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What Is A Gold IRA Rollover?

Updated: March 2, 2023
By: Jonathan Trout
Jonathan Trout
Content Manager
Jonathan is a former product and content manager for Retirement Living. His background spans sales/marketing, finance, and telecommunications. Jonathan’s expertise in consumer wellness and research-backed data stories helped educate seniors on financial planning, retirement, and community resources. Jonathan graduated from Oklahoma State University with a B.S. in Environmental Sociology.
Content Manager
Edited by: Jeff Smith
Jeff Smith
Sr. Content Manager
As Retirement Living’s senior content manager, Jeff oversees the product and publishing of all retirement, investing, and consumer wellness content on the site. His extensive expertise in brand messaging and creating data-driven stories helps position Retirement Living as a top authority for senior content and community resources.
Sr. Content Manager

Rolling over a 401(k) plan into a traditional or Roth IRA is pretty common. You’ll often do this when you transition to a new job and want to keep your retirement savings in one place. But you may also roll over funds if you want to capitalize on the many benefits of gold and hedge against inflation. To fund your investment in precious metals, you might consider rolling over some 401(k) funds to a gold IRA.

What is a Gold IRA?

Gold IRA self-directed individual retirement account that allows investors to hold hard, physical assets in their retirement portfolios. Traditional and Roth IRAs typically hold only cash, bonds, and stocks. The Taxpayer Relief Act of 1997 broadened the types of investments allowed in individual retirement accounts to include certain types of precious metals. These IRAs are called “self-directed” or “alternative-asset” IRAs. Not all precious metals are allowed. Usually, they are limited to gold, silver, platinum, and palladium. Tax laws also specify purity standards for each metal.

What is a Rollover?

If you have a retirement plan such as a 401(k) or 403(b) through your employer and leave to take another job, you can roll over the money in your current retirement accounts into another IRA.

IRA rollovers can occur under one of these conditions:

  • The sponsoring company substantially changes its retirement plan

  • The sponsoring company changes the custodian of its retirement plan

  • The employee terminates employment with the sponsoring company

  • Another IRA offers better investment opportunities than the one you have

How Are Rollovers Done?

Once you’ve opened your gold IRA, you can contact the company managing your 401(k) account to begin the rollover process. The IRS stipulates three ways to complete a rollover.

  • Direct Rollover: Ask your retirement plan administrator to issue a check directly to the retirement plan or IRA to which you wish your money rolled over. This method (instead of an indirect rollover) assures the IRS will not withhold any taxes.

  • Trustee-to-Trustee Rollover: If you are rolling over your IRA, the trustee of the IRA can facilitate the rollover to the trustee of the other IRA. There are no taxes withheld using this method.

  • 60-Day Rollover: A check can be issued directly to you for the amount of your rollover. No taxes will be withheld if you invest it in another IRA or retirement plan within 60 days.

Some investors choose to roll part of their retirement savings into a gold IRA rather than all their savings. In this case, a portion of the retirement savings will be subject to the special rules concerning a gold IRA rollover.

How Are Gold IRA Rollovers Different?

If you choose to roll a portion of your savings into a traditional or roth gold IRA, you must abide by more specific rules. First, decide how to invest in gold, such as physical gold, company stock, a mutual fund, or an exchange-traded fund. If you opt for physical gold, you must buy coins or bullion that meet the purity standards defined by the IRS. You must hold it with an IRS-approved custodian who follows the proper guidelines for storing your gold. Legally, you should not store your gold at home unless you want to risk penalties and added taxes.

Second, you’ll establish a self-directed IRA, which allows you to invest in a wider range of assets. Then, you need to choose a custodian to create and maintain your account. The custodian can be a bank, credit union, brokerage firm, or trust company. The custodian you choose must have the facilities to store the physical gold. If you’re unsure about where to start, read our guide on the best Gold IRA companies to help you get started in your decision-making process.

Finally, you’ll need to locate a broker to buy the physical gold. Your chosen custodian may have relationships with established brokers. Choosing a reputable broker who will buy IRS-approved gold is important.

When choosing a company to work with, look for these three things:

  • Qualifications: The broker should have all the appropriate licenses, bonds, and insurance to protect your investment.

  • Reputation: The broker should have an excellent reputation. Research customer reviews on several websites, including complaints filed with the Better Business Bureau.

  • Responsiveness: Inquire about the company processes and educational resources with a representative. The company should be responsive, knowledgeable, and patient.

After the company purchases the physical gold, it can fund the gold IRA and store your assets at a secure facility.

Bottom Line

Rolling over some of all of your investments into a Gold IRA is a popular option for people looking to avoid the uncertainty of the stock market. Before starting the process, make sure you research reputable companies that partner with vetted storage facilities and abide by all government regulations.