz.

I just do not see money supply shrinking and/or demand for gold falling.

 

[Jordan]

With the trend of government spending and the expansion of the supply of money, I find it hard to believe that the price of gold will drop. I only see it rising. I believe would make a safer investment than playing the stock market. Saving money is just plain dumb because inflation outpaces the rate of return on savings (plus we are taxed on savings & capital gains).

I dont see how gold would be a terrible investment at this point in the game. Imagine if you were to invest when gold was capped at $35/oz. Now its floating around $950-1000/oz.

I just do not see money supply shrinking and/or demand for gold falling.

You do realize that gold, in the world of investments, is just saving? Gold only produces a return equal to inflation, you never grow your wealth, you just protect it.

But look, I'm not going to try to talk you out of something. Go 100% gold, maybe you'll be happy with the returns, maybe you wont. All I am saying is that at 23 years old, it makes no sense to embrace absolute safety.